Ewing v. City of Leavenworth
Headline: Local tax on express companies’ in‑state package business upheld, allowing Leavenworth to collect a $50 annual license fee for intrastate express operations while exempting interstate and federal shipments.
Holding: The Court upheld the municipal tax as valid because it applied only to the company’s in‑state package business and expressly excluded interstate and federal shipments, so it did not unlawfully burden interstate commerce.
- Allows cities to tax express companies’ in‑state package business when interstate shipments are excluded.
- Affirms that short crossings through another state do not convert domestic carriage into interstate commerce.
- Distinguishes taxation from state attempts to set transportation rates across state lines.
Summary
Background
An agent for the United States Express Company in Leavenworth, Kansas was charged and convicted under a city ordinance that imposed a $50 annual tax on express companies’ business of receiving and transmitting packages within the State. The ordinance expressly excluded packages handled for the United States government and any packages that were part of interstate commerce. The Express Company received and delivered packages at Leavenworth that traveled via a short branch of the Rock Island Railroad which crossed Missouri; only about one mile of carriage occurred inside Kansas, and roughly ten percent of the company’s Leavenworth business was between points in Kansas.
Reasoning
The Court considered whether the municipal tax improperly regulated or burdened interstate commerce. It relied on prior decisions holding that a State may tax receipts for the portion of transportation that occurs within the State, and distinguished cases where a State tried to set overall rates for transportation that crossed state lines. Because the ordinance taxed only the business done within Leavenworth and excluded interstate and government shipments, the Court concluded the tax did not unlawfully burden interstate commerce. The result was to affirm the conviction.
Real world impact
The ruling allows the city to collect the modest license tax on intrastate express business so long as interstate shipments and federal business remain exempt. It means short crossings over neighboring state territory do not automatically turn domestic carriage into interstate commerce for taxation purposes. The decision does not change federal control over interstate rate regulation, which the Court distinguished from this tax case. The judgment of the Kansas court was affirmed.
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