1. "Sweet chocolate" and "sweet milk chocolate," which contain
sugar in addition to chocolate or chocolate and milk solid, and
which are widely known, distributed, and used as confectionery, are
"candy" within the meaning of §§ 900(9), Revenue Act of 1918 and
900(6), Revenue Act of 1921, imposing excise on the sales price of
candy and other luxuries. P.
283 U. S.
490.
2. Administrative construction of a doubtful statute will not be
lightly disturbed. P.
283 U. S.
492.
3. Reenactment of a statutory provision without change in the
face of a consistent administrative construction is persuasive of a
legislative recognition and approval of the statute as construed.
Id.
42 F.2d 408 reversed.
Certiorari,
282 U. S. 827, to
review judgments which reversed judgments in favor of the
above-named collectors in suits in the district court for recovery
of money collected as taxes.
MR. JUSTICE STONE delivered the opinion of the Court.
Section 900 of the Revenue Act of 1918, 40 Stat. 1057, 1122,
imposed at varying percentages, an excise tax upon
Page 283 U. S. 490
the sales price of enumerated articles, most of which may be
characterized as luxuries. The enumeration of the ninth subdivision
was, "Candy, 5 percentum." Section 900(6) of the Revenue Act of
1921, 42 Stat. 227, 292, reenacted this provision but reduced the
tax to 3 percent. Respondents, manufacturers of "sweet chocolate"
and "sweet milk chocolate," brought suits in the district court for
Eastern Pennsylvania, to recover about $8,000,000 of taxes assessed
under these sections for the years 1918 to 1924, on the ground that
the articles sold are not "candy," sale of which was taxed. On
written stipulation of the parties, the cases were tried by the
court without a jury. Judgments for petitioners were reversed by
the Court of Appeals for the Third Circuit. 42 F.2d 408. This Court
granted certiorari,
282 U. S. 827, to
resolve the conflict of the decision below with that of the Court
of Appeals for the First Circuit in
Malley v. Walter Baker
& Co., 281 F. 41.
The trial court found that sweet chocolate is a solid or plastic
mass, made by mixing sugar with chocolate, which is the powdered
cacao nib or bean, with or without the addition of flavoring
material, and that sweet milk chocolate also contains milk solids;
that the type of sweet chocolate manufactured and sold by
respondents is commonly sold in small bars, sometimes containing
nuts, or in blocks, "attractively dressed up" for sale under names
which would appeal to candy consumers, and is usually consumed in
the same manner as candy -- that is, eaten in small quantities from
the hand as a sweetmeat. One of the respondents described its
product as a "confection" upon some of its labels and display
matter.
Respondents rest their case mainly upon differences in
composition of sweet chocolate from that of confectionery, made
principally of sugar or molasses, with or without the addition of
coloring or flavoring matter, which, it is urged, is alone
described by the word "candy." They
Page 283 U. S. 491
assert that chocolate is food, and candy is not, and hence
chocolate cannot be properly described as candy. But it is common
knowledge that sugar, also a food, is an ingredient both of candy
as thus defined and of sweet chocolate, sometimes to the extent of
50 percent or more of the latter, as was conceded on the argument
here. We likewise know, as was conceded, that chocolate in a great
variety of forms is an important ingredient of what is commonly
known as candy, and that pieces of sweet chocolate of the type
described by the findings are often included in packages of
confectionery commonly sold as candy. These considerations at least
suggest that the form and use of sugar compounds, intended for
taste gratifying consumption, are quite as important in determining
whether they are candy as their particular composition.
See
Malley v. Walter Baker & Co., supra, p. 46.
No doubt the word "candy," in view of its use to designate
confections made principally of sugar before the widespread
consumption of sweet chocolate preparations as confections or
sweetmeats, and as the dictionary suggests, may be used in this
narrower and more restricted sense. But it may be, and we think is,
used, as the dictionary also suggests, in a popular and more
general sense, as synonymous with sugar compounds sold and used as
confectionery or sweetmeats, and embraces them as well as candy
made chiefly of sugar.
If it were necessary to our decision, in the absence of any
controlling legislative history or any suggested plausible reason
why a tax on candy, in a general revenue measure taxing luxuries,
should be deemed to apply to one type of confectionery and not the
other, we should hesitate to say that the word was used in its
restricted sense, or to hold that a substance made of sugar and
chocolate, a widely known and popular form of confectionery
identified, in use and method of distribution, with other
Page 283 U. S. 492
types of confectionery known as "candy," was not intended to be
taxed.
See DeGanay v. Lederer, 250 U.
S. 376,
250 U. S. 381;
Van Camp & Sons v. American Can Co., 278 U.
S. 245,
278 U. S.
253.
Possible doubts as to the proper construction of the language
used should be resolved in the light of its administrative and
legislative history. Shortly after the adoption of the 1918 Act,
Art. 22 of Regulations 47, May 1, 1919, announced that "Candy
within the meaning of the act includes . . . sweet chocolate and
sweet milk chocolate, whether plain or mixed with fruit or nuts."
This continued to be the ruling of the Treasury Department until
the repeal of the tax by § 1100(a) of the Revenue Act of 1924, 43
Stat. 253, 352. It and later regulations excluded unsweetened
chocolate from the tax and, as revised in December, 1920, the
regulation, and also Article 19 of Regulations 47, January 6, 1922,
under the 1921 Act, excluded from the tax all sweet chocolate which
obviously would not be consumed in the condition or form in which
sold. This was but a recognition that use may be a determining
factor in ascertaining what sugar compounds are embraced in the
word candy.
The administrative construction was upheld in 1922 by
Malley
v. Walter Baker & Co., supra, the only case, other than
the present, which has considered it. The provision has been
consistently enforced as construed, was reenacted by Congress in
the 1921 Act, and remained on the statute books without amendment
until its repeal. Such a construction of a doubtful or ambiguous
statute by officials charged with its administration will not be
judicially disturbed except for reasons of weight, which this
record does not present.
See Brewster v. Gage,
280 U. S. 327,
280 U. S. 336;
Universal Battery Co. v. United States, 281 U.
S. 580,
281 U. S. 583;
Fawcus Machine Co. v. United States, 282 U.
S. 375,
282 U. S. 378.
The reenactment of the statute by Congress, as well as the failure
to amend it in the face of the consistent
Page 283 U. S. 493
administrative construction, is at least persuasive of a
legislative recognition and approval of the statute as construed.
See National Lead Co. v. United States, 252 U.
S. 140,
252 U. S. 146.
We see no reason for rejecting that construction.
The court below found support for its decision in the fact that
various tariff and revenue acts have separately classified candy
and chocolate, and respondents make the point here. But it is to be
noted that in none of the acts cited does the word candy appear
alone, as in the present statute. In the earlier tariff acts, the
duty was laid on "sugar candy."
See Act of August 10,
1970, 1 Stat. 180; Act of June 7, 1794, 1 Stat. 390. In those of
August 5, 1909, 36 Stat. 11; October 3, 1913, 38 Stat. 144, and
September 21, 1922, 42 Stat. 858, which may be taken as typical, a
duty was imposed on importations of "sugar candy and all
confectioners not specially provided for" at one rate and by a
different paragraph, on chocolate at a different rate. The
differences in rate made classification necessary, and as the cacao
bean is not produced in the United States and sugar is, that fact
may be taken to account in a tariff act for the differences both in
rate and classification. But a difference in composition,
relatively minor so far as it has any hearing on the general
character of the product or its use, is of little moment in
determining whether the product falls within or without a single
class of luxuries taxed, for revenue only at a single rate.
Similarly, rulings of the Department of Agriculture setting up
standards under the Pure Food Laws for the composition of various
types of confectionery, including sweet chocolate, throw no light
on the present problem.
Nor do we think of significance the fact, relied upon here and
by the court below, that statements inconsistent with the
conclusion which we reach were made to committees of Congress or in
discussions on the floor of the Senate by senators who were not in
charge of the bill.
Page 283 U. S. 494
For reasons which need not be restated, such individual
expressions are without weight in the interpretation of a statute.
See Duplex Co. v. Deering, 254 U.
S. 443,
254 U. S. 474;
Lapina v. Williams, 232 U. S. 78,
232 U. S. 90;
United States v. Trans Missouri Freight Assn.,
166 U. S. 290,
166 U. S.
318.
Reversed.