returns made by the company to the above officials were correct, and that the aggregate value of the items included in such returns liable to taxation in 1895—the same as other like property in the State—was $42,065. The board of appraisers and assessors added, however, to this amount the sum of $491,030, making the aggregate of the tax liability of the express company $533,095; and based their action not on any belief or pretense that any considerable amount of real or personal property within the territorial jurisdiction of the State had been discovered which had hitherto escaped taxation, but that sources of reported value which were entirely outside of the territory and beyond the jurisdiction of the State of Ohio—when they constituted a part of the value of the capital or franchise of a corporation located and established in some other State for the purpose of carrying on business, and that business "interstate commerce" entirely within the control of the Federal Government—might be added to the intrinsic value of property within the State; thereby assessing not only property within the State of Ohio, but a proportion also of all property situated without its territorial boundaries. The question involved was therefore the constitutionality of extraterritorial taxation; and the case, after consideration by State and United States Circuit Courts, was finally brought before the United States Supreme Court. Here, notwithstanding the citation of numerous former opinions and judgments of the court wholly adverse to the constitutionality of the principle on which was based the assumption and action of the State of Ohio, the court by a majority of one held to a contrary view; and gave judgment in support of the State assessments on the express company. It is clear, therefore, that the State of Ohio has been justified, for the time being, in an attempt to tax something that it calls property, but which is neither tangible nor visible; that has no intrinsic or essentially inherent value; and which procedure, if generally accepted and put in practice by other States, would antagonize all formerly accepted theories and legal decisions in respect to extra-territorial taxation, and ultimately destroy all interstate commerce between the several States of the Federal Union. An Implied but Fundamental Reciprocal of Taxation.—Notwithstanding the absence of any warrant for assuming that there was ever any real or implied contract, whereby a State in its beginning or development agreed to give a certain amount of protection to life and property in return for an equivalent in money, goods, or services of its citizens an assumption which has been characterized as the "commercial theory of taxation"[1]—
- ↑ "The right of a state to take the citizen's property must be put on higher ground if it is to stand on perfectly safe ground. Of course, such higher ground is not to be found
