Opinion ID: 1779931
Heading Depth: 3
Heading Rank: 4

Heading: Tax is Fairly Related to Services of the State

Text: ¶ 29. The final prong of the test determines whether the activity which generated the income is related to the activities conducted in Mississippi. Additionally, the fourth prong of the Complete Auto test focuses on the wide range of benefits provided to the taxpayer, not just the precise activity connected to the interstate activity at issue. Goldberg v. Sweet, 488 U.S. 252, 267, 109 S.Ct. 582, 102 L.Ed.2d 607 (1989). In the present case, all of the activities mentioned above occurred in Mississippi and relate to the particular sales in question. Moreover, Murphy receives police and fire protection, use of transit in Mississippi and other advantages of civilized society. See D.H. Holmes Co., Ltd. v. McNamara, 486 U.S. 24, 32, 108 S.Ct. 1619, 100 L.Ed.2d 21 (1988). Furthermore, [Murphy] is currently availing itself of the use of our court system. Tenn. Gas Pipeline, 594 So.2d at 619. It follows that [Murphy] should pay its share of the tax burden in Mississippi although it is involved in interstate commerce. Id. (citing American Trucking Ass'ns, Inc. v. Scheiner, 483 U.S. 266, 296, 107 S.Ct. 2829, 97 L.Ed.2d 226 (1987)). Consequently, there is a fair relationship between the services provided by Mississippi in allowing the sales to occur and the value of those sales. Hence the fourth and final prong of the test is satisfied. ¶ 30. The franchise tax imposed by the Commission has a sufficient nexus with Mississippi; is fairly apportioned under the apportionment formula; does not discriminate against interstate commerce in favor of intrastate commerce; and is fairly related to services provided by Mississippi. Therefore, contrary to Murphy's contention, the franchise tax imposed by the Commission does not violate the commerce or due process clauses of the United States Constitution.