CONSTITUTIONAL LAW - VALIDITY OF STATE USE TAX ON MAIL ORDER SALES OF FOREIGN CORPORATION

Authors

Michigan Law Review, University of Michigan Law School

Abstract

The respondent, a New York corporation licensed to do retail business in Iowa, did a large mail order business there also. Iowa customers sent orders by mail to the company's warehouses located outside that state, and the merchandise was shipped directly to the purchaser. On these mail order sales the company neither collected from its customers, nor paid to the state, the Iowa use tax. The petitioner, chairman of the state tax commission, threatened to cancel the respondent's license as a retailer and its permit to do business in Iowa unless such use tax were paid. Respondent obtained an injunction against such action in the Iowa Supreme Court on the ground that the statute, as applied, violated section 8 of Article I of the United States Constitution and the Fourteenth Amendment. Held, two justices dissenting, that the Iowa use tax is not unconstitutional since there is no discrimination against interstate commerce and since the burden of collecting the tax was in return for the privilege of doing business in Iowa. Nelson. v. Sears, Roebuck & Co., (U.S. 1941) 61 S. Ct. 586.

Recommended Citation

Michigan Law Review, CONSTITUTIONAL LAW - VALIDITY OF STATE USE TAX ON MAIL ORDER SALES OF FOREIGN CORPORATION, 39 Mich. L. Rev. 1023 (1941).
Available at: https://repository.law.umich.edu/mlr/vol39/iss6/15