DIRECT TAXATION. 
237 
direct tax within the meaning of sect. 92, subsect. 2, nor a 
license within the meaning of subsect. 9. This view was 
taken by the Canadian Court, and was upheld by the Privy 
Council. Stress was laid on the fact that the Act did not 
require any payment to be made for the license, nor did it 
impose any penalty for not taking out the license—the 
penalty being incurred only if a policy was issued without 
the stamp. The Act was therefore a Stamp Act, and not a 
Licensing Act. Being a Stamp Act it was a method of 
indirect and not of direct taxation. 
On the other hand a duty or stamp on exhibits filed in a 
Court in an action is an indirect tax, as the litigant, who in 
the first instance pays it, is not necessarily the person on 
whom the burden may ultimately fall. 
In a more recent case® the Judicial Committee held Taxes on 
that a Quebec Act imposing a tax on banks and insurance 
companies, varying in the case of banks in proportion to paid- 
up capital, and based in the case of insurance companies on a 
sum specified in the Act, was valid, on the ground that looking 
at the Act in question it was evident that it was the intention 
of the Legislature that the corporations from whom the tax 
was demanded should pay and finally bear it. Mill's definition 
was taken as a fair test of a direct tax, viz. “a direct tax is 
one which is demanded from the very persons who if is 
intended or desired should pay it. Indirect taxes are those 
which are demanded from one person in the expectation and 
intention that he shall indemnify himself at the expense of 
another.” It was also held in the same case that a province 
may levy a tax on a business in the province though some 
of the persons on whom the tax would fall were domiciled 
elsewhere, as sect. 92 (2) did not require the persons faxed to 
he domiciled in the province. 
A. G. of Quebec v. Reed, 10 App. Cas. 141. 
: Bank of Toronto v. Lambe, Li. R. 12 App. Cas. 575.