Mercantile Bank v. New York

Citations

• 121 U.S. 138
• 7 S. Ct. 826
• 30 L. Ed. 895
• 1887 U.S. LEXIS 2030

Syllabus

<p>The main purpose of Congress in fixing limits to state taxation on investments in shares of national banks was, to render it impossible for the state, in levying such a tax, to create and foster an unequal and unfriendly competition, by favoring institutions -or individuals carrying on a similar business, and operations and investments of like character.</p> <p>The term “moneyed capital/’ as used in Rev. Stat. § 5219, respecting state taxation of shares in national banks, embraces capital employed in national banks, and capital employed by individuals when the object -of their business is the making of profit by the use of their moneyed capital as money — as in banking as that business is defined in the opinion of the court; but it does not include moneyed capital in the hands of a corporation, even if its business be such as to make its shares moneyed capital when in the hands of individuals, or if it invests its capital in securities payable in money.</p> <p>The mode of taxation adopted by the State of New York in reference to its ■ corporations, excluding trust companies and savings banks, does not operate in such a way as to make the tax assessed upon shares of national banks at a greater rate than that imposed upon other moneyed ' capital in the hands, of individual citizens.</p> <p>Although trust companies, created under the laws of New Ybrk are not banks in the commercial sense of the word, shares in such companies are moneyed capital in the hands of individuals: but as these companies are taxed upon the value of their capital stock, with deductions on account of property in which it is invested either otherwise taxed or not taxable, and -are additionally taxed upon their income by way of franchise tax, it does not appear that the rate of taxation thus imposed. by the laws of New York is less than that upon shares, in national banks.'</p> <p>Deposits in savings banks are exempted from state taxation fo.r just rea-'. sons, and, as the exemption does not ope