TERRELL v. McDONALD, 32 Ariz. 30 (1927)

255 P. 485

J.W. TERRELL, Appellant, v. RALPH L. McDONALD, as Marshal of the Town of Tempe, Appellee.

Civil No. 2538.Supreme Court of Arizona.
Filed April 25, 1927.

1. LICENSES — ORDINANCE REQUIRING HARDWARE ESTABLISHMENTS AND OTHER BUSINESSES TO PAY GRADUATED LICENSE TAX HELD VALID (CIV. CODE 1913, PAR. 1831, SUBD. 22). — Ordinance passed by town council requiring every hardware establishment, among other businesses, to pay quarterly license tax, graduated by average sales, and making it misdemeanor to carry on such business without license, held valid, under Civil Code of 1913, paragraph 1831, subdivision 22, providing that common councils shall have power to license, tax and regulate occupations and businesses, expressly including hardware merchants.

2. LICENSES — LEGISLATURE MAY EXERCISE OR GRANT TO CITIES OR TOWNS POWER TO TAX BUSINESSES OR OCCUPATIONS, IN ABSENCE OF CONSTITUTIONAL PROHIBITION. — Legislature has right to exercise, or to grant to cities or towns, power to exact a graduated quarterly license tax on businesses and occupations, in absence of constitutional prohibition against taxing occupations or trades.

3. LICENSES — TAX FOR CARRYING ON BUSINESS OR OCCUPATION IS NOT “PROPERTY TAX.” — Tax exacted for privilege of engaging in a business or occupation is not a “property tax.”

4. LICENSES — TAXATION BOTH OF PROPERTY USED IN BUSINESS AND ON PRIVILEGE OF ENGAGING IN BUSINESS IS NOT “DOUBLE TAXATION” Fact that property tax is paid on property used in a business does not render tax exacted for engaging in the business “double taxation.”

See (1, 2) 37 C.J., p. 174, n. 95, p. 175, n. 3, 11, p. 176, n. 27, p. 185, n. 75. (3, 4) 37 C.J., p. 171, n. 57, p. 211, n. 33.

[1] Graduation of license fees, see note in 30L.R.A. 421. See, also, 16 Cal. Jur. 235.

[2] Imposition of license taxes by municipal corporations, see notes in 129 Am. St. Rep. 267; 2 Ann. Cas.
313. See, also, 16 Cal. Jur. 211; 17 R.C.L. 524.

[3] Distinction between “property tax” and “excise tax,” see note in Ann. Cas. 1914B, 643. See, also, 16 Cal.Jur. 189; 17 R.C.L. 478.

[4] License tax as double taxation, see note in 129Am. St. Rep. 264. See, also, 16 Cal. Jur. 199; 17 R.C.L.

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APPEAL from a judgment of the Superior Court of the County of Maricopa. Joseph S. Jenckes, Judge. Affirmed.

Mr. V.L. Hash, for Appellant.

Mr. Raymond H. Alexander and Messrs. Stockton Perry, for Appellee.


The common council of the town of Tempe passed an ordinance requiring that every hardware establishment, among other businesses or occupations, pay a quarterly license tax, graduated upon the average sales of such establishment, and made it a misdemeanor for any person to carry on such business or occupation without procuring a license.

The appellant, Terrell, was convicted, in the police court of said town, of violating such ordinance and fined fifty dollars, and in default thereof sentenced to imprisonment in the jail of said town at the rate of one dollar a day. Thereupon he sought his discharge from custody by writ of habeas corpus, and, being denied such relief, he has appealed.

We find it pretty hard to follow his reasons for contending that he is illegally deprived of his liberty, but, generally, he bases his claim on the invalidity of the ordinance he is charged with breaking. It seems to us, however, that the ordinance is valid. Subdivision 22, paragraph 1831, Civil Code of 1913, provides that common councils shall have the power within the limits of their towns “to license, tax, and regulate” a great number of occupations and businesses, and among them it mentions hardware merchants. Under this legislative authority the ordinance was passed. The town council exercised a power expressly granted it. We think there can be no question

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as to the right of the legislature to grant such power to the cities and towns of the state. Such power was expressly recognized by this court in McCarthy v. City of Tucson, 26 Ariz. 311, 225 P. 329, wherein an ordinance requiring practicing attorneys to pay a license tax was held to be a revenue measure and valid. That the ordinance here attacked is a revenue measure there can, we think, be no question.

We have no constitutional prohibition against taxing occupations or trades, and hence the exercise of such power is left with the legislature, to be exerted either directly or delegated to the municipalities of the state.

The tax exacted for the privilege of engaging in a business or occupation is not a property tax, as contended by appellant, and the fact that a property tax is paid upon the property used in the business is not regarded as constituting double taxation. For a clear statement of the law bearing upon the last two propositions, we cite the opinion of Mr. Justice BREWER, in City of Newton v. Atchison, 31 Kan. 151, 47 Am. Rep. 486, 1 P. 288.

We are satisfied that the order of the court quashing the writ of habeas corpus was proper, and that the appeal is without merit.

The judgment of the lower court is affirmed.

LOCKWOOD and McALISTER, JJ., concur.

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