US SUPREME COURT DECISIONS

Appellant is a Pennsylvania corporation authorized to operate a railroad only within Pennsylvania and having no tracks outside of Pennsylvania. It owned freight cars which were used in ordinary transport operations in three ways: (1) by appellant on its own tracks in Pennsylvania; (2) by a New Jersey railroad on fixed routes and regular schedules over that railroad's tracks in New Jersey; and (3) by many other railroads on their own lines in various parts of the country. Pennsylvania levied an annual property tax on the total value of all freight cars owned by appellant, and appellant challenged its right to do so under the Commerce Clause and the Due Process and Equal Protection Clauses of the Fourteenth Amendment.

Held:

1. Appellant could not avoid imposition of Pennsylvania's tax on the full value of its freight cars merely by proving that some determinable fraction of them were absent from the State for part of the tax year. It must sustain the burden of proving that some determinable portion of them may be similarly taxed in another State. Pp. 370 U. S. 611-613.

2. Appellant's freight cars that had been run habitually on fixed routes and regular schedules over the lines of the New Jersey railroad in New Jersey were subject to the imposition of an apportioned ad valorem tax by the State of New Jersey, and consequently the daily average of appellant's freight cars located on the New Jersey railroad's lines during the tax year could not constitutionally be included in the computation of this Pennsylvania tax. Pp. 370 U. S. 613-614.

3. On the record in this case, Pennsylvania could constitutionally tax at full value the remainder of appellant's fleet of freight cars, including those used by other railroads in other States, since appellant has failed to sustain its burden of proving that a tax situs had been established elsewhere with respect to such cars. Pp. 370 U. S. 614-617.

4. For the purposes of this tax, Pennsylvania could differentiate between railroads having tracks which lay only within its borders and those whose tracks were located both within and without the chanrobles.com-red

Page 370 U. S. 608

State, since such a classification would be reasonable and would not violate the Equal Protection Clause of the Fourteenth Amendment. Pp. 370 U. S. 617-618.

403 Pa. 419, 169 A.2d 878, affirmed in part and reversed in part.