Tax Law Commons^™

Constitutional Restraints On Intrastate Distribution Of Taxing Authority, Walter Hellerstein

Scholarly Works

No abstract provided.

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

Journal of Intellectual Property Law

No abstract provided.

Multistate Export Trade Promotion Under The Export Trading Company Act Of 1982, Joseph M. Gannam

Georgia Journal of International & Comparative Law

No abstract provided.

Fiscal Federalism In The United States, Walter Hellerstein

Presentations and Speeches

This presentation explores the fiscal powers of U.S. Federal and State governments with respect to taxation and spending.

Reconstructing The Individual Mandate As An Escrow Account, Gregg Polsky

Scholarly Works

This short essay in Michigan Law Review First Impressions describes how the individual mandate could be reconstructed as an escrow account. Such a restructuring would ameliorate policy concerns regarding the mandate while still deterring the opportunistic behavior that would otherwise occur as a result of the nondiscrimination rules imposed on insurers.

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 …

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.

Regulating Section 527 Organizations, Gregg D. Polsky, Guy-Uriel E. Charles

Scholarly Works

In this Essay, we consider whether the Federal Election Commission (FEC) has the authority to regulate independent 527 organizations (e.g., Swiftboat Veterans for Truth, Moveon.org, etc.) as political committees under the Federal Election Campaign Act. This issue, which was hotly debated during the last election cycle when it was considered and ultimately tabled by the FEC, is an extremely complex one that requires a deep understanding of election, tax, administrative, and constitutional law. After considering how these areas of law intersect, we conclude that the FEC lacks the authority to regulate independent 527 organizations as political committees.

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 …

Suspect Linkage: The Interplay Of State Taxing And Spending Measures In The Application Of Constitutional Antidiscrimination Rules, Dan T. Coenen, Walter Hellerstein

Scholarly Works

This article examines an important and recurring question that courts frequently resolve, but rarely analyze: whether taxing and spending measures should be viewed together when a state imposes a nondiscriminatory tax but also affords relief to some taxpayers through government spending. The answer to this question will often determine whether the state's actions violate constitutional strictures against discriminatory taxation. The taxing measure and the spending measure will generally pass muster if viewed in isolation. After all, courts rarely invalidate nondiscriminatory taxing measures on constitutional grounds. And true government spending measures, if considered alone, plainly fall outside the reach of constitutional …

Suspect Linkage: The Interplay Of State Taxing And Spending Measures In The Application Of Constitutional Antidiscrimination Rules, Dan T. Coenen, Walter Hellerstein

Scholarly Works

This article examines an important and recurring question that courts frequently resolve, but rarely analyze: whether taxing and spending measures should be viewed together when a state imposes a nondiscriminatory tax but also affords relief to some taxpayers through government spending. the answer to this question will often determine whether the state's actions violate constitutional strictures against discriminatory taxation. The taxing measure and the spending measure will generally pass muster if viewed in isolation. After all, courts rarely invalidate nondiscriminatory taxing measures on constitutional grounds. And true government spending measures, if considered alone, plainly fall outside the reach of constitutional …

Commerce Clause Restraints On State Business Development Incentives, Walter Hellerstein, Dan T. Coenen

Scholarly Works

In this Article, we explore the ill-defined distinction between the constitutional carrot and the unconstitutional stick in state tax, subsidy, and related cases. Part I examines the restraints that the Commerce Clause imposes on state tax incentives. It canvasses the general principles limiting discriminatory state taxation, explores the Court's decisions addressing state tax incentives, and proposes a framework of analysis for adjudicating the validity of such incentives. Part I concludes by considering the constitutionality of a variety of state tax incentives within our suggested framework and also under alternative approaches that courts might utilize. Part II examines the restraints that …

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 …

West Lynn Creamery And The Constitutionality Of State Tax Incentives, Walter Hellerstein

Scholarly Works

One of the more perplexing questions that has surfaced from time to time in the state tax field is how a constitutionally benign tax incentive program designed to attract industry to a state is to be distinguished from an unconstitutionally discriminatory taxing scheme that “forecloses tax-neutral decisions” and “provides a direct commercial advantage to local business.” On one hand, the U.S. Supreme Court has expressed the view that its decisions do “not prevent the States from structuring their tax systems to encourage the growth and development of intrastate commerce and industry.” On the other hand, the Court has frequently invalidated …

State Taxation Of Corporate Income From Intangibles: Allied-Signal And Beyond, Walter Hellerstein

Scholarly Works

If the field of state taxation has become somewhat of an academic backwater, it is not for want of issues warranting sustained scholarly attention. The Supreme Court alone has provided ample grist for the academic mill by handing down an extraordinary number of significant decisions delineating the federal constitutional restraints on state tax power. Among the state tax questions considered by the Court in recent years, none has figured so prominently and persistently in its deliberations as the states' power to tax the income of multijurisdictional corporations. In Allied-Signal, Inc. v. Director, Division of Taxation, the Court revisited the most …

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.

Preliminary Reflections On Mckesson And American Trucking Associations, Walter Hellerstein

Scholarly Works

On June 4, 1990, the Supreme Court issued its long awaited decisions in McKesson Corp v. Division of Alcoholic Beverages and Tobacco and American Trucking Associations, Inc. v. Smith. Both cases raised the question of whether a taxpayer has a right to a refund of unconstitutional state taxes. This article analyzes these decisions separately and considers the implications of these decisions on future state tax litigation. The article has two purposes: first, to analyze the McKesson and American Trucking Association cases; and second, to consider their implications for future constitutional challenges to state taxes. The article concludes by stating …

State Taxation And The Supreme Court, Walter Hellerstein

Scholarly Works

The Supreme Court's outpouring of significant state tax decisions in recent years has elicited little more than a yawn from most constitutional scholars. The nation's preeminent law reviews, which once were filled with articles examining the Court's state tax opinions, pay scant attention to them today. Leading constitutional law casebooks make only passing reference to state taxation. Indeed, the Court itself has expressed ennui over the prospect of adjudicating a seemingly endless stream of state tax controversies. The lack of academic interest in the Court's state tax jurisprudence may be attributable to several factors. Matters of greater cosmic significance -- …

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

Scholarly Works

Before 1983, the Supreme Court had never uttered the phrase "internal consistency" in a state tax opinion. Since 1983, however, the Court has invoked the principle of "internal consistency" on four separate occasions in adjudicating the validity of state taxes under the commerce clause. Indeed, by 1987, the Court could refer almost casually to the "internal consistency" criterion as "the test ... we have applied in other contexts." The Court's talk of "internal consistency" cannot be dismissed as mere rhetoric. Three of the four taxes that have been put to the "internal consistency" test have flunked it; cases approving taxes …

Commerce Clause Restraints On State Taxation: Purposeful Economic Protectionism And Beyond, Walter Hellerstein

Scholarly Works

Few questions in recent years have spawned as much controversy and as little academic interest as the scope of commerce clause restraints on state tax power. The Supreme Court has handed down an extraordinary number of significant decisions addressed to the limitations the commerce clause imposes on state taxation. Yet these decisions have barely caught the eye of the nation's leading law reviews or constitutional scholars. Even those observers who have recognized the Court's renaissance of interest in the dormant commerce clause have largely confined their attention to state regulation, as distinguished from state taxation, of interstate commerce. If there …

Legal Perspectives On The Interstate Incidence And Shifting Of State And Local Taxes, Walter Hellerstein

Scholarly Works

Lawyers, especially constitutional lawyers, have long been concerned with the problems associated with the interstate incidence and shifting of state and local taxes. The Constitution has frequently been invoked as a restraint on the states' power to levy taxes on persons, property, or activities outside their borders. Yet the lawyer's view of tax incidence embodied in these constitutional disputes often bears little resemblance to the economist's. In recent years, however, lawyers have sought to import economic concepts of shifting and incidence into the legal analysis of the constitutional limitations on the states' power to export tax burdens to residents of …

State Income Taxation Of Multijurisdictional Corporations, Part Ii: Reflections On Asarco And Woolworth, Walter Hellerstein

Scholarly Works

The first part of this Article, State Income Taxation of Multiurisdictional Corporations: Reflections on Mobil, Exxon, and H A 5076, did not contemplate a sequel. The Supreme Court's decisions last term in two state corporate income tax cases, however, created an irresistible opportunity to write one. The Court's opinions in ASARC0 and Woolworth picked up where its opinions in Mobil and Exxon left off. Yet the direction taken by these more recent decisions veers sharply from the course ostensibly set by their predecessors. This Article will consider the Court's latest pronouncements in this area in a continuing if quixotic effort …

State Income Taxation Of Multijurisdictional Corporations: Reflections On Mobil, Exxon, And H.R. 5076, Walter Hellerstein

Scholarly Works

The state tax field is enjoying a renaissance of sorts. The Supreme Court has displayed a renewed interest in the area, handing down an unusual number of significant decisions addressed to the constitutional restraints on state tax power. State courts have exhibited a similar revival of interest in these problems through an out-pouring of uncharacteristically thoughtful opinions concerning state taxation of multistate and multinational enterprise. Congress, whose concern with state taxation of interstate and foreign commerce has been sporadic, is again considering legislation that would limit state taxing authority in these domains.

Even the executive branch, which seldom intervenes in …

Hughes V. Oklahoma: The Court, The Commerce Clause, And State Control Of Natural Resources, Walter Hellerstein

Scholarly Works

The Supreme Court's recent Commerce Clause opinions reflect an apparent effort to rationalize and modernize the analytical framework for delineating the implied restraints that the Clause imposes on state legislation. In the state tax field, the Court has articulated a coherent set of criteria controlling the validity of state taxes on interstate commerce and has discarded doctrine inconsistent with these standards. In the state regulatory context, the Court has likewise enunciated meaningful decisional principles governing the constitutionality of state regulations affecting interstate commerce and has applied them without substantial concern for their impact on its precedents of an earlier era. …

State Taxation And The Supreme Court: Toward A More Unified Approach To Constitutional Adjudication?, Walter Hellerstein

Scholarly Works

The Supreme Court's decisions delineating the constitutional limitations on state tax power have often defied rational analysis. The Court read the commerce clause as forbidding a state tax on the privilege of doing interstate business but not on the privilege of doing interstate business in corporate form. It construed the import-export clause as prohibiting a state tax on bales of imported hemp awaiting use in manufacturing but not on piles of imported ore and plywood awaiting such use. It interpreted the supremacy clause as barring a state tax upon the sale of goods to one government contractor but not to …

State Taxation And The Supreme Court: Toward A More Unified Approach To Constitutional Adjudication?, Walter Hellerstein

Scholarly Works

The Supreme Court's decisions delineating the constitutional limitations on state tax power have often defied rational analysis. The Court read the commerce clause as forbidding a state tax on the privilege of doing interstate business but not on the privilege of doing interstate business in corporate form. It construed the import-export clause as prohibiting a state tax on bales of imported hemp awaiting use in manufacturing but not on piles of imported ore and plywood awaiting such use. It interpreted the supremacy clause as barring a state tax upon the sale of goods to one government contractor but not to …

Some Reflections On The State Taxation Of A Nonresident's Personal Income, Walter Hellerstein

Scholarly Works

With respect to the taxation of personal income, it was plain by 1940 that states were constitutionally free to tax residents on all personal income wherever earned and nonresidents on personal income earned within the state, even though these two principles, taken together, meant that an individual's income might be subject to double-taxation by different states. The Supreme Court, after toying with the idea for a decade, finally rejected the invitation to forge the due process clause into a tool for preventing multiple taxation and reverted to the ruling law of an earlier era that left the solution of such …