Summary
In Butcher v. Philadelphia, 333 Pa. 497, 6 A.2d 298 (1938), by per curiam opinion, the Supreme Court declared: "Under the severability clause in the income tax ordinance... the majority, one Justice disagreeing, hold that the income tax ordinance is constitutional, with all exemptions stricken out, including the credit for making and filing the return.
Summary of this case from Amidon v. KaneOpinion
December 2, 1938.
December 5, 1938.
Constitutional law — Taxation — Income — Municipal corporations — Exemptions — Severability clause.
An ordinance of the City of Philadelphia [repealed] providing for a municipal income tax was held to be constitutional, under its severability clause, with all exemptions stricken out, including a credit for making and filing the return; and it was held that the ordinance must be read as though such exemptions and credit for making and filing the return were not included.
Argued December 2, 1938.
Before KEPHART, C. J., SCHAFFER, MAXEY, DREW, LINN, STERN and BARNES, JJ.
Original jurisdiction, in equity, Jan. T., 1938, No. 443, No. 92 Miscellaneous Docket No. 7, in case of Harry K. Butcher v. City of Philadelphia et al.
REPORTER'S NOTE.An ordinance passed by the city council of Philadelphia and approved by the mayor on November 26, 1938, imposed an annual tax at the rate of 1 1/2% on salaries, wages, etc., and other compensation earned by residents of Philadelphia and on the net profits of business or other activities conducted by such residents; and upon salaries, wages, etc., and other compensation earned by nonresidents of Philadelphia for work done or services performed in the city and on the net profits of business or other activities conducted in Philadelphia by nonresidents. The ordinance provided for the filing of annual returns by taxpayers and employers, and imposed penalties for violations. It was further provided that domestic servants in private homes, farm laborers or farmers selling their own products should not be included within the meaning of "taxpayer" as used in the ordinance; that each taxpayer should receive a credit of $15.00 upon making and filing the return required under the ordinance; and that the amount of taxes paid to the city on the taxpayer's residence, whether paid by the taxpayer or another, or a proportionate part of such taxes if the taxpayer occupied but a part of the premises, could be deducted as a credit from the total amount of the tax imposed by the ordinance.
Plaintiff filed a bill in equity to restrain enforcement of the ordinance. Upon petition, original jurisdiction was taken by the Supreme Court.
The ordinance was repealed by city council on January 7, 1939.
W. Barclay Lex, with him Philip Price and J. Alan Montgomery, Jr., for plaintiff.
Abraham L. Shapiro, with him Abraham Wernick, Assistant City Solicitors, and Joseph Sharfsin, City Solicitor, for defendants.
Under the severability clause in the income tax ordinance, which reads as follows: "SECT. 12. CONSTRUCTION. If any sentence, clause or section or part of this ordinance is for any reason found to be unconstitutional, illegal or invalid, such unconstitutionality, illegality or invalidity shall not affect or impair any of the remaining provisions, sentences, clauses or sections or parts of this ordinance. It is hereby declared as the intent of the Council that this ordinance would have been adopted had such unconstitutional, illegal or invalid sentence, clause, section or part thereof not been included herein," the majority, one Justice disagreeing, hold that the income tax ordinance is constitutional, with all exemptions stricken out, including the credit for making and filing the return, and the ordinance must be read as though such exemptions and credit for making and filing the return were not included. It is assumed that regulations will be promulgated under Section 6 of the ordinance, providing that the tax be collected at its source.