Federal Constitutional Law

Key Concepts:

Terms in this set (22)

The same general consideration that apply to state regulation of commerce apply to state taxation of commerce.

- General considerations: Congress has complete power to authorize or forbid state tax that affects interstate commerce.

- Uses taxes: use taxes are imposed on goods purchased outside the state but used w/in it. They are valid. An interstate seller can be required to collect a use tax IF the seller has a sufficient nexus with the taxing state (e.g., maintains offices in taxing state). Merely soliciting orders by mail and shipping orders into the state is not sufficient.

- Sales Tax: taxes imposed on the seller of goods for sales consummated w/in the state. Generally do not discriminate against interstate commerce; rather, the issue usually involved whether there is a substantial nexus between the taxpayer and taxing state or whether the tax is properly apportioned.

- Ad valorem property taxes: taxes based on assessed value of property in question.

- Privilege, license, franchise, or occupational taxes: so-called "doing business" taxes are generally permitted. Such taxes may be measured by flat amount or by promotional rate based on K w/ taxing state. In either case, basic requirements must be met: (1) activity taxed must have substantial nexus to taxing state; (2) tax must be fairly apportioned; (3) tax must not discriminate against interstate commerce; and (4) tax must fail relate to services provided by the state.

- Powers of states to tax foreign commerce: import-export clause and the commerce clause greatly limit the states' power to tax foreign commerce.