PRINCIPLES OF TAXATION. 51 



returns made by the company to the above officials were correct, 

 and that the aggregate value of the items included in such re- 

 turns liable to taxation in 1895 the same as other like property 

 in the State was $42,065. The board of appraisers and assessors 

 added, however, to this amount the sum of $491,030, making the 

 aggregate of the tax liability of the express company $533,095 ; 

 and based their action not on any belief or pretense that any con- 

 siderable amount of real or personal property within the terri- 

 torial jurisdiction of the State had been discovered which had 

 hitherto escaped taxation, but that sources of reported value 

 which were entirely outside of the territory and beyond the juris- 

 diction of the State of Ohio when they constituted a part of the 

 value of the capital or franchise of a corporation located and 

 established in some other State for the purpose of carrying on 

 business, and that business " interstate commerce " entirely within 

 the control of the Federal Government might be added to the 

 intrinsic value of property within the State ; thereby assessing 

 not only property within the State of Ohio, but a proportion also 

 of all property situated without its territorial boundaries. The 

 question involved was therefore the constitutionality of extra- 

 territorial taxation ; and the case, after consideration by State 

 and United States Circuit Courts, was finally brought before the 

 United States Supreme Court. Here, notwithstanding the cita- 

 tion of numerous former opinions and judgments of the court 

 wholly adverse to the constitutionality of the principle on which 

 was based the assumption and action of the State of Ohio, the 

 court by a majority of one held to a contrary view; and gave 

 judgment in support of the State assessments on the express com- 

 pany. It is clear, therefore, that the State of Ohio has been justi- 

 fied, for the time being, in an attempt to tax something that it 

 calls property, but which is neither tangible nor visible ; that has 

 no intrinsic or essentially inherent value ; and which procedure, 

 if generally accepted and put in practice by other States, would 

 antagonize all formerly accepted theories and legal decisions in 

 respect to extra-territorial taxation, and ultimately destroy all in- 

 terstate commerce between the several States of the Federal Union. 

 AN IMPLIED BUT FUNDAMENTAL RECIPROCAL OF TAXATION. 

 Notwithstanding the absence of any warrant for assuming that 

 there was ever any real or implied contract, whereby a State in 

 its beginning or development agreed to give a certain amount of 

 protection to life and property in return for an equivalent in 

 money, goods, or services of its citizens an assumption which 

 has been characterized as the " commercial theory of taxation " * 



* u The right of a state to take the citizen's property must be put on higher ground if 

 it is to stand on perfectly safe ground. Of course, such higher ground is not to be found 



