Delaware General Assembly

CHAPTER 104

BANKS

AN ACT providing for the assessment and taxation of the shares of the capital stock of banks, banking associations, and corporations doing a banking business, having capital stock, and of Trust Companies having capital stock.

Be it enacted by the Senate and House of Representatives of the State of Delaware in, General Assembly met:

Section 1. The terms "bank" and "banks" as used in this Act shall be deemed to comprehend every bank and banking association and every corporation doing a banking business having a capital stock and whose principal place of business is in this State, whether organized under the authority of this State or of the United States; and the terms "trust company" and "trust companies" as used in this Act shall be deemed to comprehend every trust company and every corporation doing a trust company business having capital stock and whose principal place of business is in this State.

Section 2. The shares of the capital stock of banks and trust companies shall be assessed and taxed according to their true value, to be determined in the manner hereinafter prescribed; provided, however, that the assessment and taxation shall not be at a greater rate than is made or assessed upon other moneyed capital in the hands of individual citizens of this State.

Section 3. The value of each share of stock of each bank or trust company shall be ascertained and determined by adding together the amount of the capital, surplus and undivided profits of such bank or trust company, and by dividing the result by the number of outstanding shares of such bank or trust company.

Section 4. For purposes of assessment, the president, cashier or treasurer of every bank and trust company, shall on or before the tenth day of July in the year nineteen hundred and twenty-one, and on or before the tenth day of July in each year thereafter, file with the State Bank Commissioner of this State a true statement, verified by the oath of such president, cashier, or treasurer, setting forth the name of such bank or trust company, the location of its principal place of business, the name and residence of each of its stockholders, and the number of shares held by each, the amount of its capital, surplus, and undivided profits, as the same are indicated by its books on the first day of July of the year in and for which such statement is filed. There shall be kept at the principal place of business of every bank and trust company a full and correct list of the names and residences of its stockholders, and of the number of shares held by each, which said lists shall be subject to the inspection of the State Bank Commissioner, his deputy and clerk.

Section 5. The rate of tax upon the shares of stock of banks and trust companies shall be, throughout this State, one-fifth of one per centum upon the value thereof, as ascertained and fixed in the manner in this Act provided, and the owners of such stock shall be entitled to no deduction from the taxable value of their shares because of the personal indebtedness of such owners.

Section 6. The State Bank Commissioner shall after the tenth day of July and prior to the first day of August in each year, beginning with the year nineteen hundred and twenty-one, ascertain from an inspection of the statements filed as aforesaid, and from any other sources of information which may be open to him, the names and places of business of all banks and trust companies in this State, the number of shares of capital stock of each issued and outstanding, the aggregate amount of the capital, surplus and undivided profits of each, the true value of the total capital stock of each issued and outstanding, and the true value of a single share of each, determined in accordance with the provisions of Section 3 of this Act, and the amount of tax levied upon a single share of each in accordance with the provisions of this Act. The determination of the amount to be the tax on a single share of stock of each of said banks and trust companies as aforesaid, shall be deemed to be the assessment and levying of the tax on each share of its stock subject to taxation under the Constitution of this State and of the United States, subject to review and correction as hereinafter provided.

The amount determined to be the tax on a single share of stock as aforesaid shall, within fifteen days after the same has been determined as aforesaid, be certified by the State Bank Commissioner to the bank or trust company whose stock is affected; and it shall be the duty of every such bank and trust company forthwith to notify its stockholders thereof by posting in some conspicuous place in its principal place of business a list of its stockholders and the amount of the tax levied upon a single share of stock as aforesaid, and in the event that any bank or trust company shall fail to give notice as aforesaid, the State Bank Commissioner is authorized to publish at the expense of such bank or trust company the list of stockholders of such bank or trust company and the amount of the tax levied on a single share of its stock in one issue of a newspaper published in the County wherein the principal place of business of such bank or trust company is located ; provided, however, that the failure to give such notice or to make such publication shall not be deemed or held to invalidate any tax imposed under this Act or to affect the collection thereof.

The assessment so made as aforesaid shall be reviewed and corrected by the State Bank Commissioner upon application by any party interested, prior to the first day of September in the year in which the tax is levied, provided, that upon such application good cause be shown for such correction. The State Bank Commissioner shall without delay send written notice of his determination upon any such application to the applicant, by mail to the applicant's post office address.

Section 7. The shares of stock of stockholders taxed under this Act shall be deemed and held to be taxed in the City or Town where the principal place of business of the bank or trust company issuing such capital stock is located and not elsewhere. The tax assessed against such stockholders as aforesaid shall be a lien upon their stock from the first day of September in the year in which the tax is determined as aforesaid.

Section 8. If any bank or trust company shall by authority of a resolution duly adopted "by its directors, notify the State Bank Commissioner that it desires to relieve its stockholders of any assessment of their stock under this Act, and that it will on or before the first day of October in each year thereafter until the adoption of a resolution of withdrawal as hereinafter provided pay to the said State Bank Commissioner a sum equal to one-fifth of one per centum of the aggregate of its capital, surplus and undivided profits without any deduction, then and in such case it shall not be necessary for such bank or trust company to include in its statement filed under the provisions of Section 4 of this Act, the names, residences and holdings of its stockholders, or to notify its stockholders of the assessment of their stock as provided in section 6 of this Act. Every bank and trust company notifying the State Bank Commissioner as aforesaid shall be deemed and held to be indebted to the State of Delaware in a sum equal to one-fifth of one per centum of the aggregate of its capital, surplus and undivided profits, payable on or before the first day of October in each year until the adoption of a resolution of withdrawal as hereinafter provided, and the said indebtedness together with a penalty of one percentum for each month or fraction of a month after the first day of October that the same remains unpaid may be collected by the State Bank Commissioner in the name of the State of Delaware by distress or by action of debt ; provided, that nothing herein contained shall be construed as a taxation of property as distinguished from capital stock. The notice to the State Bank Commissioner of the desire to relieve stockholders of the assessment of their stock shall be by filing with the said Commissioner a copy of the resolution of the directors authorizing such notice (the correctness of which copy shall be certified to by the president, or the cashier, or treasurer of such bank or trust company) at the time that such bank or trust company shall file with the said Commissioner the statement required by section 4 of this Act. Such bank or trust company shall have no right to withdraw or revoke the said notice for the year in which it was filed as aforesaid, but may withdraw or revoke such notice as to any subsequent year provided that it file with the State Bank Commissioner on or before the first day of July of such subsequent year a copy of a resolution of its directors (certified to as aforesaid) withdrawing or revoking its aforesaid notice, and until the filing of such a copy of a resolution of withdrawal, the said notice shall be deemed to be binding upon said bank or trust company.

After the filing of a resolution as aforesaid with the State Bank Commissioner, he shall not assess or levy a tax against any of the shares of the stock of the bank or trust company filing such resolution until after the filing of a copy of a resolution of withdrawal as aforesaid.

Section 9. In case of neglect, refusal or failure on the part of any bank or trust company to comply with the provisions of this Act, with reference to the filing of the statements herein required to be made, on or before the time herein provided for the filing of the same, or to submit to the inspection of the State Bank Commissioner, or his deputy, or clerk, the list or statement herein required to be kept in the office of such company and submitted to inspection, the company so neglecting, refusing or failing shall be liable to a penalty of one hundred dollars and an additional sum of twenty-five dollars for each day during which such neglect, refusal or failure continues; which penalty shall be collected by the State Bank Commissioner in the name of the State of Delaware in the same manner as provided in the preceding section.

Section 10. Taxes imposed under this Act shall be due and payable on or before the first day of October in the year in which they are assessed, and after said date shall be collected by the State Bank Commissioner (together with a penalty of one per centum for each month or fraction of a month that the same shall remain unpaid after said date) by public sale of the stock affected to be made by the State Bank Commissioner at the principal place of business of such bank or trust company in this State, after giving the stockholder affected thirty days' notice of the amount of such tax and penalty and the time and place of sale, such notice to be by registered letter addressed to the stockholder at his post office address, as the same appears on the statement filed with the said Commissioner. The said Bank Commissioner shall also have the right to require any bank or trust company to withhold the payment of dividends to the stockholder affected and to pay such dividends, or so much thereof as may be necessary, to the said Commissioner in payment of the said tax and penalty.

Section 11. All moneys collected or received under this Act shall be the moneys of the State of Delaware, and it shall be the duty of the State Bank Commissioner to settle for the same with the Auditor of Accounts and to pay all amounts so collected and received to the State Treasurer forthwith.

Section 12. It shall be the duty of the Attorney General to act as the legal representative of the State of Delaware in all actions or proceedings had under this Act, and to render legal assistance to the State Bank Commissioner in executing the provisions hereof.

Section 13. Nothing in this Act shall be deemed or held to repeal, alter or modify any other statute, -or any provision of any other statute relative to taxation.

Approved March 31, A. D. 1921.