Pate v. Foss

Bussell, C. J. (After stating the foregoing facts.) The question in this case concerns the constitutionality of § 27 of the tax act of 1921 (Acts 1921, p. 45). By this section there is imposed “Upon each person, firm, or corporation engaged in the business of procuring or signing bonds, or depositing collateral in lieu of bonds for compensation, except duly authorized bonding companies and duly authorized officers of this State who are required to give bond to qualify as such officers, $200.00 in each county.” It is argued that bonding companies engaged in the same business as those who are taxed under § 27 of the act are relieved from payment of any tax, and that thereby the petitioners, defendants in error, are subjected to unjust discrimination, thereby contravening the due-process and equal-protection clauses of the fourteenth amendment to the constitution of the United States, as well as art. 7, sec. 1, par. 1, of the constitution of Georgia, providing for uniformity of taxation. The learned trial judge, as we think correctly, sustained this contention of the defendants in error. Prior to the passage of the act of 1921, supra, there' was a provision (Acts 1918, p. 80, sec 12), by which all guaranty companies or surety associations engaged in the business of furnishing bonds were required to pay “one per cent, of all premiums [583] . . received by them.” The contention is that since the passage of the tax act of 1921, the companies referred to are entirely relieved from the payment of any taxes upon an occupation identical with that in which the petitioners are engaged, and that by reason of this there is a discrimination against the petitioners and against such business in which they are engaged. The power of classification conferred upon the General Assembly must be uniform, and the effect of the provisions of section 27 of the act of 1921, supra, whereby bonding companies are relieved from any taxation is to render unconstitutional and void the provisions of that section whereby other persons engaged in the business of making and signing bonds are subjected to an annual tax of $200 in each county in which they conduct such business. As held in Wright v. Hirsch, 155 Ga. 229 (116 S. E. 795), the General Assembly is clothed with full power to classify, and, in classifying, to fairly adjust the burden of taxation upon the several classes, even of those who may be engaged in the same business, but it is not within the power of the General Assembly arbitrarily to place unequal burdens or discriminatory burdens against or in favor of one of the classes as compared with the other. To attempt to do this is to violate the constitution. It is not now necessary to decide the merits of a classification by which one class of bondmakers may be required to pay a lump sum as an occupation tax to enable them to carry on that business, and to tax another class such as duly authorized bonding companies only upon the basis of a percentage of premiums received. But to tax one class of persons engaged in the business of making bonds at all when others engaged in the same business are entirely relieved is an exercise of a power not warranted by the constitution. “All taxation shall be uniform upon the same class of subjects.” It is argued by counsel for the plaintiffs in error that the exception, “except duly authorized bonding companies,” is a mere classification authorized by the constitution as construed in the Hirsch case, supra. The validity of this contention might be upheld if the legislature had provided against partiality and discrimination, by enacting a provision of some kind whereby bonding companies were subjected to the duty of paying their fair proportion of the burden of taxation, and whereby no discrimination would result as against other persons who may be engaged in the same or a similar business. Whereas not only [584] does the exception as contained in § 27 of itself show an intention to relieve-bonding companies from the burden imposed upon the petitioners and other persons engaged in the similar business of procuring bonds for patrons and clients, but an investigation of recent tax legislation demonstrates that bonding companies are entirely relieved from any charge for pursuing business of the same nature as that in which the petitioners are engaged. While it is true as a general rule that no law can be repealed except by direct reference to the legislation sought to be repealed, or by necessary implication arising from apparent repugnancy, this rule does not apply to general tax acts designed to raise revenue for the purposes of the State government from time to time, and according to the changing necessities and exigencies under changing conditions as the State may require less revenue or more than theretofore. It is a matter of judicial knowledge that the General Assembly of Georgia frames each tax act with a view to the governmental necessities for the next ensuing two years. Every general tax act is the result of a complete revision of all of the subjects of taxation and adjustment of the taxes to be levied, so as to raise equitably the funds actually necessary for the purpose of carrying on the government. Therefore when a provision such as § 12 in the act of 1918, supra, is entirely omitted from the succeeding tax act, the omission must be held to have been intentional and to have effected the repeal of the omitted provision in the previous statute. Therefore the omission of the previous provision as to the bonding companies as contained in the act of 1918, as well as the provision contained in § 27 of the act of 1921, demonstrates the purpose of the General Assembly, whether unwittingly or intentionally, to relieve from any taxation bonding companies engaged in a similar business with the petitioners, and thereby subject to classification and entitled to no more than fair treatment and a just tax; and the act thereby rendered the tax imposed upon the petitioners obnoxious to the constitution and void. The injunction was properly granted. Judgment affirmed by operation of law.