Don Allen Chevrolet Co. v. Pittsburgh

Dissenting Opinion by

Mr. Justice Cohen :

Appellee in its brief argues that: “The emphasis of appellants’ argument is on the premise that the Don Allen Chevrolet Company, having taken on its legal existence as of December 30, 1958, is a new ‘person’ or taxpayer under both the Act and the Ordinance. The appellee has no dispute with this conclusion. However, appellee does dispute that it logically follows that the appellee, after purchasing all of the assets of the Edson Investment Company on December 31, 1958, must necessarily therefore, have ‘commenced’ a business within the meaning of Section 5(b) of the legislation in question.”

This is a distortion of the legislation, which distortion unfortunately has been adopted by the majority. The Act of June 20, 1947, P. L. 745, §5, 24 P.S. §582.5 (b)¹ does not require annualization by a taxpayer who has commenced a business. The legislation imposes a tax on a taxpayer who has commenced its business. It does not require us to determine whether the business being conducted by a new taxpayer is or is not a continuation of an old business — it does, however, require us to determine whether the new taxpayer commenced its business within the year, and the facts clearly indicate that it did.

Since the majority and the appellee have no dispute with the conclusion that the taxpayer, Don Allen Chevrolet Company, began its legal existence as of December 30, 1958, and is a new taxpayer, it is informative to observe what tax consequences flow therefrom. A new taxpayer is required to file a Federal income tax return separate and distinct from its predecessor; file a Pennsylvania corporate net income tax return separate and distinct from its predecessor; file a Pennsylvania capital stock tax return separate and distinct from its predecessor; obtain an employment number separate and distinct from its predecessor; apply for a new contribution rate for unemployment compensation in accordance with the statutory provisions of the Unemployment Compensation Act; file for and obtain all new city, state and county licenses when, as and if required. In fact, all tax and regulatory contacts with government of the newly-formed Don Allen Chevrolet Company are evaluated without any reference to the prior business which the newly-formed company acquired.

It would seem that since the other agencies of government impose their taxes and their regulations on a new taxpayer without reference to the prior operation, we should not misread the city and school district acts so as to establish a contrary procedure.

Mr. Justice Jones joins in this dissenting opinion.

1 “(b) Every person, subject to tbe payment of the tax hereby imposed, who has commenced his business less than one (1) full year prior to the license year ... or who has commenced his business subsequent to the beginning of any license year for such license year and the succeeding license year, shall compute his annual gross volume of business upon the actual gross amount of business transacted by him during the first month of his engaging in such business, multiplied by the number of months of the current license year remaining, or multiplied by twelve (12) for the first full license year he engages in business, as the case may be.” (Emphasis supplied).