Upgrade to remove ads
TAXING INTERSTATE COMMERCE
Terms in this set (4)
NON DISCRININATORY TAXATION
In the absence of relevant federal legislation the court reviews nondiscrimatory state tases affecting interstate commerce under the commerce clause and due process clause -
balancing the state's need to obtain revenue agains the burden of taxes imposed on the free fow of commerce.
Will prevent state taxes that impose multiple burdens on interstate commerce
DUE PROCESS CLAUSE
The principal focus is jurisdiction. It is mainly used to require that the benefits and protection afforded by the taxing state have a sufficient relationship to the subject matter taxed so that the subject matter has a tax situs in the tasing state.
AD VALOREM PROPERTY TAX
Taxes based on the value of the property being taxed. Criteria is based upon, taxable situs and apportionment.
A property has a taxable situs in a state if it receivesbenefits or protection from the state (airplanes establish a taxable situs in states where they land on a regular basis, even using different aircraft).
If an instrumentality of commerce has more than one taxable situs, a fair apportionment of its value to the taxing state is required.
1-Using the proportion of miles traveled within the taxing state to the total number of mies traveled by the instrumentalities in its entire operation
2-Computing the average number of instrumentalities physically present in the taxing state on any one day during the tax year and taxing that portion at full value (tank cars)
The apportionment formula used must be rational both on its face and as applied.
TAX ON CARGO IN TRANSIT
States cannot levy an ad valorem tax on peroprty being shipped interstate that happens to be in the taxing stat on tax day.
BEGINNING OF INTERSTATE CARGO TRAVEL
The cargo is delivered to an interstate carrier and thus begins transit
Temporary interrutions for the convenience of transportation do not destroy the interstate nature of the shipment
DOING BUSINESS TAXES
Taxes imposed for doing businesswithin the state requires a four part test.
FOUR PART TEST
1-The activity taxed must ahve a substantial nexus to the taxing state
2-The tax must be fairly apportioned
3-The tax must not discriminate agains interstate commerce, and
4-The tax must fairly relate to services provided
OTHER SETS BY THIS CREATOR
GIFTS OF PERSONAL PROPERTY
OTHER QUIZLET SETS
Ch. 14 Vocab ( Gov)
Ch 14 Gov
AP NSL CH 14
ACCT 4611 Final Exam - Short Answer Questions