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statuteappealdiscrimination
statuteappealcorporationappellantlevy

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Klein v. Jefferson County Board of Tax Sup’rs, 230 Ky. 182, 18 S.W.2d 1009

Facts

In 1925, Junius C. Klein owned a significant amount of stock in the Standard Sanitary Manufacturing Company, which was assessed at $95 per share by the county assessor. Klein and other stockholders sought relief from this assessment, claiming it was excessive and unconstitutional. The board of tax supervisors and the Jefferson quarterly court upheld the assessment, leading Klein to appeal to the circuit court, which also affirmed the assessment.

1 Junius Klein in the year 1925 owned a large block of stock in the Standard Sanitary Manufacturing Company. The assessor, in making the assessment for that year, valued the stock at $95 a share. Klein, and other taxpayers similarly situated, applied to the board of tax supervisors of Jefferson county for relief from the assessment. The board refused to modify it. They then appealed to the Jefferson quarterly court. The quarterly court heard the case, and on December 4, 1925, entered a judgment sustaining the action of the assessor and of the board of supervisors. Klein appealed to the Jefferson circuit court.

Issue

Whether the assessment of Klein's stock at $95 per share was unconstitutional and whether it violated the equal protection clause of the Fourteenth Amendment.

Klein contends: (1) The stockholders cannot be taxed under the Constitution of Kentucky. (2) The assessment at $95 a share is not warranted. (3) The assessment is a denial to him of the equal protection of the law, under the Fourteenth Amendment of the Constitution of the United States.

Rule

The court applied the principle that property can be classified for taxation purposes, and that the state has the authority to tax both corporate property and individual shares of stock without violating constitutional protections.

Section 171 of the Constitution provides: “Taxes shall be levied and collected for public purposes only and shall be uniform upon all property of the same class subject to taxation within the territorial limits of the authority levying the tax; and all taxes shall be levied and collected by general laws.

Analysis

The court analyzed the assessment in light of Kentucky's constitutional provisions and statutes, determining that the classification of property for taxation was reasonable. It noted that the stock was valued based on its market price, which was consistent with the requirement that property be assessed at its fair cash value. The court found no evidence of discrimination against Klein compared to other taxpayers.

The court is unable to see, therefore, that appellant is entitled to any relief under the Constitution of Kentucky.

Conclusion

The court affirmed the judgment of the lower courts, concluding that the assessment of Klein's stock was valid and did not violate his constitutional rights.

Judgment affirmed.

Who won?

The Board of Tax Supervisors prevailed in the case as the court upheld the assessment of Klein's stock, finding it to be in accordance with state law and constitutional provisions.

The court is unable to see that it has any application. That case seems to rest upon the idea that long-time mortgages are made by corporations and short-time mortgages are made by the poor, whose credit is not good, and that the statute taxed the corporations and exempted from taxation individuals.

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