Document: 380 U.S. 553 85 S.Ct. 1156 14 L.Ed.2d 68 GENERAL MOTORS CORPORATION, Petitioner,v.DISTRICT OF COLUMBIA. No. 352. Argued March 10, 1965. Decided April 27, Donald K. Barnes, Detroit, Mich., for petitioner. Henry E. Wixon, Washington, D.C., respondent. Mr. Justice STEWART delivered the opinion of Court. 1 The District Columbia Income and Franchise Tax Act 1947 imposes a tax 5% on taxable income every corporation, foreign or domestic, privilege engaging in any trade business within District.1 further provides that '(t)he measure franchise shall be portion net corporation * as is fairly attributable to carried engaged such other derived from sources District.'2 does not attempt define specific method whereby 'fairly attributable' determined, but authorizes Commissioners prescribe regulations determination.3 However, Commissioners' discretion devising unfettered, commands: 'If both without District, therefrom deemed District.'4 2 Acting pursuant authority delegated formulate governing allocation income, promulgated which provide: 'Where year manufacture sale purchase tangible personal property, thereof apportioned percentage total sales made during bear everywhere year.'5 3 petitioner, General Motors Corporation (G.M.), seeks review an en banc decision Court Appeals Circuit approved application these determining proportion its allocable purpose computing due.6 attacks this computation grounds it attributes unreasonably high therefore unauthorized by relevant sections statute, violative Interstate Commerce Due Process Clauses Constitution. We agree authorized D.C.Code reverse judgment reaching constitutional questions raised. 4 motor vehicles, parts, accessories. A Delaware petitioner maintains principal offices New York Detroit. It carries no manufacturing operations Columbia, makes substantial customers located chiefly retail automobile dealers. During years question, 1957 1958, volume aggregated $37,185,704 $32,542,519, respectively.7 Orders were received filled outside products shipped G.M. plants Maryland, Delaware, Michigan. 5 claim use 'sales-factor formula' beyond because formula taxes more than business, particularly light statutory provision District. exceeded their allocating disregard express restrictions law. 6 are normally content leave undisturbed decisions concerning import legislation affairs at times Code has impact confined Potomac's shores, far beyond. This case, approval lends sanction apportionment seriously variance with those prevailing vast majority States creates dangers multiple taxation. Where significance interstate commerce, where result reached involves statutorily unsupportable exertions administrative power, traditional reasons underlying our customary refusal interpretations law do apply. 7 course clear expressly particular On contrary, promulgate detailed multistate enterprises. But neither wholly unguided exercise authority. clearly limited (§ 47—1580a) requires doing inside arise situated like fashion. To understand meaning limitation, we need take simple example facilities Maryland sells all Columbia. Application would 100% corporation's Yet there can doubt viz., statute say only effect regulation. phrased broadly commands whenever 'the District.' As some part hypothetical conclusion follows must 'deem' 8 said grant language therefrom' § 47—1580a read mean 'net arising activities section so read, argued, reading least restricts formulae, canon broad construction revenue measures demands minimized. Applying approach case hand it, argued fulfilled obligation apportioning accordance geographical distribution company's sales. 9 Where, question allocate District.8 follow making kind alone relieves responsibility apportion limits. segment precisely same situation selling solely District; is, carrying partly enough under require taxed inescapable determinative fact before us company respect derives Consequently, 10 reach analysis plain also finds support consequences contrary view have overall pattern taxation commerce. great imposing corporate three-factor gives equal weight plant, payroll, sales.9 based factor, context general approach, will ordinarily income; property payroll themselves 67% whereas jurisdictions themselves. Conversely, cases enterprises plant sales-factor make 33% incomes subject state In sheer inconsistency generally may tend unhealthy fragmentation enterprise uneconomic location, presents added reason why give proper provisions Code. 11 Moreover, consistent concern shown imposed commerce apportioned. upholding Connecticut carefully inquired into reasonableness formulae used. 12 'The profits largely earned series transactions beginning ending states. was typical large conducted state. Legislature, attempting put upon fair share burden taxation, faced impossibility specifically processes borders. There nothing record show adopted inherently arbitrary, produced unreasonable result.' Underwood Typewriter Co. v. Chamberlain, 254 113, 120—121, 41 45, 47, 65 L.Ed. 165. 13 See Bass, Ratcliff & Gretton, Ltd. State Comm'n, 266 271, 45 82, 69 282. While refrained single appropriate apportionment, sought ensure methods used display modicum reasonable relation State. standard formula. See, e.g., supra; Butler Bros. McColgan, 315 501, 62 701, 86 991. justified rough, practical approximation either social costs generates. By contrast, itself, dubious indicating locus factor. position constitutionality factor alone. For present purpose, sufficient note factors alluded justifying constitutionally challenged past lend little exclusively sales-oriented approach. construing prohibit formula, sacrifice none values scrutiny protect. sum, find authorizing permit draw examination conflict taxing view. continuing displayed over scrutinizing statutes. confides regulations, prescription, limit ourselves holding regulation statute. Accordingly, reversed remanded proceedings opinion. 15 Reversed remanded. 16 BLACK DOUGLAS, agreeing here controlling affirm judgment. 1961, 47—1571a. 47—1580. 47—1580a. Ibid. Section 10.2(c) Regulations, relettered amendment July 24, 1956. 118 U.S.App.D.C. 381, 336 F.2d 885, certiorari granted, 379 887, 156, 91. An earlier (91 Wash.Law Rep. 650) panel Court, reviewed, had affirming (CCH D.C.Tax 200—006). Out $9,461,855,874 and.$7,853,393,381 1958. engage segmentation source thereof. All required account spread major dimensions business. Of 38 requiring payment taxes, 26 employ varieties takes sales, giving each Another three substantially replacing broader category costs. another incorporates factors. Only four geographic H.R.Rep.No. 1480, 88th Cong., 2d Sess., 119.

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