Also, a State may impose a tax upon the net income of property, as distinguished from the net income of him who owns or operates it, although the property is used in interstate commerce;[720] also a "franchise tax" measured by the net income justly attributable to business done by corporations within the State, although part of the income so attributable comes from interstate and foreign commerce;[721] also a tax on corporate net earnings derived from business done wholly within the State may be applied to the income of a foreign pipeline corporation which is commercially domiciled there and which pipes natural gas into that State for delivery to, and sale by, a local distributing corporation to local consumers.[722] Indeed it was asserted that even if the taxpayer's business were wholly interstate commerce, such a nondiscriminatory tax upon its net income "is not prohibited by the commerce clause," there being no showing that the income was not on net earnings partly attributable to the taxing State;[723] but a more recent holding appears to contradict this position.[724]
MISCELLANEOUS TAXES AFFECTING INTERSTATE COMMERCE
Vessels
In Gloucester Ferry Company v. Pennsylvania,[725] decided in 1885, the Court held inapplicable to a New Jersey corporation which was engaged solely in transporting passengers across the Delaware River and entered Pennsylvania only to discharge and receive passengers and freight, a statute which taxed the capital stock of all corporations doing business within the State. Such transactions, the Court held, were interstate commerce; nor were the company's vessels subject to taxation by Pennsylvania, their taxing situs being in the company's home State. The only property held by the company in Pennsylvania was the lease there of a wharf which could be taxed by the State according to its appraised value; and the State could also levy reasonable charges by way of tolls for the use of such facilities as it might itself furnish for the carrying on of commerce. This ruling rested on two earlier ones. In 1855, the Court had held that vessels registered in New York, owned by a New York corporation, and plying between New York City and San Francisco had the former city for their home port, and were not taxable by California where they remained no longer than necessary to discharge passengers and freight;[726] and in 1877 it had sustained Keokuk, Iowa in charging tolls for the use by vessels plying the Mississippi of wharves owned by the municipality, said tolls being reasonable and not discriminatory as between interstate and intrastate commerce.[727] Today it is still the general rule as to vessels plying between ports of different States and engaged in the coastwise trade, that the domicile of the owner is deemed to be the situs of the vessel for purposes of taxation,[728] unless the vessel has acquired actual situs in another State, by continuous employment there, in which event it may be taxed there.[729] Recently, however, this long standing rule has been amended by the addition to it of the apportionment rule as developed in the Pullman case. This occurred in Ott v. Mississippi Barge Line Co.,[730] decided in 1949, in which the Court sustained Louisiana in levying an ad valorem tax on vessels owned by an interstate carrier and used within the State, the assessment for the tax being based on the ratio between the number of miles of the carrier's lines within the State and its total mileage.
Airplanes
When, however, it was confronted by an attempt on the part of the State of Minnesota to impose a personal property tax on the entire air fleet owned and operated by a company in interstate commerce although only a part of it was in the State on tax day, the Court found itself unable to recruit a majority for any of the above formulas.[731] Pointing to the fact that the company was a Minnesota corporation and that its principal place of business was located in the State, Justice Frankfurter for himself and three others wished to stress the prerogatives of the State of domicile.[732] Justice Black, concurring in this view, added the caveat that the taxing rights of other States should not be foreclosed and made reference to his "leave it to Congress" notion.[733] Justice Jackson, after speaking lightly of the apportionment theory,[734] joined the affirming brethren on the ground that the record seemed "to establish Minnesota as a 'home port' within the meaning of the old and somewhat neglected but to me wise authorities cited," to wit, the Hays case and those decided by analogy to it.[735] Four Justices, speaking by Chief Justice Stone dissented, urging the Pullman Case[736] as an applicable model and the fact that "the rationale found necessary to support the present tax leaves other States free to impose comparable taxes on the same property."[737] Evidently in this area of Constitutional Law the Court is still much at sea or better perhaps, "up in the air."
Motor Vehicles
In the matter of motor vehicle taxation, on the other hand, durable and consistent results have been achieved. This is because most such taxation has been readily classifiable as the exaction of a toll for the use of the State's highways, and the only question was whether the toll was exorbitant. Moreover, such taxation is apt to be designed not merely to raise revenue but to promote safety on the highways. In the leading case, Hendrick v. Maryland,[738] decided in 1915, the Court took cognizance of the fact that "the movement of motor vehicles over the highways is attended by constant and serious dangers to the public, and is also abnormally destructive to the ways themselves";[739] and on this factual basis it has held that registration may be required by a State for out-of-State vehicles operated therein,[740] or passing through from one State to another;[741] that a special fee may be exacted for the privilege of transporting motor vehicles on their own wheels in caravans,[742] unless excessive;[743] that taxes may also be imposed on carriers based on capacity[744] or mileage,[745] or as a flat fee;[746] but that a privilege tax on motor busses operated exclusively in interstate commerce, cannot be sustained unless it appears affirmatively in some way, that it is levied only as compensation for use of the highways in the State or to defray the expense of regulating motor traffic.[747] Later decisions follow in the same general track,[748] the most recent one being Capitol Greyhound Lines v. Brice,[749] in which the Court, speaking by Justice Black passed upon a Maryland excise tax on the fair market value of motor vehicles used in interstate commerce as a condition to the issuance of certificates of title as prerequisites to the registration and operation of motor vehicles in the State. Because the tax was applied to vehicles used in both interstate and intrastate commerce and the proceeds were used for road purposes and because the Court considered the tax, though actually separate, to be an adjunct of Maryland's mileage tax, it was able to find that the total charge varied substantially with the mileage travelled, and on that ground sustained it, being constant, it said with "rough approximation rather than precision," no showing having been made that Maryland's taxes considered as a whole exceeded "fair compensation for the privilege of using State roads." Justice Frankfurter, who was joined by Justice Jackson, dissented, and in so doing contributed as an Appendix to his opinion a useful analysis of decisions involving State taxation of motor vehicles engaged in interstate commerce, for highway purposes.[750]
Public Utilities; Regulatory Charges
"The principles governing decision [in this class of cases] have repeatedly been announced and were not questioned below.[751] In the exercise of its police power the State may provide for the supervision and regulation of public utilities, such as railroads; may delegate the duty to an officer or commission; and may exact the reasonable cost of such supervision and regulation from the utilities concerned and allocate the exaction amongst the members of the affected class without violating the rule of equality imposed by the Fourteenth Amendment.[752] The supervision and regulation of the local structures and activities of a corporation engaged in interstate commerce, and the imposition of the reasonable expense thereof upon such corporation, is not a burden upon, or regulation of, interstate commerce in violation of the commerce clause of the Constitution.[753] A law exhibiting the intent to impose a compensatory fee for such a legitimate purpose is prima facie reasonable.[754] If the exaction be so unreasonable and disproportionate to the service as to impugn the good faith of the law[755] it cannot stand either under the commerce clause or the Fourteenth Amendment.[756] The State is not bound to adjust the charge after the fact, but may, in anticipation, fix what the legislature deems to be a fair fee for the expected service, the presumption being that if, in practice, the sum charged appears inordinate the legislative body will reduce it in the light of experience.[757] Such a statute may, in spite of the presumption of validity, show on its face that some part of the exaction is to be used for a purpose other than the legitimate one of supervision and regulation and may, for that reason, be void.[758] And a statute fair upon its face may be shown to be void and unenforceable on account of its actual operation.[759] If the exaction be clearly excessive it is bad in toto and the State cannot collect any part of it."[760]