Opinion
No. 25026
Decided November 27, 1934.
Taxation — Excise tax on motor vehicle fuel — Sections 5527 and 5541, General Code (115 Ohio Laws, 629, 630) — Transfer of funds for poor relief — Sections 1 and 2 of Amended Senate Bill No. 61 (115 Ohio Laws, 26) — Statutory construction — Repeal by implication — Later legislation removed poor relief as one purpose of the tax — Section 5, Article XII, Constitution — Taxes applied only to object of law imposing the tax.
1. Sections 1 and 2 Amended Senate Bill No. 61, 115 Ohio Laws, 26, being inconsistent and irreconcilable with Sections 5527 and 5541, General Code, as amended by Amended Senate Bill No. 62, 115 Ohio Laws, 629, are repealed by implication.
2. The provisions of the two acts being in conflict, those of Amended Senate Bill No. 62 will prevail because that act is the later expression of the intention of the Legislature, and because it is more particular and specific in that it imposes the taxes which are the subject of the two acts.
3. To give effect to the provisions of Sections 1 and 2 of Amended Senate Bill No. 61, contrary to the provisions of Sections 5527 and 5541, General Code, as amended by Amended Senate Bill No. 62, would violate Section 5 of Article XII of the Constitution of Ohio.
ERROR to the Court of Appeals of Trumbull county.
This case comes to this court by petition in error filed as a matter of right and prays that the judgment of the Court of Appeals be reversed and the judgment of the Court of Common Pleas affirmed. The Court of Appeals enjoined the plaintiffs in error from transferring, diverting, or attempting to transfer or divert to poor relief purposes, any part of the motor fuel excise tax allocated to Trumbull county, or from using it for any other purpose than that expressly authorized by Sections 5527 and 5541 of the General Code.
The case was submitted in both courts upon the pleadings and a stipulation admitting the truth of all the averments of fact contained in the petition. An answer was filed, but the case was considered as submitted upon general demurrer.
The petition contained the essential allegations of a suit by a citizen and taxpayer to enjoin the misapplication of public funds. No question as to procedure was raised. The issue turned upon an interpretation of Sections 1 and 2 of Amended Senate Bill No. 61 (115 Ohio Laws, 26), and Sections 5527 and 5541, General Code, as amended by Amended Senate Bill No. 62 (115 Ohio Laws, 629), and questioned the constitutionality of Sections 1 and 2 of Amended Senate Bill No. 61.
Amended Senate Bill No. 61 was passed by the Legislature on February 27, 1933. It is as follows:
(Provisions in question are italicized.)
"Section 1. That sections 1 and 2 of Amended Senate Bill No. 3, enacted at the special session of the 89th General Assembly, approved April 5, 1932, and filed in the office of the secretary of state April 6, 1932, entitled 'An act to provide for the expenditure of gasoline and motor vehicle license tax funds in counties, cities and townships for poor relief purposes, to amend sections 5527, 5541 and 6291 of the General Code, and to declare an emergency'; and sections 5527 and 5541 of the General Code, be amended to read as follows:
"Sec. 1. In addition to the purposes specified in sections 5527 and 5541 of the General Code, for which the proceeds of the gasoline taxes, allocated under existing law to counties and cities, may be expended, at any time prior to the first day of March, 1935, the whole or any part of the proceeds of the gasoline taxes allocated under existing law to counties and cities, hereafter received may, by action of the county commissioners of any county or the council of any city, with the approval of the state relief commission, be expended for work or poor relief within such subdivision. The taxing authority of such subdivision shall adopt and submit to the state relief commission, a statement in such form as the commission shall prescribe, of the amount proposed to be so expended and the particular type or types of relief proposed to be rendered. Two or more copies of such statement shall be filed in the office of the fiscal officer of the subdivision for public inspection not less than five days before its adoption by the taxing authority; and such taxing authority shall hold one or more public hearings thereon, of which notice shall be given not less than five days previous to the date thereof, by publication in the official publication of such subdivision or in a newspaper having a general circulation in such subdivision. "Sec. 2. At any time prior to the first day of March, 1935, the county commissioners of any county may, upon approval of the state relief commission, transfer to cities or townships in such county, all or any part of the proceeds of the gasoline taxes hereafter collected and allocated under existing laws to the county, such funds to be used for work or poor relief in the subdivision to which they are allocated and for no other purpose.
"Sec. 5527. For the purpose of providing revenue for maintaining the state highway system of this state in passable condition for travel, for repairing the damage caused to such highway system by motor vehicles used on the same, for widening existing surfaces on such highways where such widening is rendered necessary by the volume of motor vehicle traffic thereon, for resurfacing such highways where existing surfaces have become worn or rutted, for enabling the several counties of the state properly to maintain and repair their roads and for enabling the several municipal corporations of the state properly to maintain, repair, construct and repave their streets, and supplementing revenue already available for such purposes and arising from direct taxation and from registration fees of motor vehicles, and for distributing equitably upon those persons using the privileges of driving such motor vehicles upon such highways and streets a fair share of the cost of maintaining and repairing the same, and as to the tax levied between the effective date of this act, and March 1, 1935, for the purpose of providing poor relief in the various counties of this state, an excise tax is hereby imposed on all dealers in motor vehicle fuel upon the use, distribution or sale within this state by them of motor vehicle fuel at the rate of two cents (2¢) per gallon so used, distributed or sold, to be computed in the manner hereinafter set forth; provided, however, that no tax is hereby imposed upon or with respect to the following transactions:
"(a) The sale of motor vehicle fuel in tank car or cargo lots for delivery by tank car or boat for use wholly for purposes other than propelling motor vehicles on the public highways, or the use thereof wholly for such purposes when so purchased; or
"(b) The sale of motor vehicle fuel by a duly licensed dealer in tank car or cargo lots to another duly licensed dealer for delivery by tank car or boat; or
"(c) The exportation or sale for exportation of motor vehicle fuel from the state of Ohio to any other state or to any foreign country; or
"(d) The sale of motor vehicle fuel to the United States Government or any of its agencies; or
"(e) The sale of motor vehicle fuel which is in the process of transportation in foreign or interstate commerce, except insofar as the same may be taxable under the provisions of the constitution and statutes of the United States.
"After the excise tax herein provided for on the sale, distribution or use of any motor vehicle fuel has been paid by the dealer, such motor vehicle fuel may thereafter be used or sold or resold by any person having lawful title to the same, without incurring liability for such tax.
"Sec. 5541. For the purpose of providing revenue for supplying the state's share of the cost of constructing, widening and reconstructing the state highways of this state, and also for supplying the state's share of the cost of eliminating railway grade crossings upon such highways, and also for enabling the several counties, townships and municipal corporations of the, state property to construct, widen, reconstruct and maintain their public highways, roads and streets, and for paying the costs and expenses of the tax commission incident to the administration of the motor vehicle fuel laws, and supplementing revenue already available for such purposes, and as to the tax levied between the effective date of this act and March 1, 1935, for the purpose of providing poor relief in the various counties of this state, an excise tax is hereby imposed on all dealers in motor vehicle fuel, upon the use, distribution or sale within the state by them of motor vehicle fuel at the rate of two cents (2¢) per gallon so used, distributed or sold, subject to the specific exemptions therein set forth, to be reported, computed, paid, collected, administered, enforced and refunded, and the failure properly and correctly to report and pay same penalized in exactly the same manner as is provided in sections 5527 to 5536-1, both inclusive, of the General Code; and all of the provisions contained in said sections 5527 to 5536-1, both inclusive, of the General Code, relating to motor vehicle fuel excise taxes shall be, and the same hereby are reenacted and incorporated as if specifically set forth herein; which tax shall be in addition to the tax imposed under said sections 5527 to 5536-1 of the General Code.
"Section 2. That existing sections 1 and 2 of Amended Senate Bill No. 3, enacted at the special session of the 89th General Assembly, approved April 5, 1932, and filed in the office of the secretary of state April 6, 1932, and sections 5527 and 5541 of the General Code be, and the same are hereby repealed.
"Section 3. This act is hereby declared to be an emergency measure, necessary for the immediate preservation of the public peace, health and safety. The reason for such necessity lies in the fact that the conditions referred to still exist and the necessity for the expenditure of gasoline tax funds for poor relief purposes continues. Therefore, this act shall go into immediate effect."
Amended Senate Bill No. 62 was passed June 30, 1933, 115 Ohio Laws, 629. It is as follows:
Section 1. That sections 5527 and 5541 of the General Code be amended to read as follows:
"Sec. 5527. For the purpose of providing revenue for maintaining the state highway system of this state in passable condition for travel, for repairing the damage caused to such highway system by motor vehicles used on the same, for widening existing surfaces on such highways where such widening is rendered necessary by the volume of motor vehicle traffic thereon, for resurfacing such highways where existing surfaces have become worn or rutted, for enabling the several counties of the state to properly maintain and repair their roads and for enabling the several municipal corporations of the state properly to maintain, repair, construct and repave their streets, and supplementing revenue already available for such purposes and arising from direct taxation and from registration fees of motor vehicles, and for distributing equitably upon those persons using the privilege of driving such motor vehicles upon such highways and streets a fair share of the cost of maintaining and repairing the same, an excise tax is hereby imposed on all dealers in motor vehicle fuel upon the use, distribution or sale within this state by them of motor vehicle fuel at the rate of one and one-half cents (1 1/2¢) per gallon so used, distributed or sold, to be computed in the manner hereinafter set forth; provided, however, that no tax is hereby imposed upon or with respect to the following transactions:
"(a) The sale of motor vehicle fuel in tank car or cargo lots for delivery by tank car or boat for use wholly for purposes other than propelling motor vehicles on the public highways, or the use thereof wholly for such purposes when so purchased; or
"(b) The sale of motor vehicle fuel by a duly licensed dealer in tank car or cargo lots to another duly licensed dealer for delivery by tank car or boat; or
"(c) The exportation or sale for exportation of motor vehicle fuel from the state of Ohio to any other state or to any foreign country; or
"(d) The sale of motor vehicle fuel to the United States government or any of its agencies; or
"(e) The sale of motor vehicle fuel which is in the process of transportation in foreign or interstate commerce, except in so far as the same may be taxable under the provisions of the constitution and statutes of the United States.
"After the excise tax herein provided for on the sale, distribution or use of any motor vehicle fuel has been paid by the dealer, such motor vehicle fuel may thereafter be used or sold or resold by any person having lawful title to the same, without incurring liability for such tax.
"Sec. 5541. For the purpose of providing revenue for supplying the state's share of the cost of constructing, widening and reconstructing the state highways of this state, and also for supplying the state's share of the cost of eliminating railway grade crossings upon such highways, and also for enabling the several counties, townships and municipal corporations of the state properly to construct, widen, reconstruct and maintain their public highways, roads and streets, and for paying the costs and expenses of the tax commission incident to the administration of the motor vehicle fuel laws, and supplementing revenue already available for such purposes, an excise tax is hereby imposed on all dealers in motor vehicle fuel, upon the use, distribution, or sale within the state by them of motor vehicle fuel, at the rate of one and one-half cents (1 1/2¢) per gallon so used, distributed or sold, subject to the specific exemptions therein set forth, to be reported, computed, paid, collected, administered, enforced and refunded, and the failure properly and correctly to report and pay same penalized in exactly the same manner as is provided in sections 5527 to 5536-1, both inclusive, of the General Code; and all of the provisions contained in said sections 5527 to 5536-1, both inclusive, of the General Code, relating to motor vehicle fuel excise taxes shall be, and the same hereby are re-enacted and incorporated as if specifically set forth herein; which tax shall be in addition to the tax imposed under said sections 5527 to 5536-1 of the General Code.
"Section 2. That original and existing sections 5527 and 5541 of the General Code be, and the same are hereby repealed; Provided, however, that all of the provisions of said sections of the General Code shall remain in force for the reporting, assessment and collection of all taxes imposed thereby and for the assessment, imposition, and collection of all interest, fines and penalties which have accrued or may accrue in relation to said taxes."
Mr. George W. Secrest, prosecuting attorney, and Mr. Paul Z. Hodge, for plaintiffs in error.
Mr. Paul E. Kightlinger, for defendant in error.
The petition in error raises two legal questions:
(1) Do the provisions of Amended Senate Bill No. 61 (115 Ohio Laws, 26) empower the commissioners of Trumbull county, Ohio, to use the proceeds of gasoline tax funds allocated to that county for poor relief purposes, or are the provisions of Amended Senate Bill No. 61 repealed by the provisions of Amended Senate Bill No. 62 (115 Ohio Laws, 629)?
(2) If the provisions of Amended Senate Bill No. 61 granting authority to use gasoline tax funds for poor relief purposes are not repealed, are such provisions constitutional?
It will be observed that Senate Bill No. 62 expressly repealed original and existing Sections 5527 and 5541. It did not, however, expressly repeal Section 1 and Section 2 of Amended Senate Bill No. 61. In amending Section 5527 and Section 5541, the rate of tax was changed from two cents per gallon to one and one-half cents per gallon, and the following words were omitted from both Section 5527 and Section 5541: "And to the tax levied between the effective date of this act and March 1, 1935, for the purpose of providing poor relief in the various counties of this state". Thus the rate of the taxes was changed and poor relief was removed as one of the purposes of such taxes.
Because Sections 1 and 2 of Amended Senate Bill No. 61 were not expressly repealed, the officials of Trumbull county thought they were still in effect and authorized the diversion of gasoline and motor fuel excise taxes, levied and collected under Sections 5527 and 5541 as amended by Senate Bill No. 62, to the poor relief fund of the county. But both of the later sections provide that the purpose of such taxes is to maintain, repair and improve the roads. It is the contention of the defendant in error that since Sections 5527 and 5541 provide expressly that the taxes are for the purpose of providing revenue for maintaining, repairing and improving the public roads, the amendment of such sections in Senate Bill No. 62 repeals by implication Sections 1 and 2 of Senate Bill No. 61.
The rule is well established that repeals by implication are not favored. The presumption is against an intention to repeal an earlier statute unless there is such inconsistency or repugnancy between the statutes as to preclude the presumption. It is the opinion of this court that in this case such inconsistency and repugnancy exist. The clear statement of the purpose of the taxes in Sections 5527 and 5541, as amended in Senate Bill No. 62, is absolutely incompatible with the provisions of Sections 1 and 2 of Senate Bill No. 61. It is impossible to preserve the purpose as set out in Bill No. 62 and give effect to the provisions of Sections 1 and 2 of Bill No. 61. And since Bill No. 62 is a later enactment and states the purpose in the very act which imposes the taxes, it must prevail over Bill No. 61 which was enacted at an earlier date and which was more general in its nature. Goff v. Gates et al., Commrs., 87 Ohio St. 142, 100 N.E. 329; State, ex rel. Crabbe, Atty. Genl., v. City of Cleveland, 115 Ohio St. 484, 154 N.E. 738.
To give effect to the provisions of Sections 1 and 2 of Bill No. 61 regarding the distribution of the taxes contrary to the express statement of the purpose of the taxes in Bill No. 62, would violate Section 5 of Article XII of the Constitution of Ohio, which states that:
"No tax shall be levied, except in pursuance of law; and every law imposing a tax shall state, distinctly, the object of the same, to which only, it shall be applied."
It is therefore the conclusion of this court that Amended Senate Bill No. 61 is repealed. The judgment of the Court of Appeals will therefore be affirmed.
Judgment affirmed.
WEYGANDT, C.J., JONES, MATTHIAS, BEVIS and ZIMMERMAN, JJ., concur.
STEPHENSON, J., concurs in propositions 1 and 2 of the syllabus and in the judgment, but dissents from proposition 3 of the syllabus.
I concur in the judgment herein and in paragraphs one and two of the syllabus. I dissent as to paragraph three of the syllabus on the ground that the following clause "and every law imposing a tax, shall state, distinctly, the object of the same, to which only, it shall be applied" of Section 5 of Article XII, Constitution of Ohio, has no application to excise taxes.