the court held that the premiums refunded to policy holders of domestic fire insurance companies are not to be taxed under section 187, since no "business is done" after the cancellation of the policy.

CHAPTER IX.

ANNUAL FRANCHISE TAX ON TRUST COMPANIES, SAVINGS BANKS, INVESTING COMPANIES AND FOREIGN BANKERS.

Relieved from all other taxes.-Trust companies were intended. to be relieved by section 188 (former sec. 187-a), Tax Law, from taxation on personal property for all other purposes from the date of the passage of the act, March 21, 1901. Binghamton Trust Co. v. Binghamton, 72 App. Div. 341 (1902).

Franchise tax on trust companies.-Every trust company, incorporated, organized or formed under, by or pursuant to a law of this state, and any company authorized to do a trust company's business solely or in connection with any other business, under a general or special law of this state, shall pay to the state annually for the privilege of exercising its corporate franchise or carrying on its business in such corporate or organized capacity, an annual tax which shall be equal to one per centum on the amount of its capital stock, surplus and undivided profits. (Sec 188, former sec. 187-a, Tax Law, added by ch. 132, L. 1901, and amended by oh. 535, L. 1901.)

Apportionment of tax.-The basis of the tax is the average amount of capital, surplus and undivided profits during the preceding year. This is more equitable to both the trust company and state than if a special date was fixed upon which same should be taken, for such a date might find the trust company with either an unusually large or an unusually small amount of surplus and undivided profits. If the trust company has not been doing business during the entire fiscal year, the tax must be apportioned accordingly. People ex rel. Mutual Trust Co. v. Miller, 177 N. Y. 51 (1903); see People ex rel. Bklyn R. T. Co. v. Morgan, 57 App. Div. 335; People ex rel. Lincoln Trust Co. v. Glynn (1909), 132 A. D. 546, aff'd 198 N. Y. 501, holding also that the method of

taxing trust companies had not been changed by the 1906 amendment to section 182, making tax payable in advance.

Sec. 188-a. Taxation of investment companies.-Every investment company incorporated, organized or formed under, by or pursuant to the banking law of this state and actually exercising the powers conferred by both subdivisions two and four of section two hundred and ninety-three of the banking law, shall annually pay to the state, for the privilege of exercising its corporate franchise or carrying on its business in such corporate or organized capacity, a tax of an amount equal to one and one-half mills for every dollar face value of its capital, and in addition thereto a tax equal to one per centum of its surplus and undivided profits.

This section was added by Chapter 707, Laws of 1917, as a substitute for the tax on personal property (from which these investment companies are now exempt under Article I, Section 4, Subdivision 14, of the Tax Law). It applies only to the so-called Morris Plan Companies.

Franchise tax on savings banks.—Every savings bank incorporated, organized or formed under, by or pursuant to a law of this state, shall pay to the state annually for the privilege of exercising its corporate franchises or carrying on its business in such corporate or organized capacity, an annual tax which shall be equal to one per centum on the par value of its surplus and undivided earnings. (Sec. 189, Tax Law, formerly sec. 187-b, added by ch. 117, L. 1901.)

Purchase of state bonds; credit to be given.-Every corporation, company or association required by section one hundred and eightyseven, one hundred and eighty-eight or one hundred and eighty-nine of this chapter, to pay to the state an annual tax equal to a percentage of its gross premiums, capital stock, surplus, undivided profits or undivided earnings, or one or more, for the privilege of exercising its corporate franchise or carrying on its business in such corporate or organized capacity, which shall own any of the bonds of the state of New York, shall have credited to it annually to apply upon or in lieu of the payment of such tax an amount equal to one and one-half per centum of the par value of all such bonds of the state, bearing interest at a rate not exceeding three per centum per annum, owned by such corporation, company or association, and registered in its name or registered in the name of a public department, a public officer or officers of this state, or of any state, or of the United States, in trust for such corporation, company or association, on the thirtieth day of June prior to the date when such tax shall become due and

payable; provided, however, that there shall in no case be credited to any such corporation, company or association an amount in excess of the amount due to the state from such corporation, company or association for taxes payable to the state under this chapter for the fiscal year for which such credit is given; and further provided that any such credit so allowed under this section shall not bear interest. (Section 190 of the Tax Law, as amended by ch. 357 of the Laws of 1913, and ch. 794, L. 1913.) The latter amendment of 1913 eliminated the former, so there is no change in the statute.

Source: Former Sec. 187c, Tax Law, as added by ch. 550, L. 1907, and am'd by ch. 228, L. 1908.

Exception. Bonds registered with an officer of the Dominion of Canada in trust for policy holders are not entitled to the exemption from taxation provided for in this section. (Report Atty. Genl. [1914], 129.)

Bonds, etc., forming surplus not to be valued above par.Bonds and securities in which surplus may be invested are to be assessed at market value, if below par, and at face value if above par. People ex rel. Bank for Savings v. Miller, 177 N. Y. 461 (1904).

Tax upon foreign bankers.-Every foreign banker doing business in this state, shall annually pay to the treasurer a tax of five per centum on the amount of interest or compensation of any kind earned and collected by him on money loaned, used or employed in this state by such banker.

The term, doing a banking business, as used in this section means doing such business, as a corporation may be created to do under article three of the banking law, or doing any business which a corporation is authorized by such article to do. The term, foreign banker doing a banking business in this state, as used in this section includes:

1. Every foreign corporation doing a banking business in this state, except a national bank.

2. Every unincorporated company, partnership or association, of two or more individuals, organized under or pursuant to the laws of another state or country, doing a banking business in this state.

3. Every other unincorporated company, partnership or association, of two or more individuals, doing a banking business in this state, if the members thereof, owning more than a majority interest therein,

or entitled to more than one-half of the profits thereof, or who would, if it were dissolved, be entitled to more than one-half of the net assets thereof, are not residents of this state.

4. Every non-resident of this state, doing a banking business in this state, in his own name and right only. (Section 191, former sec. 188, Tax Law, as amended by ch. 500, L. 1900.)