Compania General de Tabacos v. Collector,
275 U.S. 87 (1927)

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U.S. Supreme Court

Compania General de Tabacos v. Collector, 275 U.S. 87 (1927)

Compania General de Tabacos de Filipinas v.

Collector of Internal Revenue

No. 42

Argued October 18, 19, 1927

Decided November 21, 1927

275 U.S. 87


1. A foreign corporation which has property and does business through agents in the Philippine Islands is subject to the taxing power of the Island government as a quasi-sovereign, but the power is limited by the Organic Act. P. 275 U. S. 92.

2. The liberty secured by the Organic Act embraces the right to make contracts and accumulate property and do business outside of the Philippine Islands and beyond its jurisdiction without prohibition, regulation, or governmental exaction. P. 275 U. S. 92.

Page 275 U. S. 88

3. A merchandising corporation organized and having its headquarters in a foreign country, with property and local agents in the Philippines, cannot be taxed by the Philippine government upon the premiums for the insurance of it goods shipped from the Islands, paid abroad upon a marine policy entered into abroad with a foreign insurance company having no license or agent in the Islands, and to be performed abroad. P. 275 U. S. 92.

4. This is true whether the imposition be regarded as a penalty or a a tax, and regardless of its amount. The purpose in either case is to discourage insurance in outside companies by regulating the conduct of the insured not within the local jurisdiction. P. 275 U. S. 95.

5. Where a foreign corporation doing business in the Philippine Islands insures goods in the Islands against fire, in a foreign insurance company which is licensed to do business there, the premiums paid are subject to taxation by the Philippine government even though the policy was executed and the payments made in a foreign country where the assured had its headquarters. P. 275 U. S. 98.

48 P.I. 35 reversed in part; affirmed in part.

Certiorari, 271 U.S. 655, to a judgment of the Supreme Court of the Philippine Islands which affirmed a judgment dismissing an action brought by the present petitioner to recover the money demanded of it by the respondent as taxes on insurance premiums, and which the petitioner paid under protest.

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