The issue involved on this appeal is whether appellant school district is liable for payment of unemployment payroll taxes on its employees, other than faculty members, for the period from January 1, 1962, to May 18, 1963, inclusive. The determination of the issue hinges upon the construction of certain sections of the statute and construction of the definition of "covered employment". The facts are undisputed.
Prior to 1961, I.C. § 72-1316(a)(6) provided that "covered employment" excluded:
The legislature in 1961, by H.B. 138 (S. L. 1961, ch. 112), enacted I.C. § 72-1316B setting forth a new exclusion in this area of covered employment; portions thereof read:
The legislature in 1963, by H.B. 72 (S.L. 1963, ch. 92), amended I.C. § 72-1316B to read:
This enactment became law March 12, 1962.
Thereafter the legislature in 1963, by H. B. 131 (S.L. 1963, ch. 318), amended I.C. § 72-1316(a)(6) and repealed I.C. § 72-1316B, as follows:
This enactment became law March 28, 1963, effective May 18, 1963, 60 days after the legislature adjourned. I.C. § 67-510.
In January 1962 appellant school district began paying payroll taxes on all of the employees, other than school teachers, and continued payment thereof through the four quarters of 1962. Appellant refused thereafter to pay such taxes for the first quarter of 1963, and demanded a refund from respondent of all sums paid during the year 1962.
Thereafter upon the conclusion of hearings had, respondent's appeals examiner determined that appellant school district was liable for payment of payroll taxes for the period from January 1, 1962, to May 18, 1963, inclusive, and denied appellant's demand for refund.
The Industrial Accident Board, upon appellant school district's appeal, entered an order affirming the decision of the appeals examiner. The school district thereupon perfected an appeal to this Court.
Appellant by its assignments asserts that the Board erred in determining that appellant was liable for payment of payroll taxes for the portion of the year 1963 to and including May 18, 1963, and in refusing to grant to appellant a refund for such taxes paid during the year 1962; also in determining that liability for payment of such taxes was lawfully imposed under constitutionally adopted law.
The following furnishes a brief reference to the laws and their respective provisions pertinent herein:
The various enactments will be considered in the order of their adoption by the legislature.
Appellant raises the question as to which enactment is controlling, i.e., H.B. 138 (1961 enactment) which sought to impose liability upon appellant for payment of the payroll taxes, or I.C. § 72-1316(a)(6) which excepted appellant from imposition of any such liability.
Appellant points out that H.B. 138 (1961 enactment) sought to impose liability for payment of such taxes upon the payroll of employees who were not members of faculties of public schools; whereas H.B. 138 did not amend I.C. § 72-1316(a)(6) which
"[I]n case of an irreconcilable inconsistency between statutes in pari materia the latest expression of the legislative will should control." Lloyd Corporation v. Bannock County, 53 Idaho 478, 25 P.2d 217 (1933). See also Little v. Nampa-Meridian Irrigation District, 82 Idaho 167, 350 P.2d 740 (1960); Herrick v. Gallet, 35 Idaho 13, 204 P. 477 (1922); Peavy v. McCombs, 26 Idaho 143, 140 P. 965 (1914). To the extent that there is conflict in the provisions of I. C. § 72-1316(a)(6) enacted prior to the 1961 legislature, and H.B. 138, enacted by the 1961 legislature, the latter is controlling and must prevail, commencing as of January 1, 1962, as provided in the first paragraph of such enactment.
Appellant contends that H.B. 72 (1963 enactment) which amended I.C. § 72-1316B to exclude from covered employment all employees of school districts, had a retroactive application to January 1, 1962, as set forth in H.B. 138 (1961 enactment), and that therefore the legislature intended that appellant school district be exempted from liability for payment of payroll taxes on its entire payroll back to January 1, 1962. Appellant argues, although the amendment, H.B. 72, does not specifically provide for retroactive operation, nevertheless by setting out the provision contained in the original 1961 enactment of I.C. § 72-1316B that it become effective January 1, 1962, shows the legislative intent that the amendment shall have such retroactive effect.
An inspection of H.B. 72 (1963 enactment) shows that the 1963 legislature amended only paragraph (2) of I.C. § 72-1316B, to exclude from covered employment, "all other employees of public school districts", in addition to the 1961 exclusion of "members of the faculties". The applicable rule of construction is set forth in I.C. § 67-511, which reads:
See also State ex rel. Nielson v. McCarty, 76 Idaho 153, 279 P.2d 879 (1955); John Hancock Mut. Life Ins. Co. v. Haworth, 68 Idaho 185, 191 P.2d 359 (1948); 82 C.J.S. Statutes § 384, p. 903. We therefore conclude that the amendatory portion of H. B. 72 (1963 enactment) cannot be accorded a retroactive application.
Appellant poses the query: Did H. B. 131 (1963 enactment) repeal only H.B. 138 (1961 enactment) codified as I.C. § 72-1316B; or did H.B. 131 also repeal I.C. § 72-1316B as amended by H.B. 72 (1963 enactment)?
The legislature by its latest enactment H. B. 131 (1963 enactment) specifically repealed I.C. § 72-1316B, as amended by the previous enactment H.B. 72 (1963 enactment); and by amendment to I.C. § 72-1316 (a)(6), continued to exclude from covered employment all services performed in the employ of any school district.
In addition, the legislature altered the original language of I.C. § 72-1316B. Its original language excluded from covered employment services performed in the employ of a public institution which pays its employees out of moneys raised solely by exercise of the power of taxation, including school districts. While the amendment H.B. 131 (1963 enactment) did not disturb the effect of I.C. § 72-1316B as amended by H.B. 72 (1963 enactment) to the effect
"[W]here a statute is amended by changing the language from that used in the original statute, the presumption arises that a change in application was intended." Anderson v. Rayner, 60 Idaho 706, 96 P.2d 244 (1939). See also Hopson v. North American Ins. Co., 71 Idaho 461, 233 P.2d 799 (1951). H.B. 131 (1963 enactment) repealed I.C. § 72-1316B, as amended.
Appellant attacks H.B. 138 (1961 enactment) codified as I.C. § 72-1316B, as discriminatory legislation violative of the equal protection clause of U. S. Const., 14th Amendment, because such enactment excluded public school employees, except members of faculties; that thereby the act discriminated against faculty members, although their remuneration was paid "out of moneys raised solely by the exercise of the power of taxation", the same as other employees.
I.C. § 72-1316B enumerated two classes of employment, i. e., one excluded from covered employment being members of faculties or professional employment; and the other implicity included in covered employment all other types of employment.
81 C.J.S. Social Security and Public Welfare § 83a, p. 124, states:
Diefendorf v. Gallet, 51 Idaho 619, 642, 10 P.2d 307, 316 (1932), enunciates the following rule:
See also Batt v. Unemployment Comp. Div., 63 Idaho 572, 123 P.2d 1004, 139 A.L.R. 1157 (1942); John Hancock Mut. Life Ins. Co. v. Haworth, 68 Idaho 185, 191 P.2d 359 (1948); United Pacific Ins. Co. v. Bakes, 57 Idaho 537, 67 P.2d 1024 (1937); J. C. Penney Co. v. Diefendorf, 54 Idaho 374, 32 P.2d 784 (1934).
Florek v. Sparks Flying Service, Inc., 83 Idaho 160, 359 P.2d 511 (1951), contains the following statement:
Every intendment in favor of the constitutionality of a statute must prevail.
We therefore conclude that H.B. 138 (1961 enactment) codified as I.C. § 72-1316B, was not discriminatory legislation; and that the classifications of employment within its purview, one included in, and the other excluded from, covered employment, were reasonable and founded upon differences between the parties.
Appellant further attacks the constitutionality of H.B. 138 (1961 enactment) codified as I.C. § 72-1316B. Appellant contends that the contributions required to be paid to the employment security fund, levied on an employer's payroll paid to employees, is not an excise tax but a license tax; and that when applied to school districts, as employers, such license tax is in violation of Idaho Const. Art. VII, § 2, which reads:
Fenton v. Board of County Commrs., 20 Idaho 392, 119 P. 41 (1911), had to do with Idaho Const. Art. VII, § 6, which contains a similar prohibition as contained in the second sentence of Idaho Const. Art. VII, § 2. Art. VII, § 6 reads:
In the Fenton case it was contended that the legislature had no power to authorize the county commissioners to make a tax levy of any kind for the benefit of the school districts of the respective counties, for the reason that such districts are municipal corporations. In answering that contention this Court said:
Idaho Gold Dredging Co. v. Balderston, 58 Idaho 692, 78 P.2d 105 (1938), also dealt with the same subject matter as the Fenton case, supra, and this Court again ruled that the legislature never intended to treat school districts as municipal corporations. See also Barton v. Alexander, 27 Idaho 286, 148 P. 471 (1915).
"The tax or contribution imposed by a state unemployment compensation or insurance statute is an excise tax." Abney v. Campbell, 206 F.2d 836 (5th Cir. 1953); Vaughan v. Warner, 157 F.2d 26 (3rd Cir. 1946); California Employment Commission v. MacGregor, (Cal.Dist.Ct.App. 1944), 64 Cal.App.2d 691, 149 P.2d 304; Big Wood Canal Co. v. Unemployment Comp. Division, 61 Idaho 247, 250, 100 P.2d 49 (1940); Chas. C. Steward Mach. Co. v. Davis, 301 U.S. 548, 57 S.Ct. 883, 81 L.Ed. 1279 (1937); Mozingo v. Mississippi Employment Security Commission, 224 Miss. 375, 80 So.2d 75 (1955); Unemployment Compensation Commission v. Renner, 59 Wyo. 437, 143 P.2d 181 (1943); 81 C.J.S. Social Security and Public Welfare § 139, p. 207. The tax is an excise imposed upon the privilege or right of employing others. Bates v. McLeod, 11 Wn.2d 648, 120 P.2d 472 (1941). It is not a tax on the privilege allowed an individual to work in a certain field. The tax is not a license, but an excise. State v. Leach, 173 Ohio St. 397, 183 N.E.2d 369 (1962).
An excise tax is authorized by Idaho Const. Art. VII, § 2. Northern Pac. Ry. Co. v. Gifford, 25 Idaho 196, 136 P. 1131 (1913); appeal dismissed 235 U.S. 711, 35 S.Ct. 198, 59 L.Ed. 436 (1914); appeal dismissed 242 U.S. 659, 37 S.Ct. 21, 61 L.Ed. 459 (1916); Idaho Gold Dredging Co. v. Balderston, 58 Idaho 692, 709, 78 P.2d 105, 112 (1938).
The order of the Industrial Accident Board is affirmed.
Costs to respondent.
McQUADE, C. J., and McFADDEN, TAYLOR and KNUDSON, JJ., concur.