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Reply Brief Of The Petitioners-Taxpayers Edward A. And Doris Zelinsky, Edward A. Zelinsky

Amicus Briefs

The Division’s Brief confirms that the Tribunal should rule for the taxpayers, Edward A. and Doris Zelinsky Perhaps most egregiously, the Division disparages binding factual stipulations to which the parties agreed at the outset of this litigation. These stipulations confirm that, from March 15, 2020 through December 31, 2020 (“the COVID period”), Professor Zelinsky had no New York office or classroom available to him. Consequently, Professor Zelinsky taught his classes and met with students exclusively on zoom from his Connecticut home. He did not step foot in New York for this nine and one-half month period.

The stipulated facts lead …

Brief Of Amici Curiae Tax Law Professors, Young Ran (Christine) Kim

Amicus Briefs

Professors Reuven S. Avi-Yonah, David Gamage, Orly Mazur, Young Ran (Christine) Kim, and Darien Shanske (collectively, “Tax Law Professors”) write this amici curiae brief in support of the Appellant in COMPTROLLER OF MARYLAND v. COMCAST — the Maryland Digital Advertising Case.

Many digital transactions currently evade sales taxation in Maryland, even though the closest non-digital analogues are subject to tax. Specifically, digital advertising platforms like Respondents obtain vast quantities of individualized data from and on Marylanders in currently untaxed transactions. The scope and value of these transactions is vast and growing, as they allow advertising platforms the lucrative opportunity to …

Ending The Economic War Among States, Nathan Altstadt

Cleveland State Law Review

The United States is under siege; however, the cause is not a foreign adversary. Rather, infighting among states to attract and retain big businesses is jeopardizing the Nation’s economic prosperity.

States compete for businesses, using tax incentives, hoping to capitalize on the benefits these businesses represent. Benefits include improved job growth numbers, a future increase in tax revenue, or, simply, elevated political clout. While competition can lead to a more efficient use of resources, unregulated competition between states for businesses does not illustrate this theory. A national auction for a business, where states are blind to rival offers, may, and …

Pub. L. No. 86-272 And The Anti-Commandeering Doctrine: Is This Anachronism Constitutionally Vulnerable After Murphy V. Ncaa?, Matthew A. Melone

Michigan Business & Entrepreneurial Law Review

State taxing authority suffers from little of the structural impediments that the Constitution imposes on the federal government’s taxing power but the states’ power to tax is subject to the restrictions imposed on the exercise of any state action by the Constitution. The most significant obstacles to the states’ assertion of their taxing authority have been the Due Process Clause and the Commerce Clause. The Due Process Clause concerns itself with fairness while the Commerce Clause concerns itself with a functioning national economy. Although the two restrictions have different objectives, for quite some time both restrictions shared one attribute—a taxpayer …

Physical Presence Is In No Wayfair!: Addressing The Supreme Court’S Removal Of The Physical Presence Rule And The Need For Congressional Action, Claire Shook

Dickinson Law Review (2017-Present)

The Commerce Clause of Article I grants Congress the power to regulate commerce. In the past, an entity had to have a physical presence in a state for that state to impose taxes on the entity. Due to the changing landscape of online businesses, the U.S. Supreme Court decided in South Dakota v. Wayfair in June 2018 to remove the physical presence rule as it applied to the Commerce Clause analysis of state taxation. The Wayfair decision’s ramification is that states can now impose taxes on businesses conducting sales online without having any physical presence in those states. While the …

Hb 61 - Revenue And Taxation, Taylor N. Armstrong, Caitlin E. Correa

Georgia State University Law Review

The Act amends Georgia’s sales tax statute to shift the burden for the collection of sales taxes on online sales from the purchaser to the retailer.

Full Faith And Credit, Choice Of Laws, And Extraterritorial Regulation Of Corporate Transactions, Gregory S. Sergienko

Greg Sergienko

In a federal system in which each state may enact laws providing for the chartering and governance of corporations and in which corporations can and do conduct business in more than one state, several states may claim an interest in regulating the conduct of a given corporation. The enactment of state laws that are intended to restrict hostile corporate takeovers and that purport to extend to foreign corporations is one example of this phenomenon. "Typically, any of a number of jurisdictional links might trigger the application of such an anti-takeover statute: the target's being incorporated in the state, its having …

A Unifying Approach To Nexus Under The Dormant Commerce Clause, Adam B. Thimmesch

Michigan Law Review Online

The Supreme Court has long debated the existence and scope of its power to restrict state regulation under the so-called negative or dormant Commerce Clause. The Court took a broad view of that power in the late 1800s, but it has refined and restricted its role over time. One area where the Court has continued to wield considerable power, however, has been in the context of state taxes. Specifically, the Court has continued to restrict states' power to compel out-of-state vendors to collect their sales and use taxes based on a physical-presence "nexus" rule. That rule dates back to the …

Questioning Quill, Hayes R. Holderness

Law Faculty Publications

The physical presence rule of Quill Corp. v. North Dakota is under increasing attack from the “Kill Quill” movement — a consortium of state tax administrators, industry leaders, and academics opposed to the decision. The physical presence rule prohibits states from requiring many out-of-state vendors to collect taxes on goods sold into the states. Kill Quill states have grown increasingly aggressive, and litigation is well underway in South Dakota and Alabama over those states’ direct disregard for the rule. As a petition to the Supreme Court for certiorari grows closer, the case for overturning the physical presence rule remains cloudy. …

Nfib V. Sebelius And The Individual Mandate: Thoughts On The Tax/Regulation Distinction, Kyle D. Logue

Michigan Business & Entrepreneurial Law Review

When Chief Justice John Roberts wrote the opinion of the Court in National Federation of Independent Businesses v. Sebelius (NFIB) explaining the constitutionality of the Affordable Care Act’s (ACA) minimum essential coverage provision (sometimes referred to as the individual mandate), he reasoned that the mandate—or, more precisely, the enforcement provision that accompanied the mandate (the Shared Responsibility Payment or SRP)—could be understood as a tax on the failure to purchase health insurance. According to this view, the enactment of the mandate and its accompanying enforcement provisions fell within Congress’s virtually unlimited power to “lay and collect taxes.” This tax-based interpretation …

The Internet Tax Freedom Act: Necessary Protection Or Deferral Of The Problem?, Timothy Fallaw

Journal of Intellectual Property Law

No abstract provided.

Putting The Commerce Back In The Dormant Commerce Clause: State Taxes, State Subsidies, And Commerce Neutrality, Ryan Lirette, Alan D. Viard

Journal of Law and Policy

The unpredictability of the Supreme Court’s dormant Commerce Clause (“DCC”) jurisprudence continues to draw trenchant criticism from commentators and the Justices themselves, as the Court remains unable to explain which state taxes and subsidies impede interstate commerce. We show that these problems can be resolved by a Commerce Neutrality framework requiring that state taxes and subsidies provide a combined treatment of inbound and outbound transactions at least as favorable as their treatment of intrastate transactions. This simple test has an economic foundation because taxes and subsidies that violate it create incentives to engage in intrastate rather than interstate transactions. The …

King V. Burwell And The Rise Of The Administrative State, Ronald D. Rotunda

Ronald D. Rotunda

The Patient Protection and Affordable Care Act (ACA) is a complex law totaling nearly a thousand pages in length. The litigation now before the Supreme Court in King v. Burwell presents, on the surface, a simple issue of statutory interpretation. However, that surface has a very thin veneer. If the Court allows administrators carte blanche to change the very words of a statute, we will have come a long way towards governance by bureaucrats. Over the years, Congress has delegated many of its powers, but it has never delegated the power to raise taxes or spend tax subsidies in ways …

Taxpayer Standing And Daimlerchrysler V. Cuno: Where Do We Go From Here?, Kristin E. Hickman, Donald B. Tobin

Donald B. Tobin

In granting certiorari in the case of Daimler-Chrysler Corp. v. Cuno, the Supreme Court asked the parties to brief "whether respondents have standing to challenge Ohio's investment tax credit." This report applies modern standing doctrine to the Cuno case and concludes that the Cuno plaintiffs do no have standing to raise their claims in federal court. Moreover, the authors write, allowing the Cuno plaintiffs' case to be resolved in federal court would open the federal court system to a wide range of taxpayer challenges better left to the political branches of government. Nevertheless, they recognize that there may be other …

Federalism And Phantom Economic Rights In Nfib V. Sibelius, Matthew Lindsay

All Faculty Scholarship

Few predicted that the constitutional fate of the Patient Protection and Affordable Care Act would turn on Congress’ power to lay and collect taxes. Yet in NFIB v. Sebelius, the Supreme Court upheld the centerpiece of the Act — the minimum coverage provision (MCP), commonly known as the “individual mandate” — as a tax. The unexpected basis of the Court’s holding has deflected attention from what may prove to be the decision’s more constitutionally consequential feature: that a majority of the Court agreed that Congress lacked authority under the Commerce Clause to penalize people who decline to purchase health insurance. …

Chief Justice Roberts' Individual Mandate: The Lawless Medicine Of Nfib V. Sebelius, Gregory Magarian

Gregory P. Magarian

After the U.S. Supreme Court in National Federation of Independent Business v. Sebelius held nearly all of the Patient Protection and Affordable Care Act constitutional, praise rained down on Chief Justice John Roberts. The Chief Justice’s lead opinion broke with his usual conservative allies on the Court by upholding the Act’s individual mandate under the Taxing Clause. Numerous academic and popular commentators have lauded the Chief Justice for his political courage and institutional pragmatism. In this essay, Professor Magarian challenges the heroic narrative surrounding the Chief Justice’s opinion. The essay contends that the opinion is, in two distinct senses, fundamentally …

No Small Feat: Who Won The Health Care Case (And Why Did So Many Law Professors Miss The Boat)?, Randy E. Barnett

Georgetown Law Faculty Publications and Other Works

In this essay, prepared as the basis for the 2013 Dunwody Distinguished Lecture in Law at the Fredric G. Levin College of Law, University of Florida, I describe five aspects of the Supreme Court’s decision in NFIB v. Sebelius that are sometimes overlooked or misunderstood. (1) The Court held that imposing economic mandates on the people was unconstitutional under the Commerce and Necessary and Proper Clauses; (2) Whether viewed from a formalist or realist perspective, Chief Justice Roberts’ reasoning was the holding in the case; (3) The Court did not uphold the constitutionality of the individual insurance mandate under the …

So Much For The Commerce Clause Challenge To Individual Mandate Being "Frivolous", Randy E. Barnett

Georgetown Law Faculty Publications and Other Works

Remember when the Commerce Clause challenge to the individual insurance mandate was dismissed by all serious and knowledgeable constitutional law professors and Nancy Pelosi as "frivolous"? Well, as Jonathan notes, the administration is now apparently telling the New York Times that the individual insurance "requirement" and "penalty" is really an exercise of the Tax Power of Congress.

The Post-Cuno Litigation Landscape, Morgan Holcomb, Nicholas Allen Smith

Faculty Scholarship

In 1996, Northeastern University School of Law Professor Peter Enrich wrote a groundbreaking article, in which he argued that certain state tax incentives are unconstitutional as violations of the Commerce Clause. This article begins by describing the constitutional landscape into which Enrich cast his argument, and them turns describe the litigation that Enrich’s article has generated, including the much-watched case, Cuno v. DaimlerChrysler Corp., which held the promise of resolving this dormant Commerce Clause question, only to wither away on the vine of standing. Following the discussion of Cuno, this article will turn to an exploration of the litigation that …

Is "Internal Consistency" Dead?: Reflections On An Evolving Commerce Clause Restraint On State Taxation, Walter Hellerstein

Scholarly Works

Under the "internal consistency" doctrine articulated by the U.S. Supreme Court under the dormant Commerce Clause, a state tax must be structured so that if every state were to impose an identical tax, interstate commerce would fare no worse than intrastate commerce. Although a relatively recent addition to the Court's Commerce Clause jurisprudence, the doctrine has played a significant role as the basis for the judicial invalidation of a wide array of state and local taxes. In American Trucking Associations, Inc., v. Michigan Public Service Commission, 545 U.S. 429 (2005), however, the Court sustained an admittedly "internally inconsistent" $100 per …

Preface To Comparative Fiscal Federalism: Comparing The European Court Of Justice And The Us Supreme Court's Tax Jurisprudence, Reuven S. Avi-Yonah

Other Publications

In October 2005, a group of distinguished tax experts from both the European Union and the United States convened at the University of Michigan Law School for a conference on 'Comparative Fiscal Federalism: Comparing the US Supreme Court and European Court of Justice Tax Jurisprudence.' The conference was sponsored by the Law School, the European Union Center, and Harvard Law School's Fund for Tax and Fiscal Research. Attendees from Europe included Michel Au jean, the principal tax official at the EU Commission, Servaas van Thiel, chief tax advisor to the EU Council, Michael Lang (Vienna) and Kees van Raad (Leiden), …

Taxpayer Standing And Daimlerchrysler V. Cuno: Where Do We Go From Here?, Kristin E. Hickman, Donald B. Tobin

Faculty Scholarship

In granting certiorari in the case of Daimler-Chrysler Corp. v. Cuno, the Supreme Court asked the parties to brief "whether respondents have standing to challenge Ohio's investment tax credit." This report applies modern standing doctrine to the Cuno case and concludes that the Cuno plaintiffs do no have standing to raise their claims in federal court. Moreover, the authors write, allowing the Cuno plaintiffs' case to be resolved in federal court would open the federal court system to a wide range of taxpayer challenges better left to the political branches of government. Nevertheless, they recognize that there may be …

Separate But Taxed: A Rejection Of The Steamlined Sales Tax Project Through A Commerce Clause And Federalist Analysis, Gregory R. Evans

American University Law Review

Sales and use taxes, which are levied by forty-five states, have long been an important source of revenue for state and local governments. The rigid structure of these long-standing taxes, however, has been strained by the rapid evolution of the online economy. As a result, the Multistate Tax Commission (“MTC”) devised a plan, the Streamlined State Sales Tax Project (“STP”), to recapture some of the revenue that state and local governments might otherwise lose as consumer purchases migrate from local retailers to online sellers. This plan, approved reciprocally by the states, but not by Congress, was designed by state legislators …

The Rush To The Goblin Market: The Blurring Of Quill'S Two Nexus Tests, H. Beau Baez Iii

Seattle University Law Review

Part II of this Article begins with a brief introduction to sales and use taxes in the United States. Although these taxes are complementary in nature, they are treated differently for constitutional purposes. This Part then examines the Due Process Clause and Commerce Clause constraints on state taxation, which are animated by very different concerns. Next, this Part explores footnote eight in Quill to dispel the notion that Quill established a facts-and-circumstances test. The section concludes by discussing the problems lower courts have had in applying the Quill nexus tests. The primary problem encountered by the lower courts, exemplified by …

Federal Constitutional Restraints On Tax Competition Among The American States, Walter Hellerstein

Scholarly Works

This article examines the judicially developed rules limiting interstate tax competition in the United States and the constitutional framework out of which they arise.

Will Surfing The Web Subject One To Transient Tax Jurisdiction? Why We Need A Uniform Federal Sales Tax On Internet Commerce, Aaron G. Murphy

Seattle University Law Review

This Comment considers how Internet sales could be taxed if Congressional action is taken to remove the Commerce Clause impediments, which would leave only Due Process Clause limitations on Internet taxation. Though three potential solutions are addressed and analyzed for their potential treatment under the Due Process Clause, this Comment concludes that a federal uniform tax on Internet sales of goods will achieve the best balance of interests while avoiding Due Process problems. Part Two provides the reader with a basic description of the current law in the area of sales and use taxes and the problems the Internet poses …

Commerce Clause Restraints On State Tax Incentives, Walter Hellerstein

Scholarly Works

The states' provision of tax incentives designed to encourage economic development within their borders has long been a feature of the American legislative landscape. Today every state provides tax incentives as an inducement to local industrial location and expansion. Indeed, scarcely a day goes by without some state offering yet another tax incentive to spur economic development, often in an effort to attract a particular enterprise to the state.

The debate over the efficacy and wisdom of state tax and other business incentives is intense and important, as other articles in this Symposium plainly reveal. My purpose here, however, is …

Protecting Tribal Sovereignty: Why States Should Not Be Able To Tax Contractors Hired By The Bia To Construct Reservation Projects For Tribes: Blaze Construction Co. V. New Mexico Taxation And Revenue Department: A Case Study, Richard J. Ansson Jr.

American Indian Law Review

No abstract provided.

Commerce Clause Restraints On State Taxation After Jefferson Lines, Walter Hellerstein, Michael J. Mcintyre, Richard D. Pomp

Scholarly Works

The Supreme Court's 1977 decision in Complete Auto Transit, Inc. v. Brady signaled a paradigmatic shift in the Court's approach to state tax adjudication under the dormant Commerce Clause. In Complete Auto, the Court repudiated the formalistic school of interpretation that once had governed Commerce Clause analysis of state taxation because it bore ‘no relationship to economic realities.’ In its place, the Court embraced a decisional framework that ‘considered not the formal language of the tax statute but rather its practical effect.’ In furtherance of this objective, the Court suggested a four-part test to guide the constitutional analysis of state …

Justice Scalia And The Commerce Clause: Reflections Of A State Tax Lawyer, Walter Hellerstein

Scholarly Works

This paper considers Justice Scalia's substantive views of the restraints that the commerce clause imposes on state taxation. My purpose is to examine critically Justice Scalia's dormant or "negative" commerce clause analysis of the state tax issues on which he has opined and to draw from that examination some general conclusions about Justice Scalia's commerce clause jurisprudence.