State and Local Taxation : Cases and Materials

by Hellerstein, Jerome R.

• ISBN13: 9780314153760
• ISBN10: 0314153764
• Edition: 8th
• Format: Hardcover
• Copyright: 2005-06-08
• Publisher: West Group

Summary

This law school casebook contains the most recent cases dealing with such issues as jurisdiction to tax out-of-state corporations, taxation of electric-power generating capacity and contaminated property, use tax collection responsibilities, and multiple and discriminatory taxation of nonresidents. In addition, this edition focuses on the rapidly expanding issues raised by state taxation of electronic commerce. It also includes the latest U.S. Supreme Court cases of general significance, as well as a section devoted to fundamental sales tax reform reflected in the states? Streamlined Sales Tax Project.

Table of Contents

Preface	v
Table of Cases	xxi
The Development of The American State and Local Tax System	1	(18)
Colonial Taxation	1	(1)
The Growth of State Taxation	2	(5)
The Development of the Local Tax System	7	(1)
Trends in Local Revenue Yields	8	(2)
The Growth of Local Non-Property Taxes	10	(2)
Current State and Local Taxes	12	(2)
Comments and Notes to Table 6	14	(3)
Bibliographical Note	17	(2)
Preliminary Materials	19	(15)
Basic Elements in the Analysis of Taxes	19	(1)
Notes and Questions	20	(3)
Purposes of Taxation	23	(1)
Notes and Questions	24	(5)
The Canons of Taxation	29	(1)
Note on Statutory Construction	30	(4)
Uniformity and Equality Requirements of State and Federal Constitutions	34	(56)
State Uniformity and Equality Requirements	34	(17)
Introduction	34	(1)
Notes and Questions	35	(2)
Classification Problems Arising Under Uniformity and Equality Provisions	37	(1)
Douglas Aircraft Co., Inc. v. Johnson	37	(4)
Notes and Questions	41	(3)
Differences in Treatment of Taxpayers or Property Under Uniformity and Equality Clauses	44	(1)
In Re Opinion of the Justices	44	(3)
Notes and Questions	47	(4)
Equal Protection of the Laws	51	(33)
Classification of Property and Taxpayers	51	(1)
Fitzgerald v. Racing Association of Central Iowa	51	(3)
Notes and Questions	54	(11)
Separate Classification of Foreign and Domestic Corporations: The Insurance Company Cases	65	(1)
Metropolitan Life Insurance Company v. Ward	66	(10)
Notes and Questions	76	(3)
Separate Classification of Foreign and Domestic Corporations: The Non-Insurance Cases	79	(1)
Notes and Questions	79	(4)
Discrimination Against Nonresident Individuals	83	(1)
Notes and Questions	83	(1)
Privileges and Immunities	84	(6)
Introduction	84	(2)
The Privileges and Immunities Clause of Article IV, 2	86	(1)
Notes and Questions	86	(4)
Ad Valorem Property Taxes	90	(102)
Property Taxation and Property Rights	90	(12)
Power Resources Cooperative v. Department of Revenue	91	(5)
Notes and Questions	96	(1)
Assessing and Collecting the Tax	97	(1)
The Economic Debate Over the Incidence of the Property Tax	98	(4)
Uniformity and Equality in Assessment	102	(22)
Classification and Fractional Assessment	102	(2)
Judicial and Legislative Responses	104	(1)
People Ex Rel. Schlaeger v. Allyn	104	(5)
Notes and Questions	109	(1)
Hellerstein v. Assessor of Islip	109	(6)
Notes and Questions	115	(4)
Township of West Milford v. Van Decker	119	(4)
Notes and Questions	123	(1)
Approaches to the Valuation of Property	124	(68)
Methods of Valuing Property	125	(1)
Rosbroc Associates v. Assessor and Board of Review of the City of New Rochelle	126	(7)
Notes and Questions	133	(2)
Environmental Considerations	135	(1)
Westling v. County of Mille Lacs	135	(3)
Notes and Questions	138	(4)
Valuation At Highest and Best Use	142	(1)
Board Of Assessment Appeals v. Colorado Arlberg Club	142	(2)
Notes and Questions	144	(1)
Current Use Valuation as an Alternative to Highest and Best Use	145	(1)
Notes and Questions	146	(2)
Direct and Indirect Taxation of Intangibles	148	(1)
GTE Sprint Communications Corp. v. County of Alameda	149	(6)
Notes and Questions	155	(2)
Special Issues in the Comparable Sales Approach	157	(1)
Notes and Questions	158	(3)
Pepperidge Tree Realty Corp. v. Kinnelon	161	(5)
Notes and Questions	166	(1)
Special Problems in the Cost Approach	167	(1)
Joseph E. Seagram & Sons, Inc. v. Tax Commission of the City of New York	167	(4)
Joseph E. Seagram & Sons, Inc. v. Tax Commission of the City of New York	171	(1)
Notes and Questions	172	(1)
Special Problems in the Income Approach	173	(1)
Valuation of Property Subject to a Long-Term Lease	173	(1)
In The Matter of Merrick Holding Corp. v. Board of Assessors	173	(4)
Notes and Questions	177	(1)
Valuation of Property Subject to Other Legal Restrictions	178	(1)
Twin Lakes Golf and Country Club v. King County	179	(2)
Notes and Questions	181	(2)
Cottonwood Affordable Housing v. Yavapai County	183	(3)
Notes and Questions	186	(1)
Village of Ridgewood v. Bolger Foundation	186	(4)
Notes and Questions	190	(2)
Commerce Clause Restrictions on State and Local Taxation	192	(135)
A Survey of The U.S. Supreme Court's Changing Approaches to State Taxation of Interstate Business Under the Commerce Clause	193	(16)
Doctrinal Background	193	(2)
The Free Trade Approach to the Commerce Clause	195	(3)
The Development of the Multiple Taxation Doctrine	198	(3)
The Temporary Reversion to Earlier Doctrine	201	(1)
The New Ascendancy of State Taxing Powers: The Repudiation of Traditional Restrictive Commerce Clause Doctrine	201	(3)
The Court's Articulation of and Continued Adherence to the Four-Part Commerce Clause Test of Complete Auto	204	(1)
Justice Scalia's Commerce Clause Jurisprudence	205	(4)
Implementation of Commerce Clause Restrictions in the Decided Cases	209	(110)
The Scope of the Commerce Clause	209	(2)
Camps Newfound/Owatonna, Inc. v. Town of Harrison	211	(3)
Notes and Questions	214	(1)
Taxes Imposed on Net Income Derived From Interstate Business	215	(1)
Northwestern States Portland Cement Company v. State of Minnesota	215	(1)
T.V. Williams, As State Revenue Commissioner v. Stockham Valves and Fittings, Inc.	215	(12)
Notes and Questions	227	(1)
Taxes Imposed on the Privilege of Doing Business in the State	227	(1)
Complete Auto Transit, Inc. v. Brady	228	(9)
Notes and Questions	237	(2)
Gross Receipts Taxes	239	(1)
Tyler Pipe Industries, Inc. v. Washington State Department of Revenue	239	(2)
Notes and Questions	241	(5)
The Taxation of Interstate Sales and the Vendor's Duty to Collect Sales and Use Taxes	246	(1)
Taxation of Instrumentalities of Interstate Commerce	247	(1)
Goldberg v. Sweet	247	(9)
Notes and Questions	256	(6)
Levies Discriminating Against Interstate Commerce	262	(1)
Introductory Note	262	(3)
Halliburton Oil Well Cementing Co. v. Reily	265	(5)
Notes and Questions	270	(10)
Cuno v. Daimlerchrysler, Inc.	280	(8)
Notes and Questions	288	(2)
Severance Taxes	290	(1)
Commonwealth Edison Co. v. Montana	290	(12)
Notes and Questions	302	(1)
Highway Use Taxes and Other User Charges	303	(3)
Taxation of Intoxicating Liquors	306	(2)
Taxation of Foreign Commerce	308	(1)
Japan Line, Limited v. County of Los Angeles	308	(8)
Notes and Questions	316	(3)
The Role of Congress in Dealing With State Taxation of Interstate and Foreign Commerce	319	(8)
The Power of Congress Under the Commerce Clause to Contract and Expand State Tax Power	320	(1)
Notes and Questions	320	(3)
State Taxes That Conflict With or Frustrate Established Federal Policy	323	(2)
Congressional Legislation Restricting State Taxing Powers Under the Commerce Clause	325	(2)
Imports and Exports	327	(24)
Imports	327	(1)
Michelin Tire Corp. v. Wages	327	(11)
Notes and Questions	338	(2)
Exports	340	(1)
Department of Revenue of the State of Washington v. Association of Washington Stevedoring Companies	340	(7)
Notes and Questions	347	(4)
Jurisdiction to Tax	351	(79)
Due Process and Commerce Clause Restraints on State Taxing Jurisdiction	351	(1)
Quill Corporation v. North Dakota	351	(15)
Notes and Questions	366	(4)
Jurisdiction to Tax Income	370	(1)
J. C. Penney National Bank v. Johnson	370	(12)
Notes and Questions	382	(5)
Geoffrey, Inc. v. South Carolina Tax Commission	387	(5)
Notes and Questions	392	(3)
Corporate Excise DOR Directive 96-2	395	(3)
Notes and Questions	398	(4)
Public Law 86-272: Congressional Action Restricting the Power of State Taxation of Interstate Businesses	402	(2)
Notes and Questions	404	(2)
Wisconsin Department of Revenue v. William Wrigley, Jr., Co.	406	(13)
Notes and Questions	419	(7)
What Constitutes ``Doing Business'' Under the State Taxing Statutes	426	(1)
Notes and Questions	426	(4)
Corporate Income, Franchise, and Capital Stock Taxes	430	(260)
Introductory Note	430	(2)
Capital Stock Taxes	432	(3)
Introductory Note	432	(1)
Capital Stock Taxes Measured by Authorized Capital Stock	433	(1)
Capital Stock Taxes Measured by Issued Capital Stock	434	(1)
Corporate Income Taxes	435	(2)
Division of the Tax Base	437	(253)
Introductory Note	437	(4)
Apportionment by Formula in General: Federal Constitutional Limitations	441	(1)
The Apportionable Tax Base	442	(1)
Fargo v. Hart	443	(3)
Notes and Questions	446	(1)
Exxon Corporation v. Wisconsin Department of Revenue	446	(5)
Notes and Questions	451	(1)
Allied-Signal, Inc. v. Director, Division of Taxation	452	(13)
Notes and Questions	465	(2)
Hunt-Wesson, Inc. v. Franchise Tax Board of California	467	(4)
Notes and Questions	471	(1)
Fair Apportionment	472	(1)
Underwood Typewriter Co. v. Chamberlain	473	(2)
Notes and Questions	475	(1)
Hans Rees' Sons v. North Carolina Ex Rel. Maxwell	475	(5)
Notes and Questions	480	(3)
Butler Bros. v. McColgan	483	(4)
Notes and Questions	487	(2)
Norfolk and Western Railway Company v. Missouri State Tax Commission	489	(6)
Notes and Questions	495	(2)
Moorman Manufacturing Co. v. Bair	497	(12)
Notes and Questions	509	(5)
Apportionment by Formula as Applied to the Multicorporate Enterprise: Federal Constitutional Limitations	514	(1)
Mobil Oil Corporation v. Commissioner Of Taxes of Vermont	515	(17)
Notes and Questions	532	(6)
Container Corporation of America v. Franchise Tax Board	538	(21)
Notes and Questions	559	(5)
Delineation of the Scope of a Unitary Enterprise and Combined Reporting of Multicorporate Enterprises Under State Law	564	(1)
Dental Insurance Consultants, Inc. v. Franchise Tax Board	565	(6)
State Ex Rel. Arizona Department of Revenue v. Talley Industries, Inc.	571	(8)
Notes and Questions	579	(6)
In re: Envirodyne Industries, Inc.	585	(5)
Notes and Questions	590	(5)
The State Statutory Framework Governing Division of Corporate Income: The Uniform Division of Income for Tax Purposes Act	595	(10)
The Multistate Tax Compact	605	(8)
The Right to Apportion or Allocate the Tax Base	613	(1)
Notes and Questions	614	(2)
The Distinction Between Apportionable and Allocable Income Under State Division-of-Income Statutes	616	(1)
The Business-Nonbusiness Income Distinction Under UDITPA	617	(2)
Ex Parte Uniroyal Tire Company	619	(10)
Notes and Questions	629	(3)
Apportionment and Allocation of Income from Real and Tangible Personal Property	632	(1)
Apportionment and Allocation of Income from Intangible Property in General	633	(3)
Apportionment and Allocation of Interest Income	636	(1)
Sperry And Hutchinson Co. v. Department of Revenue	637	(2)
Notes and Questions	639	(2)
Apportionment and Allocation of Dividend Income	641	(1)
Notes and Questions	642	(4)
Apportionment and Allocation of Capital Gains and Losses	646	(1)
Apportionment and Allocation of Income from Patents, Copyrights, and Similar Intangibles	647	(1)
The Apportionment Formula: Delineation of the Factors	648	(1)
Property Factor	649	(1)
State of Alaska, Department of Revenue v. Amoco Production Company	649	(3)
Notes and Questions	652	(3)
Payroll Factor	655	(1)
Cincinnati, New Orleans and Texas Pacific Railway Company v. Kentucky Department of Revenue	656	(1)
Notes and Questions	657	(1)
Receipts or Sales Factor	658	(1)
Commonwealth of Pennsylvania v. Gilmour Manufacturing Company	659	(5)
Notes and Questions	664	(9)
Relief Provisions for Varying Statutory Formulas	673	(1)
Twentieth Century-Fox Film Corporation v. Department of Revenue	673	(5)
Notes and Questions	678	(3)
Methods of Apportionment for Special Industries	681	(9)
Sales Taxation	690	(238)
Introduction	690	(9)
The Classification and Nature of Sales Taxes	690	(2)
The Growing Fiscal Importance of State and Local Sales Taxes	692	(1)
Distribution of the Burden of Retail Sales and Use Tax	693	(3)
The Relationship Between the Fundamental Structural Flaws in the Retail Sales Tax and the Principal Legal Controversies it Raises	696	(3)
Retail Sales Taxes	699	(113)
Territorial Restrictions	699	(1)
Notes and Questions	700	(1)
Delineation of Taxable Sale	701	(1)
Taxable Sales of Tangible Personal Property as Distinguished From Nontaxable Sales of Services or Intangibles: The Personal Service Transaction Exemption	702	(1)
Washington Times--Herald v. District of Columbia	703	(1)
Notes and Questions	704	(2)
Southern Bell Telephone and Telegraph Company v. Department of Revenue	706	(3)
Notes and Questions	709	(1)
Taxable Sales of Tangible Personal Property as Distinguished From Nontaxable Sales of Services or Intangibles: The ``True Object'' and Similar Tests	710	(1)
Navistar International Transportation Corporation v. State Board of Equalization	710	(7)
Notes and Questions	717	(2)
City of Boulder v. Leanin' Tree, Inc.	719	(9)
Notes and Questions	728	(1)
Taxable Sales of Tangible Personal Property as Distinguished From Nontaxable Sales of Services or Intangibles: Computer Software	729	(2)
Sales of Separately Identifiable Property and Services ``Bundled'' in a Single Contract	731	(1)
Rylander v. San Antonio Smsa Limited Partnership	732	(5)
Notes and Questions	737	(1)
Leases of Tangible Personal Property as a Sale	738	(1)
Notes and Questions	738	(6)
Retail Sale	744	(1)
Sale for Resale Exemption	745	(1)
Fairlawn Shopper, Inc. v. Director, Division of Taxation	745	(4)
Notes and Questions	749	(8)
Manufacturing, Processing, and Fabrication Exemptions	757	(1)
Kaiser Steel Corporation v. State Board of Equalization	758	(5)
Notes and Questions	763	(5)
Machinery or Equipment Used in the Manufacture, Production, or Processing of Tangible Personal Property to Be Sold	768	(1)
Concord Publishing House, Inc. v. Director of Revenue	769	(9)
Notes and Questions	778	(5)
Containers and Packaging	783	(1)
Taxation of Services	784	(1)
Introductory Note	784	(3)
Repair, Alteration, and Servicing of Tangible Personal Property	787	(1)
Covington Pike Toyota, Inc. v. Cardwell	787	(3)
Notes and Questions	790	(2)
Computer, Data Processing, and Information Services	792	(1)
Notes and Questions	792	(1)
Telecommunications Services	793	(4)
Notes and Questions	797	(2)
Taxable Services and the Sale-for-Resale Exclusion	799	(1)
Notes and Questions	799	(3)
Real Estate Construction and Repair	802	(1)
G. S. Lyon & Sons Lumber v. Department of Revenue	802	(6)
Notes and Questions	808	(4)
Use Taxes	812	(16)
Introductory Note	813	(1)
Commissioner of Revenue v. J. C. Penney Company, Inc.	814	(7)
Notes and Questions	821	(7)
Exemptions and Miscellaneous Exclusions From Sales and Use Taxes	828	(3)
Notes and Questions	829	(2)
Measure of the Sales and Use Tax	831	(5)
Notes and Questions	832	(4)
Collection of the Tax by the Vendor	836	(4)
Notes and Questions	837	(3)
The Taxation of Interstate Sales	840	(36)
Taxation of Interstate Sales and the Out-of-State Vendor's Duty to Collect Sales and Use Taxes	840	(1)
McLeod v. J. E. Dilworth Co.	840	(1)
General Trading Co. v. State Tax Commission	840	(1)
International Harvester Co. v. Department of Treasury	840	(8)
Notes and Questions	848	(8)
Assignment	856	(1)
Apportionment of The Sales Tax Measure	856	(1)
Oklahoma Tax Commission v. Jefferson Lines, Inc.	856	(16)
Notes and Questions	872	(4)
Taxation of Electronic Commerce	876	(27)
A Global Overview	877	(11)
Notes and Questions	888	(1)
Sales and use Taxation of Electronic Commerce: Overview of the Principal Issues	888	(8)
The Developing ``Law'' of Sales and Use Taxation of Electronic Commerce	896	(1)
Notes and Questions	896	(7)
Fundamental Sales Tax Reform	903	(25)
Introduction	903	(1)
Streamlined Sales Tax	904	(21)
Notes and Questions	925	(3)
Personal Income Taxes	928	(85)
Introductory Note	928	(1)
Conformity of State Income Taxes to the Federal Income Tax	929	(1)
Notes and Questions	930	(3)
Residence, Domicile, and Place of Abode	933	(1)
Notes and Questions	933	(4)
The Taxation of Income of Residents	937	(1)
States' Constitutional Power to Tax All of a Resident's Personal Income Regardless of Source	937	(1)
Notes and Questions	938	(2)
State Statutory Treatment of Residents' Personal Income	940	(1)
The Taxation of Income of Nonresidents	940	(1)
States' Constitutional Power to Tax a Nonresident's Income Derived From Sources Within the State	940	(2)
Notes and Questions	942	(3)
Application of the Source Principle: Statutory and Constitutional Issues	945	(1)
Zelinsky v. Tax Appeals Tribunal of the State of New York	945	(7)
Notes and Questions	952	(8)
State's Power to Determine Nonresident's Tax Rate by Reference to All of Nonresident's Income	960	(1)
Wheeler v. State of Vermont	960	(4)
Notes and Questions	964	(1)
Discrimination Against Nonresidents	965	(1)
Lunding v. New York Tax Appeals Tribunal	965	(9)
Notes and Questions	974	(2)
Change of Residence	976	(1)
Notes and Questions	976	(2)
Taxation of Income From Partnerships	978	(1)
Weil v. Chu	979	(3)
Notes and Questions	982	(2)
Taxation of Income of Estates and Trusts	984	(1)
Chase Manhattan Bank v. Gavin	985	(16)
Notes and Questions	1001	(6)
Credit or Allowance for Taxes Paid to Other States	1007	(1)
Notes and Questions	1008	(3)
Municipal Income Taxes	1011	(1)
Notes and Questions	1011	(2)
Exemptions From Taxation	1013	(26)
Introductory Note	1013	(2)
Exemption of Educational, Philanthropic, and Religious Organizations	1015	(2)
Property Taxes	1017	(1)
Ownership and Use Test of the Property Tax Exemption	1018	(1)
Christian Home for the Aged, Inc. v. Tennessee Assessment Appeals Commission	1018	(4)
Notes and Questions	1022	(1)
The Delineation of Exempt Activities	1023	(1)
Dove Lewis Memorial Emergency Veterinary Clinic, Inc. v. Department of Revenue	1023	(6)
Notes and Questions	1029	(5)
Sales and Use Tax Exemptions	1034	(1)
Columbus Colony Housing, Inc. v. Limbach	1034	(3)
Notes and Questions	1037	(2)
Immunity of Federal Instrumentalities From State Taxation	1039	(42)
Sales, Use, Gross Receipts, and Other Excise Taxes	1039	(1)
United States v. New Mexico	1039	(10)
Notes and Questions	1049	(4)
Property Taxes	1053	(1)
Notes and Questions	1054	(2)
The Magnitude of Tax-Immune Federal Property	1056	(3)
Notes and Questions	1059	(1)
State Taxes Discriminating Against the Federal Government	1060	(1)
Davis v. Michigan Department of Treasury	1060	(6)
Notes and Questions	1066	(3)
Federal Statutory Rules Governing Federal Immunity From State Taxation	1069	(1)
State Taxation of Federal Obligations	1070	(1)
Notes and Questions	1070	(3)
State Taxation of National Banks	1073	(1)
Notes and Questions	1073	(2)
Other Congressional Statutes Delineating Federal Immunity From State Taxation	1075	(1)
Notes and Questions	1075	(2)
State Taxation of Indians	1077	(2)
References	1079	(2)
State Tax Procedure: Assessment, Collection, Refunds, and Judicial Remedies	1081	(44)
The Assessment of Taxes	1081	(2)
Notes and Questions	1083	(1)
Collection of Taxes	1084	(2)
Notes and Questions	1086	(2)
Challenging Assessments in Administrative Proceedings	1088	(2)
Suits to Recover Taxes	1090	(1)
Standing	1090	(1)
Notes and Questions	1090	(3)
Burden of proof	1093	(1)
Notes and Questions	1093	(2)
Other issues	1095	(1)
Notes and Questions	1095	(3)
Prospective or Retroactive Relief and Other Legal Remedies	1098	(1)
McKesson Corporation v. Division of Alcoholic Beverages and Tobacco	1098	(10)
Notes and Questions	1108	(5)
Injunctions and Other Equitable Remedies	1113	(1)
Notes and Questions	1113	(12)
Index	1125