  ‘, ~‘i~&ablr
,,_,                   Ri t,   Oroslor,   page   11

                     ,, ‘,
                  mefini of tax*    the wrooiml propeity   of ttite
             ;    banking odrporatlono in the hands of the, ehar
                  holdora.   It follows from thlr that suoh car-
                  poratlona are mt now roquirod~to rendor thelt,
                  permonal progorty ror taxation;,  . . .*                ,
 ,’
                 Tho &me oozietruotlon of the Toxar rtatuts’r iavb~ved          ‘.
     vai srrnounood by thp Court of Civil‘ f@.r,petiB Of %‘oxncrin the y ; ;, :
     ome 0r First ITatlonnl Bank 0r Impaaos vr: City or.uimpaa~
    .78 8, w. 42, writ or erroti dlemiossd by the S&rem Coui+t., ,ih&      * “,
   .-oouPtrtatod    an r0im8t

      .                “It  iti settled by doolrrfonrr of the Sup-
                  roni, Cow:   of the United Statea that it linot
      .,,      ”uithln the $ovor Of a etate to eubjeat tW pro-
                 party of natlonal banka to taxation vithout,
                                                                                              ”
                                                                                                  I.



              : the Comont or the federal Con.gwar            The only
         ‘,      provlaion or the redoral etatutoe vhioh author-
                 lcer such taxetion la eeotion 5219 o tho Re-
                 vlsed Statutec of the United St&tee f U.S. Camp.
                 St. 1901, p, 3502), and that permitd ruah.tcua-
                 tion w agalnat buch benka, ‘upon riml eetate
                 Onlg. It authoyizes atato taxation or the
    *~           atoek  of suoh banke aa a@net         the wnom of
                 such #took, btit not a$ agalnat the bar&m. In
                 harmony Vith that rtstuto,       the Le&islaturo of
  .,’            thi8 state has we        full provlrrlon for the aa-         ,.
               awm?nt       and colleotlon     of taxea,upon national
.          “’ b&k stock from the ovnern of uuah rt.oQk, and
                                                                                   .


                 has made no attempt to oom901 national banks to
                 priy taxes on euah 9roportgr ‘~Sayleo* Rev. Cl?.
                 St. 1897, arts.     5079, 5079a, and 5080,      Henoe
                 ne’ are of opinion that the bank vae under no                         I,



          ,;:~ legal obligation       to render’and 9&y taxer on the
                 proporty’ln    question.     Thoee visve are rrupport-
                 cd by ntithmity. * Miller V. First Ration81
                .Bmk, 46,0hio St. 424, 21’R.E.         8601 Blrat lot;
                 Bank Y, Ffshor, 45 fan. 726, ,26 Pao. 482.’

                       It la our opinionthat    under th6 lava of this State
                                       to a matlonal bank:,ir texablo cq&nat                ,.
                                  raonal ,prapertg bslonging~ to ouch a .Nat-                 t
          loaal    bank mcy not    ‘taxed by the Stats,    %rther,   &aver of
                                                      .    .I’. a’.
                                                b .~.
                                                                      .

                                                                           .‘,


i&k   in ‘a dat$onal bank may be taxed in the hand8 of the      ’
rharoholder 8.   This ha8 been the lav or thir .Stato rinoo the
ourly Texae Suprome Court oat30 0r Uarrlsoa   Y+’Yinor, 46 Vex,
15,~mhs aowt rtatod       au   3ollovar
                “It fr a& well nettled by the Supreme
     ‘, court or the United Stattoe, by whose constru0~                          ,,


  ,~’‘. tloa an aot of Congree8 thie oourt Is uri@aor-                                “,
         tionably bound,. that the rrhaiw of bankin5 a81
         roolatlons   authorized by the abt of June 3,
 ‘Y’,1864,‘To provide a “national ourronc ” &or
   ; ” In the hand8 of the ahareholdorr are I’iable $6
         ta?ustIon by, tho Statoa with the lltitatlon8
   ; c and on the oondltlono      sot forth in tho forty-.‘,
      .’ ‘first soctloa of said sot, although the entlr@
         a&pital of euah bank I8 Invested in national          1
         roourltloo,   whloh are dealwed by theetatuto
  .. (authoriaing      thorn to be %xcmg
   *     by ‘or ‘under 5tatoWg;horlty.
        The Ae8088or8,           ., 5
         Comafo8loaor8, t Wall.., 2 1;: Natloaal Bmk v.,
         Uoxmtoavoalth, O~Wall.,    353.j , . .,.I     -
             The next question that arl~sa fa whether 02 not tho
  mh&rer of- rtook ,la a National bank vhIah are taxed In the name8
  of the rhareholdore should bo aeaevsed at a valuetioh     iu me-
  duoodb+aueo or tho ,faot that. the NationalBank own8 Federal
, Rerervo rtook.   Tho rule or lav In euoh a 0088 88 to United
  Water bonde owned by a Natloncrl bank vaa stated by ,th8 C,owt .               .’:
  or oltii A9 oala 0r TQXW in the dam 0r Adair V* Robinson,                  .1
  25 ‘8.:
        If..734. The question before the oourtla thatQM@ YOI              ,./
  rt@tad therola 80 rollowe:

                       The ‘faoto are sot oontrovertod
    “and li       &iy quo&ion presented for ow de&  de&
         #ion 18 the right of the ovnara of the rtock
         or the. bank to ronder the. awio for taxation at
    : ‘.‘ftr aotual Y~~UO, lone the amount of the United
         &ate8 bond8 Andythe legal tender not08 owned,
    .’ b thr ba@c oa the I8t day ?r.+naary~Aa ‘De ._
     .1591:. ...*y                        .
        .      I ,"                  :
                   <, '.                 .*
        *.
                  ',
                  ,,~                                                               .




              5
                          .~‘.,.,   .,.        “”    -“~.                                                  ‘*‘~:j’f’.
    I

                                          ‘,

                                                                            .   ’

                                                ‘.




                                                                                                       (        ..
             ’
                        ' The oourt'hald             OII follwel

                            I.4 .        !l%crcs is ho decision of that oourt
                   known to u; whloh tenda to sustain                the content&on
                   of eefondcnt         II ln ,errorj but, on the contrary, la.
                   filie oaffo of Vm Nlon v.~Aoa~~~~r,               3 lidll. 573;.           ,
                :’,it~,ia eqmmily             dooided by a majority of the
                .. supreme cowt of. the, United Etatou, after thor-                    ‘,                                             ii.

                  ‘ough tuul e~hauotive ~dleouoeion of the question;                       :.
         ,,,
                   that it was not tho r&at of the ehareholdare                           .~. ’
                 ‘.of .a national bank to hem deducted from the ~’
               “‘-value of their sham@ of atook, when rendered
                   to the state offioor             for taxation,    the drumof
                   tione;r invested by the bank in United Etatgs                    ‘.
:                  bonda.        Nor 18 there anything in the deoieionr.
                   of.  the    tu~rome,      court of thla    state,  that   Yo
                   hare discovered,            which coL-stonauoee tho rule
,.’                for easeermont            of chaws    cf bauk stook vhlch
             ,~’ ,,the defendants in error              contend for, . .~ ,”

                     In the case of Fimt E!%sional Zank of'C5.m.ioinui~t1,                                                  :
          Chio, 0. Qutir, 246 FM. 163, the shareholders in a Rational
          bank’oontendsd that the value of the sharer of stock in said
        : bank must be reduced for etate ad valorem tax purpoaor beoawe’
          the bank'r ovqorohip of lahtcrcs of rtock 4~ a Fedorsl Remrvo
          b&k.    The oontontlon of the bank’s Wwoholderr’in     that 08SO
          ~wu”88 t0110vr 8

                       *The plal&iff   oltiims that the provision8                           ‘:
             . .of’riotion   5219, R.8,U.S.   (Aot June 3, 1864,                                                                        #
                 d. 106 ( 41, 13 Stat, 111, aa amended Febrmarg                               .:                                  ,
              ,.lO, 1868 (15 Stat. 34, c. 7)),     are so far ro-                                                               .’
                  ealed by oectlon 26 of the Federal Resorve AoC                             :     :                                    i,
             ‘~ PAct, Dee. 23 15113, 0. ..6, 30 Stat. 25 (Omp. St.
                 1916,’ 1 gSo3j~), that the sharoholdora in the
                 plaintiff  be& aro oxenpt fron taxation by via’-
                 tuo of rootion 7 of the last-nmod     eat (Corsp,
              ,, St i 1916 ! 979%) on ao much of ito capital       :                         ,.
                 8na‘rurpiur a8 ia, invoated ir, rtook of the
               peder0.l ReseHs Bank. '4 telqlorary ul$lnotion~,
              : irruod tmeA'the bill    Vai filed.         "
                          II..**,                                                       ,.                              w

                  :.



                                                                   , , .'
                                                            :~
   Honorabl* i.         L.   Croaler,   page.14
 ;:
,’
                   ‘1. . i P6r the subscription. thus made.”
            thd national bank booomor a 8-c fholderoc rtook-
            holder In the Fedomil Reserve Dw,       but may not.
          , +nsfer      OP hypotheoato lte ahWeaj each   of tiLti
            $a.of’the    face value of $100.   SubaeOtion 3 of               .
         ,‘,‘, ~ ,@Otion’7   prorldeothatJ
                  . wVcdoral Roa’erve  D&&a, inolud%     the
           : capital atook and atipluo therein,     and the in-
             o&a dwivcd thorofrom, ah&l1 bo exmpt from
             ~eeberal, state,   end looal taxation,  oxoopt tex-
/            es ,upon red   estate, 1”

            ’ Ia tho above quoted portions of the First     liatlonal            :,
    Dank Y, Sh.wr oaao it may be soon. that Thor ehmeboldora in the
    Rational Dwk.vere oonteridlng that the provlnlon.ln     the Fed-
    eral Resews Act, vhioh providoa that tho Fodoml ReaOrvo;
: .banklaoludhg       tho oAplt+l stock   and tho aurplw thereinand
   ,lncome dorived tharof’rom voro exempt from Stat0 taxation rO-
    qkihwd tho State tw&q     authorities   to rcduoe t&o value of thr
   .aIqarea of atock.in  the plalntlff~a   National Bank boo&use ,aa%d
  ~benk’ovncd eharoa of etook in a Federal Reserve Dank. l’he
    oourt @nevered the aontention and stated ae follova~              .
          ,. ’
                    .“The CJX~llQtfOAppoildod in .?ootiOa 7 dOOS
             ‘not extend to national banks orgnnieed undo?
              the,lVational DanUng’Lan,’     I&ad Coagmsa Ant&d-    ‘.
              od that their capital    otoolr..ehould be relieved
              from taxation,   it would have oaid 80~
                 ,.  *T& stock pkohaeed by the plaintiff      ia.        .
              ‘the ‘Pedoral Roaervi3 Da& irr but & nontaxable
               inveatmont of a psrt of its oapltal and aur-
              plus.    As acrid’5n Firlit Hat. Bank vw &bright,
              208 u. 8.    48, 553, 20 5up. Qt. 349, 350 (52                 ’
            ,,‘L. zd. 614 J ..

    .I      ,.    n~The’lav does not oonaidez. the xkatuw Of
             ,a b&k18  investment not texed in f$xing tho
            ~~
             ooluo of    ts atook.    Palnor V. Mal&ho~, 1%
             u.S; 669, t lo sug. Ct. 324, 33 Ii. Ed. 772). ’ ,..
                                   ::
                        ‘%hatever value the ohares lsaucd by the
         :., ,’ppbfatlff      .natiorml benk po~oem, they are :to
            ., that extont tax&bU in the hand8 of their own-
             ,.. em .a.nd holdera.      Rosonblatt v. Johnrton, 104 Ur.
           I’ 8. 462, 26 L. Ed. 832~ my,               oto.,     of San Fran-
                 oirob, Y. Croaker-Xoolworth Nnt. Bank (0.0,)
            .*92 Fed, 273. The oourte have repeatedly ruled’
     ” ‘, .that., IA Sixbig. ‘the value of the shnros OS
                 stock of natlonal bank8 for .tfWng purpof~o8,                  ”
    ;,
                 the value due ,t3 the bank’s olmershlp or non-‘,
                 taxable United Btates~bonda as a part of ltr
         ..“‘. aaaets must be lnoludod.            se,       for inntanoe,
                 Cleveland Trurt Co. v. L!indcr, 184 0.9.. 111,
'             ‘22 8up. Ct. 394         46 L. Ed, 4%~ Xa or o.~Anwi~'             ~"?:
                 oan Nat. Bank, i5g Pod. 396,401,86 C.C.A.3?b;c                ;,,,:: _
                 (C.0.A.   6)~   Van  Allen,v.    Aeaeseorr,      3 Well.     e”
                   73, 18 L. Ed, 229 Peoplo ve Comlsrionera,                  ~..’ ”  *.
                 2 Well. at pago 25 6, 18 Lt. Ed. 3441Nat,Bank
                 Y.  Comonvealth,      g Wall* at p&8&e359, 19 II.Et&
               .,7Olj Born0 Cavings Bank Ye De* Moines, 205 lJ.8,
           ’ .at pwoe 528, 513, 27 Bupr. Otr 571, 51 Lr Ed..
       .,’ ,901. .Tho ~amo rulo~ appllea to nontaxable stook
                 e      ;y tho plaintiff       in tho Fsafwai Roaorvo
                      .

             The cotit denled the oodtentioa of tho ~rhareholdorr
  ls tWXiation&l   bon4 and held that the mm       rulip   applied aa $0
 .rtook ovned bu the,Natlonal    bank in a Federal Roeerve bank
‘&a har beon p:oviouely     announoed CtQpma    vhere the NatlOn8l
  bank ouaed United .Stator   bond8 ~8     p8rt pi it8   &88et8r

              ihe Ceoult  Court or Appeale’ affirmed                  the   de0bi081:
    of the ‘Matriot Court aud utsted ~a Sollow;

                “Ne are aatiafled,   not only with tho oor-                             1~
          reotners OS this oonoluaion; but with the peak           ,,’
          aonlng of the opinion on vhloh the conoluaio~
          18 baaed, and 8ro oontont to affirm the juds-       .~‘, .,
          ment upon that opinion;     Uo think its oloar that       ..
          Oongreso ihtendcd to place a r.mtlonal bank@8
          holdingr OS Federal Reeerve Bank rtock ugoa pl+              ‘.
          oieel    the, uame beair ar its’holdingr  OS govern-
          meat. Iionde, eo r8p ae exemption *iron taxation
    .          :

                                                                                       44

        ~o&rabloit:L. Cro&r,               pwe 16 ._
                                                  *
         ,."
              of iharesof natlonel bank #took              heldby
           “‘,atookholdera therein*”

                   You are therefore’ advised that in the opinion of
        thla deiartment, the valueof ahyea OS atookownedby atook-
        holdera in a National bank may not be reduood beoauao of the
I       fiwt~thot  the Nationd   bank own8 aha??oa of atook in a Pxloral
        Reaewo bank.
                       We trust     that   the f6regoing   fulli   tfnayerr youc la-
        ‘q&y       O?I$hla ptter,              .
                                                           Your8verytruly
