This was an action brought in the Mobile circuit court, in the state of Alabama, by the Port of Mobile, a municipal corporation, against Edward Leloup, agent of the Western Union Telegraph Company, to recover a penalty imposed upon him for the violation of an ordinance of said corporation, adopted in pursuance of the powers given to it by the legislature of Alabama, and in force in August, 1883. The ordinance was as follows, to- wit: 'Be it ordained by the Mobile Police Board, that the license tax for the year, from the 15th of March, 1883, to the 15th of March, 1884, be, and the same is hereby, fixed as follows: ... On telegraph companies, $ 225. ... Be it further ordained: For each and every violation of the aforesaid ordinance the person convicted thereof shall be fined by the recorder not less than one nor more than fifty dollars.' The complaint averred that the defendant, being the managing agent of the Western Union Telegraph Company, a [127 U.S. 640, 642] corporation having its place of business in the said port of Mobile, and then and there engaged in the business and occupation of transmitting telegrams from and to points within the state of Alabama and between the private individuals of the state of Alabama, as well as between citizens of said state and citizens of other states, committed a breach of said ordinance by neglecting and refusing to pay said license to the said municipal corporation. The complainant further averred that for this breach the recorder of the port of Mobile imposed on the defendant a fine of five dollars, for which sum the suit was brought. The defendant pleaded that at the time of the alleged breach of said ordinance he was the duly appointed manager, at the port of Mobile, of the Western Union Telegraph Company. That said company 'was, prior to the 5th day of June, 1867, a telegraph company duly incorporated and organized under the laws of the state of New York, and by its charter authorized to construct, maintain, and operate lines of telegraph in and between the various states of the Union, including the state of Alabama. That on said 5th day of June, 1867, the said telegraph company duly filed its written acceptance with the postmaster general of the United States of the restrictions and obligations of an act of congress entitled 'An act to aid in the construction of telegraph lines, and to secure to the government the use of the same for postal, military, and other purposes,' approved July 24, 1866. That in accordance with the authority of its said charter and the said act of congress, ad by agreement with the railroad companies, the said telegraph company constructed its lines, and was at the time of the said alleged breach of said ordinance, maintaining, and operating said lines of telegraph, on the various public railroads leading into or through the said port of Mobile, to-wit, the Mobile & Ohio Railroad, a railroad extending from the said port of Mobile, in Alabama, through the states of Mississippi, Tennessee, and Kentucky, to Cairo, in the state of Illinois; the Louisville & Nashville Railroad, extending from Cincinnati, in the state of Ohio, through said port of Mobile, to New Orleans, in the state of [127 U.S. 640, 643] Louisiana, with a branch extending from said state of Alabama over the Pensacola & Louisville Railroad to Pensacola, in the state of Florida. That the said telegraph lines so running into or through said port of Mobile connected with and extended beyond the termini of the said railroads over other railroads, making continuous lines of telegraph from the office of said company, in said port of Mobile, to, through, and over all of the principal railroads, post roads, and military roads in and of the United States, and having offices for the transaction of telegraph business in the departments at Washington, in the District of Columbia, and in all of the principal cities, towns, and villages in each of the United States, and in the territories thereof. That all of said railroads so leading into and through the said port of Mobile and elsewhere in the United States are public highways, and that the daily mails of the United States are regularly carried thereon, under authority of law and the direction of the postmaster general, and that said railroads and each of them are post roads of the United States. That said telegraph lines are also constructed under and across the navigable streams of the United States, in the state of Alabama and in the other states of the Union, but in all cases said lines are so constructed and maintained as not to obstruct the navigation of such streams and the ordinary travel on such military and post roads. That the said telegraph company was, before and during said year, commencing March 15, 1883, and now is, engaged in the business of sending and receiving telegrams over said lines for the public between its said office in the port of Mobile and other places in other states and territories of the United States, and to and from foreign countries; also in sending telegraphic communications between the several departments of the government of the United States, and their officers and agents, giving priority to said official telegraphic communications over all other business. And defendant avers that said official telegrams have been and are sent at rates which have been fixed by the postmaster general annually since the said 5th of June, 1867. And defendant avers that as the manager of said company, and in its name and under its direction and [127 U.S. 640, 644] appointment, and in no other manner or capacity, was he engaged in said telegraph business at the time and the manner as alleged in said complaint.' To this plea a demurrer was filed and sustained by the court, and judgment was given for the plaintiff; and, on appeal to the supreme court of Alabama, this judgment was affirmed. The present writ of error is brought to review the judgment of the supreme court. That court adopted its opinion given on a previous occasion between the same parties, in which the circuit court had decided in favor of the defendant, and its decision was reversed. In that opinion the supreme court said: 'The defense was that the ordinance is an attempt to regulate commerce, and violative of the clause of the constitution of the United States which confers on congress the 'power to regulate commerce with foreign nations and among the several states.' The circuit court held the defense good, and gave judgment against the port of Mobile. Is the ordinance a violation of the constitution of the United States? We will not gainsay that this license tax was imposed as a revenuem easure,-as a means of taxing the business, and thus compelling it to aid in supporting the city government. That no revenue for state or municipal purposes can be derived from the agencies or instrumentalities of commerce no one will contend. The question generally mooted is, how shall this end be attained? In the light of the many adjudications on the subject, the ablest jurists will admit that the line which separates the power from its abuse is sometimes very difficult to trace. No possible good could come of any attempt to collate, explain, and harmonize them. We will not attempt it. We confess ourselves unable to daw a distinction between this case and the principle involved in Osborne v. Mobile, 16 Wall. 479. In that case the license levy was upheld, and we think it should be in this. Joseph v. Randolph, 71 Ala. 499.'
In approaching the question thus presented, it is proper to note that the license tax in question is purely a tax on the privilege of doing the business in which the telegraph company was engaged. By the laws of Alabama in force at the time this tax was imposed, the telegraph company was [127 U.S. 640, 645] required, in addition, to pay taxes to the state, county, and port of Mobile, on its poles, wires, fixtures, and other property, at the same rate and to the same extent as other corporations and individuals were required to do. Besides the tax on tangible property, they were also required to pay a tax of three-quarters of 1 per cent. on their gross receipts within the state. The question is squarely presented to us, therefore, whether a state, as a condition of doing business within its jurisdiction, may exact a license tax from a telegraph company, a large part of whose business is the transmission of messages from one state to another and between the United States and foreign countries, and which is invested with the powers and privileges conferred by the act of congress passed July 24, 1866, and other acts incorporated in title 45 of the Revised Statutes? Can a state prohibit such a company from doing such a business within its jurisdiction, unless it will pay a tax and procure a license for the privilege? If it can, it can exclude such companies, and prohibit the transaction of such business altogether. We are not prepared to say that this can be done. Ordinary occupations are taxed in various ways, and, in most cases, legitimately taxed. But we fail to see how a state can tax a business occupation when it cannot tax the business itself. Of course, the exaction of a license tax as a condition of doing any particular business is a tax on the occupation; and a tax on the occupation of doing a business is surely a tax on the business. Now, we have decided that communication by telegraph is commerce, as well as in the nature of postal service, and, if carried on between different states, it is commerce among the several states, and directly within the power of regulation conferred upon congress, and free from the control of state regulations, except such as are strictly of a police character. In the case of Telegraph Co. v. Telegraph Co., 96 U.S. 1 , we held that it was not only the right, but the duty, of congress to take care that intercourse among the states and the transmission of intelli- [127 U.S. 640, 646] gence between them be not obstructed or unnecessarily encumbered by state legislation; and that the act of congress passed July 24, 1866, above referred to, so far as it declares that the erection of telegraph lines shall, as against state interference, be free to all who accept its terms and conditions, and that a telegraph company of one state shall not, after accepting them, be excluded by another state from prosecuting its business within her jurisdiction, is a legitimate regulation of commercial intercourse among the states, and is also appropriate legislation to execute the powers of congress over the postal service. In Telegraph Co. v. Texas, 105 U.S. 460 , we decided that a state cannot lay a tax on the interstate business of a telegraphc ompany, as it is interstate commerce, and that, if the company accepts the provisions of the act of 1866, it becomes an agent of the United States, so far as the business of the government is concerned; and state laws are unconstitutional which impose a tax on messages sent in the service of the government, or sent by any persons from one state to another. In the present case, it is true, the tax is not laid upon individual messages, but it is laid on the occupation, or the business of sending such messages. It comes plainly within the principle of the decisions lately made by this court in Robbins v. Taxing Dist., 120 U.S. 489 , 7 Sup. Ct. Rep. 592, and Steam-Ship Co. v. Pennsylvania, 122 U.S. 326 , 7 Sup. Ct. Rep. 1118. It is parallel with the case of Brown v. Maryland, 12 Wheat. 419. That was a tax on an occupation, and this court held that it was equivalent to a tax on the business carried on, (the importation of goods from foreign countries,) and even equivalent to a tax on the imports themselves, and therefore contrary to the clause of the constitution which prohibits the states from laying any duty on imports. The Maryland act which was under consideration in that case declared that 'all importers of foreign articles or commodities,' etc ., 'and all other persons selling the same by wholesale,' etc., 'shall, before they are authorized to sell, take out a license, ... for which they shall pay fifty dollars,' etc., subject to a penalty for neglect or refusal. Chief Justice TANEY, referring to the [127 U.S. 640, 647] case of Brown v. Maryland, in Almy v. State of California, 24 How. 169, 173, in which it was decided that a state stamp tax on bills of lading was void, said: 'We think this case cannot be distinguished from that of Brown v. Maryland. That case was decided in 1827, and the decision has always been regarded and followed as the true construction of the clause of the constitution now in question. ... The opinion of the court, delivered by Chief Justice MARSHALL, shows that [the case] was carefully and fully considered by the court. And the court decided that this state law, [the Maryland law under consideration in Brown v. Maryland,] and the mode of imposing it, by giving it the form of a tax on the occupation of the importer, merely varied the form in which the tax was imposed, without varying the substance.' But it is urged that a portion of the telegraph company's business is internal to the state of Alabama, and therefore taxable by the state. But that fact does not remove the difficulty. The tax affects the whole business without discrimination. There are sufficient modes in which the internal business, if not already taxed in some other way, may be subjected to taxation, without the imposition of a tax which covers the entire operations of the company. The state court relies upon the case of Osborne v. Mobile, 16 Wall. 479, which brought up for consideration an ordinance of the city, requiring every express company, or railroad company doing business in that city, and having a business extending beyond the limits of the state, to pay an annual license of $500; if the business was confined within the limits of the state, the license fee was only $100; if confined within the city, it was $ 50; subject in each case to a penalty for neglect or refusal to pay the charge. This court held that the ordinance was not unconstitutional. This was in December term, 1872. In view of the course of decisions which have been made since that time, it is very certain that such an ordinance would now be regarded as repugnant to the power conferred upon congress to regulate commerce among the several states. [127 U.S. 640, 648] A great number and variety of cases involving the commercial power of congress have been brought to the attention of this court during the past 15 years which have frequently made it necessary to re-examine the whole subject with care; and the result has sometimes been that, in order to give full and fair effect to the different clauses of the cos titution, the court has felt constrained to recur to the fundamental principles stated and illustrated with so much clearness and force by Chief Justice MARSHALL and other members of the court in former times, and to modify in some degree certain dicta and decisions that have occasionally been made in the intervening period. This is always done, however, with great caution, and an anxious desire to place the final conclusion reached upon the fairest and most just construction of the constitution in all its parts. In our opinion, such a construction of the constitution leads to the conclusion that no state has the right to lay a tax on interstate commerce in any form, whether by way of duties laid on the transportation of the subjects of that commerce, or on the receipts derived from that transportation, or on the occupation or business of carrying it on, and the reason is that such taxation is a burden on that commerce, and amounts to a regulation of it, which belongs solely to congress. This is the result of so many recent cases that citation is hardly necessary. As a matter of convenient reference, we give the following list: Case of State Freight Tax, 15 Wall. 232; Telegraph Co. v. Telegraph Co., 96 U.S. 1 ; Mobile v. Kimball, 102 U.S. 691 ; Telegraph Co. v. Texas, 105 U.S. 460 ; Moran v. New Orleans, 112 U.S. 69 , 5 Sup. Ct. Rep. 38; Ferry Co. v. Pennsylvania, 114 U.S. 196 , 5 Sup. Ct. Rep. 826; Brown v. Houston, 114 U.S. 622 , 5 Sup. Ct. Rep. 1091; Walling v. Michigan, 116 U.S. 446 , 6 Sup. Ct. Rep. 454; Pikard v. Car Co., 117 U.S. 34 , 6 Sup. Ct. Rep. 635; Railway Co. v. Illinois, 118 U.S. 557 , 7 Sup. Ct. Rep. 4; Robbins v. Taxing Dist., 120 U.S. 489 , 7 Sup. Ct. Rep. 592; Steam-Ship Co. v. Pennsylvania, 122 U.S. 326 , 7 Sup. Ct. Rep. 1118; Telegraph Co. v. Pendleton, 122 U.S. 347 , 7 Sup. Ct. Rep. 1126; Ratterman v. Telegraph Co., ante, 1127. We may here repeat, what we have so often said before, [127 U.S. 640, 649] that this exemption of interstate and foreign commerce from state regulation does not prevent the state from taxing the property of those engaged in such commerce located within the state as the property of other citizens is taxed, nor from regulating matters of local concern which may incidentally affect commerce, such as wharfage, pilotage, and the like. We have recently had before us the question of taxing the property of a telegraph company, in the case of Telegraph Co. v. Massachusetts, 125 U.S. 530 , ante, 961. The result of the conclusion which we have reached is that the judgment of the supreme court of Alabama must be reversed, and the cause remanded, with instructions to reverse the judgment of the Mobile circuit court; and it is so ordered.