C. Francis Fisher, James R. Fitzgerald, Brenlove & Fisher, Pittsburgh, for appellant.
Robert Engel, Asst. City Sol., Anne X. Alpern, City Sol., Pittsburgh, for appellee.
Before Rhodes, P. J., and Hirt, Reno, Ross, Gunther and Wright, JJ.
[ 174 Pa. Super. Page 76]
This is an appeal by Gunn Pontiac, Inc., a Pennsylvania corporation, from an order dismissing its appeal from an assessment for mercantile taxes imposed by the City of Pittsburgh on its gross volume of sales of motor vehicles under installment sales contracts for the year 1951.
The Act of June 25, 1947, P.L. 1145, 53 P.S. § 2015.1, gave authority to cities of the second class A and certain other political subdivisions to levy such taxes on persons, transactions, occupations, privileges, subjects and personal property within their limits as they should determine, but not on a privilege, transaction, subject, occupation or personal property 'which is now or does hereafter become subject to a State tax or license fee * * *.' The constitutionality of this Act was upheld in English v. Robinson Township School District, 358 Pa. 45, 55 A.2d 803. In pursuance of this authority the City of Pittsburgh, on December 1, 1947, enacted an ordinance imposing annual mercantile license taxes upon persons engaged in certain occupations and businesses at the rate of one mill on each dollar of the volume of the annual gross business transacted by wholesale vendors and dealers and two mills in the case of retail vendors and dealers. The validity of this ordinance was sustained in Federal Drug Co. v. City of Pittsburgh, 358 Pa. 454, 57 A.2d 849.
Gunn Pontiac was engaged in the business of selling new and used motor vehicles. It paid under protest a mercantile tax on its gross volume of sales of
[ 174 Pa. Super. Page 77]
motor vehicles under installment sales contracts. It is its contention that it was not liable for payment of this tax because it is required, under the Motor Vehicle Sales Finance Act, Act of June 28, 1947, P.L. 1110, 69 P.S. § 601, to pay a 'license' fee to the Commonwealth for the privilege of conducting its business as an installment seller of motor vehicles.
The question before us is whether the 'license fee' which appellant is required to pay under the Motor Vehicle Sales Finance Act exempts that portion of its volume of business obtained by sales of motor vehicles under installment sales contracts from the Pittsburgh mercantile tax by reason of the exclusion provision of the enabling act under which the city passed its ordinance. We are agreed that the question must be answered in the negative.
'A license fee is a charge which is imposed by the sovereign, in the exercise of its police power, upon a person within its jurisdiction for the privilege of performing certain acts and which has for its purpose the defraying of the expense of the regulation of such acts for the benefit of the general public * * *.' Pennsylvania Liquor Control Board v. Publicker Commercial Alcohol Co., 347 Pa. 555, 560, 32 A.2d 914, 917; Pittsburgh Milk Co. v. City of Pittsburgh, 360 Pa. 360, 365, 62 A.2d 49; Armour and Co. v. City of Pittsburgh, 363 Pa. 109, 113, 69 A.2d 405. The Pittsburgh Milk Co. and Armour cases, when read together, add substance to the bare definition of a license fee.
In the Pittsburgh Milk Co. case a bill in equity was filed to restrain the City of Pittsburgh from collecting a mercantile tax and license fee. The plaintiff was engaged in the business of purchasing raw milk from dairy farmers and transmitting the same in bulk to its place of business in ...