Source: https://www.legalcrystal.com/case/97909/richfield-oil-corp-vs-state-bd-equalization
Timestamp: 2019-04-25 14:51:28+00:00

Document:
1. A judgment of the Supreme Court of California reversing, without directions, a judgment for the plaintiff in a suit for a refund of a tax unconstitutionally levied on an export under the California Retail Sales Tax Act, the case having been tried on the pleadings and stipulated facts and the State Supreme Court having passed on the issues which control the litigation, held reviewable here as a "final judgment" within the meaning of Judicial Code § 237, 28 U.S.C. § 344(a). P. 329 U. S. 72 .
a shipper's export declaration, and did not collect, nor attempt to collect, any sales tax from the purchaser. Held that a tax levied upon appellant pursuant to the California Retail Sales Tax Act and measured by the gross receipts from the transaction was an impost upon an export, within the meaning of Art. I, § 10, Cl. 2 of the Federal Constitution, and therefore unconstitutional. Pp. 329 U. S. 71 -72, 329 U. S. 75 .
3. The fact that the provision of the Federal Constitution that no State shall, without the consent of Congress, lay "any" tax on imports or exports specifies but a single exception -- "except what may be absolutely necessary for executing it's inspection Laws" -- indicates that no other qualification of the absolute prohibition was intended. P. 329 U. S. 76 .
4. The constitutional prohibition against "any" state tax on imports or exports is not to be read as a prohibition against any "discriminatory" state tax. P. 329 U. S. 76 .
5. The commerce clause and the import-export clause of the Constitution, though complementary, serve different ends, and the limitations of the former are not to be read into the latter. P. 329 U. S. 76 .
6. The constitutional prohibition of "any" state tax on exports is not to be read as containing an implied qualification. Pp. 329 U. S. 76 -77.
7. The process of exportation commenced not later than when the oil was delivered into the vessel of the foreign purchaser. P. 329 U. S. 83 .
8. The construction of a state tax law by the highest court of the State is binding here, but is not determinative of whether the tax denies the taxpayer a federal right. P. 329 U. S. 84 .
9. Whether a state tax denies a federal right depends not upon the State's characterization of the tax, but upon its operation and effect. P. 329 U. S. 84 .
10. The incident which gave rise to the accrual of the state tax in this case -- viz., the delivery of the oil into the vessel of the foreign purchaser -- was a step in the export process. P. 329 U. S. 84 .
11. The constitutional prohibition of state taxes on exports involves more than a mere exemption from taxes laid specifically upon the exported goods themselves. P. 329 U. S. 85 .
Appellant brought suit in a state court for a refund of an allegedly unconstitutional state tax. A judgment for the appellant was reversed by the state supreme court. 27 Cal.2d 150, 136 P.2d 1. Appellant appealed to this Court. Reversed, p. 329 U. S. 86 .
The designation given the judgment by state practice is not controlling. Department of Banking, Nebraska v. Pink, 317 U. S. 264 , 317 U. S. 268 . The question is whether it can be said that "there is nothing more to be decided" ( Clark v. Williard, 292 U. S. 112 , 292 U. S. 118 ), that there has been "an effective determination of the litigation." Market Street R. Co. v. Railroad Commission, 324 U. S. 548 , 324 U. S. 551 ; see Radio Station W.O.W. v. Johnson, 326 U. S. 120 , 326 U. S. 123 -124. That question will be resolved not only by an examination of the entire record ( Clark v. Williard, supra ), but, where necessary, by resort to the local law to determine what effect the judgment has under the state rules of practice. Brady v.
decided. The jurisdictional objection is thus without merit. See Gulf Refining Co. v. United States, 269 U. S. 125 , 269 U. S. 136 .
27 Cal.2d at 153, 163 P.2d at 3. The court, in reaching the conclusion that the tax was constitutional, rested in part on our recent decisions (particularly McGoldrick v. Berwind-White Coal Mining Co., 309 U. S. 33 ; Department of Treasury v. Wood Preserving Corp., 313 U. S. 62 ; International Harvester Co. v. Department of Treasury, 322 U. S. 340 ) which sustained the levy of certain state taxes against the claim that they violated the Commerce Clause. Article 1, § 8, Cl. 3. The court concluded that, if this had been an interstate transaction, it would have been subject to the tax. It saw no greater limitation on the power of the States under Article I, Section 10, Clause 2, than this Court has found to exist under the Commerce Clause.
303 U. S. 250 , 303 U. S. 254 -255, and cases cited; McGoldrick v. Berwind-White Coal Mining Co., supra ), and by invalidating those which discriminate against interstate commerce, which impose a levy for the privilege of doing it, which place an undue burden on it. Adams Mfg. Co. v. Storen, 304 U. S. 307 ; Gwin, White & Prince, Inc. v. Henneford, 305 U. S. 434 ; Best & Co. v. Maxwell, 311 U. S. 454 ; Nippert v. Richmond, 327 U. S. 416 .
Page 116 U. S. 527 .
P. 192 U. S. 427 .
The circumstance that title was in the New York commission house and that it might change its mind and retain the goods for its own use was dismissed by the statement that "Theoretical possibilities may be left out of account." Page 262 U. S. 70 . The Court concluded that, if exportation was put at a later point, exports would not receive "the liberal protection that hitherto they have received." P. 262 U. S. 70 .
It seems clear under the decisions which we have reviewed involving Article I, Section 9, Clause 5 of the Constitution that the commencement of the export would occur no later than the delivery of the oil into the vessel. As the meaning of "export" is the same under that Clause and the Import-Export Clause ( see Brown v. Maryland, supra, p. 25 U. S. 445 ; Turpin v. Burgess, supra, p. 117 U. S. 506 ), the same result follows here.
That construction, being a matter of state law, is binding on us. But it is not determinative of the question whether the tax deprives the taxpayer of a federal right. That issue turns not on the characterization which the state has given the tax, but on its operation and effect. See St. Louis Southwestern R. Co. v. Arkansas, 235 U. S. 350 , 235 U. S. 362 ; Kansas City, Ft. S. & M. R. Co. v. Botkin, 240 U. S. 227 , 240 U. S. 231 .
And see Anglo-Chilean Nitrate Sales Corp. v. Alabama, 288 U. S. 218 .
See Carson Petroleum Co. v. Vial, 279 U. S. 95 .
Richfield Oil Corporation, while doing business in California, sold oil extracted from California soil. Its purchaser bought the oil to transport and use abroad. California, like many other states, raises a large proportion of its revenue by a generally applied tax on sales. * The Court holds that application of the California sales tax to this transaction is a "tax on exports," and therefore violates Article 1, Section 10, Clause 2 of the Federal Constitution. I cannot agree.

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