HJ 3306 A3 1911 j> 1 -t^ -o '^ cJ ? 5^ of o •» c/ v» :^ ^ d:: o> l-f J^ 1 -r mn w-'^C lie date 8how« when this volui To renew this book copy the call N - the librarian. HOME USE RULES. All Books subject to Recall. Books not in use for instruction or research are, returnable within 4 weeks. Volumes of periodi- cals and of pamphlets are held in the library as much as possible. For special purposes they are ffiven out for a limitedtime. Borrowers should not use their library privileges for the bene- fit of other persons.. Students must re- turn all books before leaving town. Officers should arrange for the return of books wanted during; their absence from town. Books heeded by more than one person are held on the reserve list. Books of special value and gift books, when the giver wishes it, are not allowed to circulate. Tl Readers are asked to report all cases of books marked or muti- lated. Do not deface books by marks and writing. ..5../3li-/i3.. 6561 pter 285, Laws oi Minnesota '■ 1911, Relating to == ASSESSMENT AND lAXAIION of Money and Credits gether with the Text of the Decision of the Supreme Court sustaining the constitutionality of the law, and denying the right to deduct debts from credits and LAW. Q subject to aws of 1911, ad assessing as listed on imo rate as le under tlie and is taxed ar, or thirty on. , eans money ion, whetlier lis or some BRIEF SYNOPSIS OF THE LAW 5 receivable, lotes, bonds, OT demands and credits ' notes and recorded in egistry tax nunicipality e fair cash rcentage of s. Winona jrthwestern ISSUED BY 2 Minnesota Tax Commission 1912 St. Paul, Minnesota ^ ake a veri- the listing ven though iroperty he ig out such s true the erson mak- H(7 l\zr\\°\^'\ SYNOPSIS OF THE LAW. Money and credits have always been subject to taxation in Minnesota. Chapter 285, Laws of 1911, simply changes the method of listing and assessing this class of property. Under the old law, such property was listed on the same blanks, and taxed at the samo rate as other classes of personal property, while under the new law it is listed on separate blanks, and is taxed at a flat rate of three mills on the dollar, or thirty cents on each hundred dollars of valuation. "Money," as defined in the law, means money owned by an individual, firm, or corporation, whether in hand or on deposit in a bank in this or some other state. "Credits," cover all book accounts, bills receivable, land contracts not recorded, promissory notes, bonds, rents, annuities, and all other claims or demands for money or other valuable thing. The law does not include the money and credits of incorporated banks in this state, or notes and bonds secured by real estate mortgages recorded in this state upon which the inortgage registry tax has been paid, or the bonds of any municipality issued since April 18, 1911. The assessment is to be made at the fair cash value of the property, and not at a percentage of such value. Debts cannot be deducted from credits. Winona Motor Co. vs. State of Minnesota, 134 Northwestern Reporter, Page 643. The law requires each taxpayer to make a veri- fied return of his money and credits on the listing blank furnished him by the assessor. Even though he does not own any of this class of property he should return his list to the assessor setting out such fact duly sworn to. The assessor is required to accept as true the items of the list so returned, unless the person mak- ing such return refuses to answer on oath all rea- sonable and necessary inquiries as to the nature and amount of his property taxable under the law. The assessor may, however, place his own valuation on the property so listed when in his judgment the valuation returned by the owner is not the full and true value of such property. If any person, firm or corporation subject to tax- ation under this law fails or refuses to make a return as provided for in Section 2 of the Act, it Is the duty of the assessor to ascertain as nearly as pos- sible the particulars of this class of property owned by such person, and to estimate its just value "ac- cording to his best information and belief," and to so assess it, and then add 50 per cent to the valua- tion as a penalty for failure or refusal to list. In making an arbitrary assessment as provided for in Sections 7 and 8 of the Act, if the person against whom the arbitrary assessment is made was assessed for this class of property in 1911, the assessor cannot fix the amount this >year at less, but may make it more than the amount legally assessed against such person last year. When a person subject to this tax has removed from one district to another within the state since the last assessment was made, and falls to make a return of such property, the assessor is required to assess such person at an amount not less than that for which he was assessed last year in the district from which he removed, which amount Is to be ascer- tained from the county auditor of the county in which such district is located. In making an arbitrary assessment the law does not require the assessor to have exact knowledge of , the value of the property; he is authorized to make the assessment upon "his best information and belief." If he should overvalue such property, the fault is not in the assessor, but in the person who failed to list. The verified list should be returned to the assessor on or before June 1. The assessment under this law is reviewed and equalized in the same manner as the assessment of other personal property is reviewed and equalized. 4 CHAPTER 285, LAWS OF MINNE- SOTA, 1911. An Act Establishing a Uniform Tax on Certain Classes of Personal Property. Be It Enacted by . the Legislature of the State of Minnesota: Section 1. "Money" and "Credits" as the same are defined in Section 798, "Revised Laws of 1905." are hereby exempted from taxation other than that imposed by this act and shall hereafter be subject to an annual tax of three mills on each dollar of the fair cash value thereof. But nothing in this act shall apply to money or credits belonging to incorporated banks situated in this state, nor to any indebtedness on (vhich tax is paid under Chapter 328, General Laws of 1907. Sec. 2. All "Money" and all "Credits" taxable under this act shall be listed in the manner provided in Section 816, "Revised Laws of 1905," but such listing shall be upon a separate blank from that upon which other personal property is listed. Sec. 3. Before making an assessment of "Money" and "Credits" under this act the assessor shall give seasonable notice to the inhabitants of his district in the manner prescribed in Section 808, "Revised Laws of 1905." He shall require each individual, co-partnership, company, association or corporation in his district to bring in before a date therein speci- fied and not later than the first day of July a true list of all their "Moneys" and "Credits" taxable under this act. Sec. 4. The Minnesota Tax Commission shall annually prepare instructions for bringing in the lists required by the preceding section. They shall prepare and distribute through the County Auditors to the Assessors a form for the returns which the taxpayers are required to make by this act, and this form shall be printed on a separate sheet, and shall be entirely distinct from the forms prepared for the returns of other classes of property. This form shall require the taxpayer to make a return of the total amount of his "Money" and "Credits" taxable under this act. The Minnesota Tax Commission shall cause to be printed and shall furnish assessors blank lists for the return of property taxable under this act, and the assessor shall distribute a blank list to every person liable to taxation. Sec. 5. The assessor shall in all cases require a person bringing in a list to make oath that it is as nearly correct as he is able to make it and this oath shall be attached to and be a part of such list. Such list shall be open to the inspection of the assessor, county auditor, their deputies and clerks, the board of review, the board of equalization, their clerics, the Minnesota Tax Commission and its assist- ants and clerks, but the details of the lists made by taxpayers shall be disclosed to no other person except by order of Court, and any assessor or other person who shall disclose such details shall be liable to a fine of not less than one hundred dollars, nor more than five hundred dollars. The lists shall be delivered by the assessor to the County Auditor and by him preserved. Sec. 6. The assessors shall receive as true except as to valuation, the list brought in by each person, unless on being thereto required by tho assessor he refuses to answer on oath all reasonable and necessary inquiries as to the nature and amount of his property taxable under the provisions of this Act. Sec. 7. The assessor shall ascertain as nearly as possible the particulars of the personal estate sub- ject to taxation under this Act of any person who has not brought in such list, and shall estimate its just value according to his best information and belief. He shall also add thereto fifty per cent of the estimated value of such property as a penalty; and such estimate, with the, penalty of fifty per cent, shall be entered in the valuation books, and shall be conclusive upon any person who has not season- ably brought in a list of his estate unless he can show reasonable excuse for the omission. Sec. 8. In making such estimate the assessor shall specify the amount of "Money" and "Credits" sepa- rately and shall enter the same upon the books fur- nished under the provisions of Section 10 of this Act. An error or overestimate, or either, shall not be taken into account in determining whether a person is entitled to abatement, but only the aggregate amount of such estimate. Sec. 9. After property taxable under the provi- sions of this Act has been legally assessed to any inhabitant of the State of Minnesota, including any executor, administrator, or trustee, an amount not less than that last assessed by the assessor of such district in respect of such property shall be deemed to be the sum assessable, until a true list of such property is brought in to the assessor in accordance with the provisions of Section 3 of this Act. When a person liable to be taxed for personal property included within the provisions of this Act changes his domicile, the assessor of the district to which he removes shall assess him for an amount not less than that for which he was assessed in the district from which he removed, until he files the list re- quired by Section 3, of this Act. The duties of as- sessors under this section shall be the same as pre- scribed in Section 858, Revised Laws of 1905, and whoever neglects to perform any duty imposed upon him by this Section shall be guilty of a misdemeanor. Sec. 10. Property taxable under this act shall not be included in the valuation list which assessors are required to make under the provisions of Section 835, Revised Laws of 1905, but shall be listed in a separate book or in a supplement to the regular assessment book which the County Auditor shall pro- vide for each assessor on or before the first day of May each year. This book or supplement, shall show the total amount of "Money" and "Credits" assessed to each taxpayer under the provisions of this Act, and shall not disclose further details of his assessment. It shall contain also a summary showing the number of individuals, firms, associations, trustees, etc., assessed for such property and the total amount of "Money" and "Credits" taxable under the provisions of this Act. When making the return to the County Auditor provided for by Section 850, Revised Laws of 1905, the assessor shall file this valuation book, or supplement, together with the summary of the same and the listing blanks filled out by each tax- payer assessed under the provisions of this Act. The County Auditor, when compiling the returns required by Section 862, Revised Laws of 1905, shall include, under a separate heading the aggregate assessment in each district of property assessed under the provisions of this Act. Sec. 11. The assessment under this Act shall be reviewed and equalized the same as the assessment of other personal property is reviewed and equalized. Sec. 12. The County Auditor of each County shall compute the taxes under this Act each year against each individual, co-partnership, company, association or corporation and he may include such tax on the personal property tax list with the other personal property tax levied against such individual, co- partnership, company, association or corporation where the assessment is made. The tax levied under this Act shall be collected by the County Treasurer, or Sheriff, the same as other personal property taxes are collected. Sec. 13. All taxes paid to the County Treasurer under the provisions of this Act shall be apportioned, one-sixth to the Revenue Fund of the State of Minne- sota, one-sixth to the County Revenue Fund, one- third to the City, Village or Town, and one-third to the School District in which the property is assessed. Sec. 14. This Act shall take effect and be in force from and after its passage. DECISION OF THE SUPREME COURT. 17440. STATE OF MINNESOTA, SUPREME COURT, OC- ' TOBER TERM, A. D. 1911. No. 12. STATE OP MINNESOTA ex rel; WINONA MOTOR CO., Relator vs. MINNESOTA TAX COMMISSION, Respondent. SYLLABUS. 1. Chap. 285, Laws 1911, providing for the taxation of money and credits, held a complete revision of prior statutes upon the subject, and that it was designed by the legislature as the exclusive guide upon that subject, save as provisions of the general tax laws are therein referred to and called to the aid of the new statute, and to repeal by implication Sec. 836, R. L. 1905, which provides for the deduction of debts from credits listed for taxation. 2. The classification of money and credits for the purposes of taxation held not a violation of the con- stitution. Writ discharged. Opinion. Relator, a corporation, properly listed its "credits" for taxation under and pursuant to chapter 285, Laws 1911, and claimed the right to have its debts deducted therefrom under the provisions of Sec. 836, R. L. 1905. This claim was duly presented to the State Tax Commission in the form of an application for an abatement, but was not sustained by the Com- mission. The tax was ordered levied for the value of the listed credits as fixed by the assessor, and relator sued out this writ of certiorari to review the action and decision of the commission. It is contended by relator: (1) That the commission erred, to the prejudice of relator's legal rights, in refusing to deduct its debts from the listed credits; and (2) that, if the act of 1911 be construed as repeal- ing by implication Sec. 836, R. L. 1905, providing for the deduction, it is unconstitutional and void. 1. Prior to the passage of Chap. 285, Laws 1911, the statute h€re under consideration, it had been the uniform policy of the state, whether rightfully or otherwise, is not material, to allow a deduction of debts from an assessment of taxes upon credits, and Sec. 836, R. L. 1905, so providing, has remained sub- stantially In Its present form since 1860. Since that year credits have been taxable on the basis of their net value, arrived at by a deduction of debts. The substantial question in the case is whether that policy was departed from by the act of 1911. The attempt to tax credits has never been either success- ful or entirely satisfactory, and the statutes pro- viding therefor have been of little value as revenue producers. The value of unsecured debts Is at most uncertain, many being concededly, wholly worthless, and attempts of the state to tax them at the rate imposed upon other classes of property have resulted In efforts to evade a proper listing and more or less laxity on the part of assessors. This situation and the generally unsatisfactory operation of prior statutes authorizing this class of taxation led the leg- islature to attempt an improvement, and the act under consideration was the result of its labors in that behalf. The new statute makes no reference to the deduction of debts, and contains no clause or section repealing other enactments upon the subject, and the ultimate inquiry upon this branch of the case is whether Sec. 836, R. L. 1905, which provides for such deductions, was repealed by implication. We have given the subject careful consideration and reach the conclusion that the question must be answered in the aflarmatlve. The new statute contains thirteen sections, all substantially original, and covering the entire sub- ject of taxing money and credits. It was evidently drawn with care and intended as a complete revision of all prior statutes, and as a departure in point of substance and procedure from the former method of such taxation. In connection with references therein expressly made to sections and provisions of prior statutes it presents a comprehensive worltable sys- tem for the levy and collection of the tax imposed. The hrst section adopts the definition of "credits" as found In Sec. 798, R. L. 1905, and provides that such credits "shall hereafter he subject to an annual tax of three mills on each dollar of the fair cash value thereof." All following sections relate to the pro- cedure for the assessment and collection of the tax, calling to the aid of the act several sections of the Revised Laws of 1905, but making no reference directly or indirectly to the question of deductions provided for by Sec. 836. The act Is so complete and so fully covers the subject as to bring it within the general rule of Implied repeal of all prior statutes upon the subject which are not expressly referred to and made a part of the new law. This rule applies though the new statute contains nothing expressly repugnant to some pertinent provisions found in prior statutes. The inquiry is : Did the legis- lature intend the new statute as the only rule upon the subject-matter of the legislation? Nicol vs. St. Paul, 80 Minn., 415. If the present statute had been in the form of amendments to former statutes, the situation would be different. In such cases no infer- ences necessarily arise, there being no repugnancy or inconsistency between the old and the amended statute, that any change in the law was intended except as expressly made. But here the new statute is complete in itself, and comes clearly within the rule of implied repeal. There can be no serious question but that the legislature intended a modifica- tion of the policy of the state in respect to this form of taxation. The lawmakers recognized the diflicul- ties encountered under the old system, and to avoid tile injustice of taxing credits at the rate imposed upon other property, the new system was devised and the tax laid and fixed at a very low rate. If there had been any intention to continue in force the policy of allowing the deduction of debts, the rate would undoubtedly not have been changed, and the reduction thereof to a minimum is fairly indica- tive of a purpose, as disclosed in section one, to tax all credits at their fair cash value, without reference to debts and obligations of the person listing the 10 same. ' This complete revision of the law brings the statute fairly within our decisions holding to the rule of implied repeal. Smith vs. County, 37 Minn., 535; State vs. Ry. Co., 40 Minn., 353; Ellington vs. Ry. Co., 96 Minn., 176; Kelly vs. City, 83 Minn., 9; Dunnell's Digest, 8927. Though this result leads to a departure of the long-settled policy of the state to allow the deduction of debts In taxation of this kind, that policy was at Its inception of doubtful merit, in that It extended to one class of taxpayers a favor not granted to others. It permitted the taxpayer holding credits to deduct his debts from the amount of his assessment, and denied the right to any owner of other property who was also in debt. In fact the Attorney General expressly disapproved of this policy when first adopted. Op. Atty. Gen.; 148-150. While both courts and legislatures should hesitate before departing from a long-settled policy of the law, the cause for hesitation arises more particularly when the departure is from a policy having a sound and substantial basis, and not one of doubtful merit, or, to use the language of General Cole, in the opinion above referred to, a policy that amounts to "a palpable violation of the constitution." Our conclusion therefore upon this branch of the case, is that the act of 1911 was intended by the legislature as a new rule in respect to the taxation of money and credits, tnat the statute is a complete revision of prior enactments, and repeals by implica- tion Sec. 836. 2. The further contention that the statute as so construed is unconstitutional, because the classifica- tion violates Sec. 1 of Article 9 of the State Constitu- tion, requires no extended discussion. We have no doubt, under the amended constitution, that the classification of money and credits for the purposes of taxation is within the discretion of the legislature, and that this act is a fair exercise thereof. It is not unreasonable, and the nature and character of the property suggests the propriety of a separate method for its assessment. The question is fully coverec Ins. Co. vs. Martin Co., 104 Minn., 179. A furl discussion of the question would serve no useful pose, but result only in a repetition of what has I said before upon the same general subject, and therefore conclude by holding the objections to constitutionality of the statute not well taken. Writ discharged. BROWN, J. P. E. Brown, J., absent on account of illness, t no part. ^^^^^1^^^