Source: https://supreme.justia.com/cases/federal/us/311/454/
Timestamp: 2019-04-20 20:18:07+00:00

Document:
1. A state statute which levies an annual privilege tax of $250 on every person or corporation, not a regular retail merchant in the State, who displays samples in any hotel room or house rented or occupied temporarily for the purpose of securing retail orders held invalid under the Federal Constitution as a discrimination against interstate commerce. P. 311 U. S. 456.
So held as applied to a nonresident merchant who took orders in the State and shipped interstate directly to customers, and where the only corresponding fixed-sum license tax exacted of "regular retail merchants" was $1 per annum for the privilege of doing business.
2. The freedom of commerce which allows the merchants of each State a regional or national market for their goods may not be fettered by legislation the actual effect of which is to discriminate in favor of intrastate businesses. P. 311 U. S. 457.
216 N.C. 114; 3 S.E.2d 292, reversed.
Appeal from a judgment reversing a judgment for the plaintiff in a suit for refund of a license tax. See also 217 N.C. 134; 6 S.E.2d 893.
for goods corresponding to samples; it filled the orders by shipping direct to the customers from New York City. Before using the room, appellant paid under protest the tax required by chapter 127, section 121(e), of the North Carolina Laws of 1937, which levies an annual privilege tax of $250 on every person or corporation, not a regular retail merchant in the state, who displays samples in any hotel room rented or occupied temporarily for the purpose of securing retail orders. [Footnote 1] Appellant, not being a regular retail merchant of North Carolina, admittedly comes within the statute. Asserting, however, that the tax was unconstitutional, especially in view of the commerce clause, art. 1, § 8, cl. 3, it brought this suit for a refund and succeeded in the trial court. The Supreme Court of North Carolina reversed, and then, being evenly divided on rehearing, allowed the reversal to stand. [Footnote 2] The prevailing opinion characterized the tax as one on the commercial use of temporary quarters, which in its operation did not discriminate against interstate commerce, and therefore did not come into conflict with the commerce clause.
their real local competitors, can operate only to discourage and hinder the appearance of interstate commerce in the North Carolina retail market. Extrastate merchants would be compelled to turn over their North Carolina trade to regular local merchants selling by sample. North Carolina regular retail merchants would benefit, but, to the same extent, the commerce of the Nation would suffer discrimination.
"(e) Every person, firm, or corporation, not being a regular retail merchant in the North Carolina, who shall display samples, goods, wares, or merchandise in any hotel room, or in any house rented or occupied temporarily, for the purpose of securing orders for the retail sale of such goods, wares, or merchandise so displayed, shall apply for in advance and procure a State license from the Commissioner of Revenue for the privilege of displaying such samples, goods, wares, or merchandise, and shall pay an annual privilege tax of two hundred fifty dollars ($250.00), which license shall entitle such person, firm, or corporation to display such samples, goods, wares, or merchandise in any county in this State."
216 N.C. 114, 3 S.E.2d 292; 217 N.C. 134, 6 S.E.2d 893.
Welton v. Missouri, 91 U. S. 275, 91 U. S. 282, 283; Guy v. Baltimore, 100 U. S. 434; Webber v. Virginia, 103 U. S. 344; Hale v. Bimco Trading Co., 306 U. S. 375. In McGoldrick v. Berwind-White Coal Min. Co., 309 U. S. 33, we pointed out that the line of decisions following Robbins v. Shelby County Taxing Dist., 120 U. S. 489, read in their proper historical setting, rested on the actual and potential discrimination inherent in certain fixed-sum license taxes. 309 U.S. at 309 U. S. 55-57. There is no occasion now to reexamine the particular tax statutes involved in those cases.
North Carolina Laws of 1937, c. 127, § 405.
Cf. Bacardi Corp. v. Domenech, ante, p. 311 U. S. 150.

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