269 U.S. 269

46 S.Ct. 110

70 L.Ed. 270


No. 246.

Argued Nov. 24, 1925.

Decided Dec. 7, 1925.

Messrs. Warren Gregory, of San Francisco, Cal., E. S. McCord, of Seattle, Wash., and R. E. Robertson, of Juneau, Alaska, for petitioner.


[Argument of Counsel from pages 269-273 intentionally omitted]

Mr. John Rustgard, of Juneau, Alaska, for the Territory


of alaska.


[Argument of Counsel from pages 273-275 intentionally omitted]


Mr. Justice HOLMES delivered the opinion of the Court.


This is a suit by the Territory of Alaska to recover from the petitioner, Pacific American Fisheries, license taxes alleged to be due upon cases of salmon packed by the defendant at four canneries named. The defendant in its answer set up that the territorial taxing act was contrary to the Act of Congress of August 24, 1912, c. 387, § 3, 37 Stat. 512 (Comp. St. § 3530), creating a legislative assembly in the Territory of Alaska, and to the Constitution of the United States. The Territory demurred; there was a judgment for the plaintiff and this was affirmed by the Circuit Court of Appeals. 2 F.(2d) 9. A writ of certiorari was granted by this Court. 267 U. S. 589, 45 S. Ct. 353, 69 L. Ed. 801.


The taxes in question were imposed by chapter 101, § 1, Laws of Alaska, 1923, amending chapter 31, § 1, subsec. 2, subd. 8, of the Laws of 1921. By (c) of that subdivision salmon canneries, after a tax by (b) of ten cents per case, are charged an additional tax on a pack of kings, reds, and sockeyes, counted together, at any one cannery, as follows: On all cases in excess of ten thousand and not more than twenty-five thousand, five cents per case; in excess of twenty-five thousand and not more than forty thousand, ten cents per case; in excess of forty thousand and not more than fifty thousand, fifteen cents per case; and on all in excess of fifty thousand, twenty cents per case. Similarly in (d) and (e) a tax of four and one-half cents per case is imposed on medium reds, cohoes, and pinks; with additional taxes for each increase of numbers as in the previous subdivision. By (f) chums are taxed three cents per case. The petitioner says that this graduated tax is inconsistent with the Act of Congress mentioned, which provides that the authority therein granted to alter, amend, modify and repeal laws in force in Alaska should not extend to the game, fish, and fur seal laws, and presses this contention notwithstanding the further proviso that this provision shall not operate to prevent the legislature from imposing other and additional taxes or licenses. The petitioner also says that the classification upon which the surtax is based is unreasonable and a denial of due process of law, contrary to the Fifth Amendment of the Constitution of the United States. No question is raised about the uniform tax of ten cents per case imposed by (b). That has been paid.


The petitioner offers various reasons to show that this tax is not what it purports to be but is an attempt to regulate fisheries, which, the petitioner believes, Congress has not given the Territory power to regulate. The answer alleges that it was known that the revenue from these taxes would exceed the appropriations and needs of the Territory, and from this and other things the conclusion is drawn that the taxes were levied with the intent of driving the defendant out of its business. But the premise could not be known, it only could be prophesied. If known the conclusion as to legislative intent would not follow; and if the intent were entertained, in the only sense in which it rationally could be imputed, that is, to discourage canning the larger amounts, the legislature lawfully might act with that intent. Fisheries were not the direct object of attack, but canneries. It would require a strong case in any event to invalidate a tax on things that the legislature had power to regulate because of its collateral reaction on something else. But here even as to fisheries the legislature is given power to tax. Any tax is a discouragement and therefore a regulation so far as it goes, and the most plausible reconciliation of this power with the restrictions upon amending or modifying the laws in force in that the only purpose of the restrictions was to prevent the Territory from doing away with all protection, in a shortsighted rush for fish. At least we must take it to be clear that the unlimited power expressly given may be exercised with consideration of collateral advantages and disadvantages. Alaska Fish Salting & By-Products Co. v. Smith, 255 U. S. 44, 48, 41 S. Ct. 219, 65 L. Ed. 489. It could not be exercised intelligently otherwise. The extent of the power is a question of specific interpretation not of general principle; and therefore we leave the many familiar cases that were cited, on one side.


It is not unworthy of notice that in section 9 of the Act of August 24, 1912 (Comp. St. § 3536), an earlier statute of July 30, 1886, c. 818, § 1, 24 Stat. 170 (Comp. St. § 3479), is taken up, in which the power of the territorial legislatures to pass laws for the protection of game and fish is recognized, and also that the latest revision of the fish law by Congress was passed after the present tax law had been enacted and had been upheld by the District Court; that it provided that nothing therein contained should curtail the powers of the Territorial Legislature of Alaska, and that it showed no sign of dissatisfaction with the way in which those powers had been used. Act of June 6, 1924, c. 272, § 8, 43 Stat. 464, 467 (Comp. St. Supp. 1925, § 3622 1/4 e).


It is much pressed that the tax discriminates against large canneries in favor of small ones-this especially as contravening the Fifth Amendment and denying due process of law. Classification of taxes by the amount of the corpus taxed has been sustained in various connections heretofore. By way of specific answer it is pointed out by the Attorney General of Alaska that the size of the run of salmon cannot be foreseen; that a cannery must be prepared to its full capacity; that there always will be an irreducible minimum of expense to be borne whatever the size of the pack; that therefore a small pack may mean a loss and a larger one a profit, and that on these considerations the law justly may attempt to proportion the tax to the probable gains. The inequalities of the tax are based upon intelligible grounds of policy and cannot be said to deny the petitioner its constitutional rights.


Judgment affirmed.

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