Opinion ID: 1904493
Heading Depth: 1
Heading Rank: 1

Heading: Constitutionality of the Reciprocal Truck Taxes

Text: Under the Commerce Clause a state tax on interstate commerce will pass muster only if the tax [1] is applied to an activity with a substantial nexus with the taxing State, [2] is fairly apportioned, [3] does not discriminate against interstate commerce, and [4] is fairly related to the services provided by the State. American Trucking Associations, Inc. v. Quinn, 437 A.2d 623, 625-26 (Me.1981) (quoting Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 279, 97 S.Ct. 1076, 1079, 51 L.Ed.2d 326 (1977)); see also Maryland v. Louisiana, 451 U.S. 725, 754, 101 S.Ct. 2114, 2133, 68 L.Ed.2d 576 (1981). The Superior Court found that section 2243-C failed to pass the third aspect of this test because on its face it discriminates against interstate commerce. To determine whether section 2243-C passes the third prong of the Complete Auto Transit test, we must assess it in light of its actual effect considered in conjunction with other provisions of the State's tax scheme, and we must decide whether section 2243-C will in its practical operation work discrimination against interstate commerce. Maryland v. Louisiana, 451 U.S. at 756, 101 S.Ct. at 2134. A statute's discriminatory effect on interstate commerce may be offset by complementary or offsetting taxes on domestic commerce. American Trucking, 437 A.2d at 626-27. In the present case, section 2243-C on its face discriminates against interstate commerce because it levies on certain foreign-registered trucks taxes that Maine does not assess against Maine-registered trucks. Since we are not referred to any statute by which Maine imposes a complementary or compensating tax on its domestic trucks to offset the inherently discriminatory effect of section 2243-C, [6] the reciprocal truck taxes must be struck down as a violation of the Commerce Clause of the United States Constitution. We read the decisions of the Supreme Court of the United States [7] to require nothing less, if our nation is to avoid `a multiplication of preferential trade areas destructive' of the free trade which the Clause protects. Boston Stock Exchange v. State Tax Commission, 429 U.S. 318, 329, 97 S.Ct. 599, 606, 50 L.Ed.2d 514 (1977) (quoting Dean Milk Co. v. Madison, 340 U.S. 349, 356, 71 S.Ct. 295, 298, 95 L.Ed. 329 (1951)). The State urges that section 2243-C does not violate the Commerce Clause because the Maine Legislature had no discriminatory purpose in its enactment, but rather intended to promote interstate commerce by attempting to make treatment of [foreign-registered] motor vehicles in Maine comparable with treatment of similar Maine-registered motor vehicles traveling in those [foreign] vehicles' jurisdictions of registration. L.D. 2412 Statement of Fact (111th Legis.1984). In other words, section 2243-C had as its candid purpose coercive retaliation to force the 13 offending states to drop the extra tax burdens they impose on Maine trucks. This type of legislative purpose has not, however, met with approval before the United States Supreme Court. To the extent, if any, that the 13 states whose vehicles are currently subject to Maine's reciprocal truck tax are themselves unconstitutionally burdening interstate commerce with their third structure taxes, the Commerce Clause itself creates the necessary reciprocity: [Maine and its truckers] may pursue their constitutional remedy by suit in state or federal court challenging [those 13 states'] actions as violative of the Commerce Clause, instead of enacting retaliatory taxes. Great Atlantic & Pacific Tea Co. v. Cottrell, 424 U.S. 366, 380, 96 S.Ct. 923, 932, 47 L.Ed.2d 55 (1976). A state may not violate the Commerce Clause in an attempt through self-help to coerce another state into desisting from a Commerce Clause violation. There also is no merit in the State's argument that section 2243-C is valid since it discriminates against only some, not all, foreign-registered trucks, i.e., only those trucks registered in those 13 jurisdictions imposing third structure taxes on Maine-registered vehicles that may go into those states. The Supreme Court rejected such an argument in Lewis v. B T Investment Managers, Inc., 447 U.S. 27, 100 S.Ct. 2009, 64 L.Ed.2d 702 (1980), when it struck down a Florida statute as violative of the Commerce Clause even though the statute discriminated against only certain types of out-of-state financial institutions. Id. at 40-43, 100 S.Ct. at 2017-19. Nothing in the present case suggests a different analysis. Balkanization, even though only partial, is still Balkanization. Because section 2243-C is discriminatory on its face and the State's scheme for taxing trucks lacks any complementary or offsetting taxes on domestic truckers, the statute must fall as offensive to the Commerce Clause. The Superior Court found no need to reach the alternative grounds upon which plaintiffs argue that the taxes imposed by section 2243-C are unconstitutional, and neither do we.