JOSEPH E. MATTHEWS, Petitioner, v. STATE OF NEVADA ex rel. NEVADA TAX COMMISSION, Respondent
Matthews v. State ex rel. Nevada Tax Commission
JOSEPH E. MATTHEWS, Petitioner, v. STATE OF NEVADA ex rel. NEVADA TAX COMMISSION, Respondent.
JOSEPH E. MATTHEWS, Petitioner, v. STATE OF NEVADA ex rel. NEVADA TAX COMMISSION, Respondent.
No. 5358
June 6, 1967
428 P.2d 371
Springer and. Newton, and Robert A. Grayson, of Reno, for Petitioner.
Russell W. McDonald and Frank W. Daykin, of Carson City, for Respondent.
OPINION
By the Court,
Thompson, C. J.:
The Nevada Constitution provides that a proposal which has become law by referendum of the voters shall not be amended except by the direct vote of the people. The purpose of this proceeding in prohibition is to determine whether the Local School Support Tax Law, enacted by the legislature in 1967, violates the constitutional proscription against amending a referred law, since its effect is to increase the rate of the Sales and Use Tax authorized by referendum of the voters in 1956. For the reasons hereafter expressed we hold that the 1967 Local School Tax Support Law does not offend that constitutional proscription, and is therefore, a constitutionally permissible taxing statute.
It is not useful to reproduce the two taxing laws. They are almost identical in language. Both bear upon the same objects of taxation; that is to say, each imposes a sales tax upon the sale of tangible personal property, and a use tax upon the storage and use of tangible personal property. The rate of tax approved by the voters in 1956 is 2 percent, while the rate specified in the 1967 School Tax is 1 percent. The method of collecting the tax is the same. It is evident that the necessary effect of the School Tax is to increase the rate of the Sales and Use Tax from 2 percent to 3 percent. However, there is a major difference between the two since their purposes do not coincide. The Sales and Use Tax Act of 1956 was approved to provide revenue for the State of Nevada, and that tax is paid into the general fund. The School Tax was enacted to provide support for the public schools and the funds are earmarked for that purpose. Within this framework, the narrow question presented is whether the constitutional prohibition against amending a referred law (except by the direct vote of the people) precludes legislative power to enact a separate but identical tax for a different governmental purpose?
The answer must be found in an appreciation of our scheme of government and the desire to give appropriate effect to the several constitutional provisions bearing upon the problem. We are not here solely concerned with the referendum proscription. That provision is but a part of the constitutional scheme. Of necessity we must also pay deference to art. IV, § 1, vesting the power to make law in the legislature, and to art. XI, commanding the legislature to provide for public education.
From the beginning we have recognized that the legislature is vested with all governmental powers not expressly denied to it by the Constitution of the United States and the Constitution of Nevada. This principle was first declared with respect to taxation in Gibson v. Mason, 5 Nev. 283, 292 (1869), and has been reasserted from time to time. Riter v. Douglass, 32 Nev. 400, 109 P. 444 (1910); Tesoriere v. District Court, 50 Nev. 302, 258 P. 291 (1927). The power to tax is an essential attribute of sovereignty, Ex parte Robinson, 12 Nev. 263 (1877). Of course, the referendum clause, which was added to our constitution in 1904, is a limitation upon legislative power. However, it seems to us that a reasonable but narrow construction of the prohibition against amending a referred law is essential if these other important constitutional provisions are to be accommodated.
It follows that the voters approval in 1956 of a sales and use tax for the general fund cannot be a perpetual limitation upon legislative power to impose the same kind of tax solely for the support of public education. Neither may the voters expression in 1956 be deemed a directive to future legislatures that the public schools are to be supported only through some other form of taxation. Instead, the 1956 referendum must stand for what it is — an approval by the voters of a 2 percent sales and use tax for the general fund of Nevada. That law exists today in the same form and for the same purpose. Such a construction of the referendum proscription gives full effect to that provision without intimidating the legislative power to tax for public education. Though we have been unable to find a case squarely on point, our view is supported by the rationale of State v. Pelosi, 199 P.2d 125 (Ariz. 1948) and Staples v. Bishop, 286 S.W.2d 505 (Ark. 1956).
Another constitutional provision not heretofore mentioned possesses relevance to the problem at hand, and lends strong support to the conclusion we have reached. Nev. Const. art. IV, § 17 provides, inter aha, that an act or section amended be re-enacted at length. This provision has been construed in a series of cases from State v. Trolson, 21 Nev. 419 (1893) to McCormick v. Sixth Judicial District Court, 69 Nev. 214, 246 P.2d 805 (1952). The most valuable discussion is found in State v. Cole, 38 Nev. 488, 151 P. 944 (1915) where the court quoted with approval the following language in Southern Pacific Co. v. Bartine, 170 F. 725 (C.C.D. Nev. 1909): " when a new act is complete in itself, when it does not purport to be amendatory of any previous act, and requires no reference to another law to discover its scope and meaning, though the new law has the effect of modifying a former law, it is not an amendatory statute That test is met here. The School Tax Act of 1967 is complete in itself, does not purport to be amendatory of the 1956 Sales and Use Tax Act, and no reference to the latter is needed to discover the scope and meaning of the school tax. The petition for prohibition is denied and this proceeding is dismissed.
Nev. Const. art. XIX, § 1(2) reads: "If a majority of the voters voting upon the proposal submitted at such election votes approval of such statute or resolution or any part thereof, such statute or resolution or any part thereof shall stand as the law of the state and shall not be amended, annulled, repealed, set aside, suspended or in any way made inoperative except by the direct vote of the people. If a majority of such voters votes disapproval of such statute or resolution or any part thereof, such statute or resolution or any part thereof shall be void and of no effect."