Opinion
July 3, 1928.
1. TAXATION: Insurance Company: Deductions. A domestic insurance company is taxable on its cash and uncollected premiums outside of this State, and on its real estate within or without the State, but is not taxable on its net reserve; and if such cash and uncollected premiums are included in its assets, and after the real estate and the reserve and other liabilities are deducted from the gross assets, its remaining assets are nothing at all, it is taxable only on its real estate.
2. ____: ____: Tax Return: Evidence of Omitted Assets. The statute gives to a board of equalization power to compel the production of books and papers of a domestic corporation and to compel the attendance of witnesses, and to assess property of the corporation omitted from the assessor's book, and when suit is brought to quash its record assessing the company's property for taxation, the board is entitled to show that the corporation had taxable assets in addition to those listed in its tax return; but if the board makes no such showing, the return will, upon certiorari, be taken as true, and if it shows no assets legally taxable, the assessment will be quashed.
Corpus Juris-Cyc. References: Taxation, 37 Cyc., p. 805, n. 72; p. 1089, n. 52.
RECORD QUASHED.
Bryan, Williams Cave for relator.
(1) Sec. 6386. R.S. 1919, prescribes the method for the return and assessment and taxation of domestic insurance companies, and the method provided therein is exclusive of all other methods. State ex rel. Am. Central Ins. Co. v. Gehner 280 S.W. 416; State ex rel. Am. Automobile Ins. Co. v. Schramm, 271 Mo. 223. (2) Under the provisions of Section 6386 every domestic insurance company must return and be assessed, first, on the real estate held or controlled by it; second, on the net value of all its other assets or values in excess of the legally required reserve necessary to reinsure its outstanding risks and of any unpaid policy claims, which net value shall be assessed and taxed as the property of individuals. (3) This statute prescribes a system of taxation of net assets, and requires such net assets to be assessed and taxed as the property of individuals. State ex rel. Am. Central Ins. Co. v. Gehner, 280 S.W. 416; State ex rel. Am. Automobile Ins. Co. v. Schramm, 271 Mo. 223. (4) The order and finding of the Board of Equalization entirely disregarded the decisions of this court and, instead of assessing the relator in the manner provided in Section 6386, has undertaken, without any authority of law, to assess relator on its gross assets. In so doing, the board disregarded, not only the plain provisions of the statute and the clear and positive decisions of this court, but the board also entirely disregarded the well-known principle of law that, in order that property may be taxed, it must, by law, be subjected to taxation. State ex rel. Am. Central Ins. Co. v. Gehner, 280 S.W. 416; State ex rel. Am. Automobile Ins. Co. v. Schramm, 271 Mo. 223; Valle v. Zeigler, 84 Mo. 214; Kansas City v. Building Loan Assn., 145 Mo. 50; Leavell v. Blades, 237 Mo. 700; State ex rel. v. Lesser, 237 Mo. 318; State ex rel. v. Schryack, 179 Mo. 424; Cooley on Taxation (4 Ed.) sec. 939.
Julius T. Muench and Charles J. Dolan for respondents.
(1) Sec. 12775. R.S. 1919, imposes a tax on the property of relators. This section is self-explanatory. See Life Assn. of America v. Board of Assessors, 49 Mo. 512; St. Louis Mutual Life Ins. Co. v. Board of Assessors, 56 Mo. 503; State v. Ry. Co., 77 Mo. 213; State ex rel. v. Shipman, 290 Mo. 65, regarding the general policy of the law in Missouri. (2) The assessments levied on relators by respondents are made mandatory by the provisions of Secs. 12775 and 12766, R.S. 1919. Secs. 12752, 12766, 12775, 12802, R.S. 1919; Life Assn. of America v. Bd. of Assessors, 49 Mo. 512; St. Louis Ins. Co. v. Bd. of Assessors, 56 Mo. 503; Judson on Taxation in Missouri, p. 52. (3) The revenue law of the State is complete in itself, providing regular methods for the assessment of all property in accordance with the provisions of Section 12752. Sections 6386 and 6397, invoked and relied upon by relators, are not part of the revenue law and were never intended to control the operation of any provision of the revenue law. On the contrary, the General Assembly has expressly provided that their operation shall be "subject to the provisions of said laws" (i.e. the revenue laws). (4) Section 6386 was enacted in 1879. Its purpose was to provide a tax on "net assets" of domestic insurance companies to supplement the tax imposed under authority of the general revenue laws. To construe it as being in lien of the tax provided for in the general revenue laws would be to ignore the plain intent of the Legislature. The primary rule of statutory construction is to ascertain and give effect to the intent of the legislative body. "To find out the intent is the object of all interpretation." Lewis' Sutherland Statutory Construction (2 Ed.) 696, sec. 364.
The relator brings this proceeding to quash the record of the Board of Equalization of the City of St. Louis assessing its property for taxation.
The amended return for taxes of June 1, 1925, shows total assets of all descriptions amounting to $1,185,439.44.
Of this, $451,120 consists of real estate in Missouri, and $3200 in real estate outside of Missouri, on which taxes were paid. Other deductions, including $386,919.43 reserve, show that the remaining taxable assets of the relator are $296,914.01 less than nothing. Notwithstanding that return the Board of Equalization fixed its assessment at $75,000.
Among the deductions is $1000 in each outside of Missouri and premiums uncollected outside of Missouri $220,919.43, which are properly taxable in this State, as decided in State ex rel. American Automobile Insurance Company v. Gehner, 320 Mo. 702. This would not make enough to balance the deficit. The return, therefore, does not show on its face that relator had taxable assets, besides real estate, equal to the amount assessed to it. The statute gives the County Board of Equalization power to compel the production of books and papers, and to compel the attendance of witnesses. It may assess property omitted from the assessor's book. It therefore has power to show if relator had taxable assets in addition to those listed in the return. It made no such showing. Therefore the assessment is quashed. All concur, except Walker, C.J., and Blair, J., absent.