Document: 386 U.S. 753 87 S.Ct. 1389 18 L.Ed.2d 505 NATIONAL BELLAS HESS, INCORPORATED, Appellant,v.DEPARTMENT OF REVENUE the STATE ILLINOIS. No. 241. Argued Feb. 23, 1967. Decided May 8, Archibald Cox, Washington, D.C., for appellant. Terence F. MacCarthy, Chicago, Ill., appellee. Mr. Justice STEWART delivered opinion of Court. 1 The appellant, National Bellas Hess, is a mail order house with its principal place business in North Kansas City, Missouri. It licensed to do only that State and Delaware, where it incorporated. Although company has neither outlets nor sales representatives Illinois, appellee, Department Revenue, obtained judgment from Illinois Supreme Court required collect pay use taxes imposed by Ill.Rev.Stat. c. 120, § 439.3 (1965).1 Since National's constitutional objections imposition this liability present substantial federal question, we noted probable jurisdiction appeal.2 2 facts bearing upon relationship are accurately set forth Court: 3 '(National) does not maintain any office, distribution house, warehouse or other business; have agent, salesman, canvasser, solicitor type representative sell take orders, deliver merchandise, accept payments, service merchandise sells; own tangible property, real personal, Illinois; no telephone listing advertised sale newspapers, on billboards, radio television Illinois.'3 4 All contacts which via United States common carrier. Twice year catalogues mailed company's active recent customers throughout Nation, including Illinois. This mailing supplemented advertising 'flyers' occasionally past potential customers. Ordersfo r accepted at Missouri plant. ordered goods then sent either 5 manner doing sufficient under statute classify as '(r)etailer maintaining State,' since term includes retailer: 6 'Engaging soliciting orders within users means advertising, whether such received without State.' 439.2 (1965). 7 Accordingly, requires appellee tax consumers who purchase State.4 When collecting tax, must give purchaser 'a receipt therefor form prescribed (appellee),' if one demanded.5 also 'keep records, receipts, invoices pertinent books, documents, memoranda papers (appellee) shall require, require,' submit investigations, hearings, examinations needed administer enforce law.6 Failure keep records receipts punishable fine up $5,000 imprisonment six months.7 Finally, allow process an out-of-state like National, designates Secretary appointed collection suits attaches when served him notified registered mail.8 8 argues liabilities thus violate Due Process Clause Fourteenth Amendment create unconstitutional burden interstate commerce. These two claims closely related. For test particular state exaction invade exclusive authority Congress regulate trade between States, State's compliance requirements due area similar. See Central R. Co. Pa. v. Commonwealth Pennsylvania, 370 607, 621—622, 82 1297, 1306—1307, 720 (concurring Black). As former, held 'State taxation falling commerce * can be justified designed make bear fair share cost local government whose protection enjoys.' Freeman Hewit, 329 249, 253, 67 274, 277, 91 L.Ed. 265. Greyhound Lines, Inc. Mealey, 334 653, 663, 68 1260, 1266, 92 1633; Northwestern Portland Cement Minnesota, 358 450, 462, 79 357, 364, 421. And determining falls confines Clause, said 'simple but controlling question given anything ask return.' Wisconsin J. C. Penney Co., 311 435, 444, 61 246, 250, 85 267. Standard Oil Peck, 342 382, 72 309, 96 427; Ott Mississippi Val. Barge Line 336 169, 174, 69 432, 434, 93 585. same principles been applicable power impose burdens sales. Here, too, Constitution 'some definite link, some minimum connection, person, property transaction seeks tax.' Miller Bros. Maryland, 347 340, 344—345, 74 535, 539, 98 744; Scripto, Carson, 362 207—210—211, 80 619, L.Ed.2d66 0.9 American Neill, 380 451, 458, 1130, 1134, 14 1. 9 In applying these upheld seller variety circumstances. Where were arranged agents taxing State, power. Felt & Tarrant Mfg. Gallagher, 306 62, 59 376, 83 488; General Trading Tax Comm'n, 322 335, 64 1028, 88 1309. We reached result maintained retail stores. Nelson Sears, Roebuck 312 359, 58, 888; Montgomery Ward 373, 593, 897.10 those situations was plainly accorded services State. case represents furthest reach date deputize retailer agent 207, 660. There Florida could constitutionally Georgia duty shipped Florida. had '10 wholesalers, jobbers, 'salesmen' conducting continuous solicitation forwarding resulting Atlanta shipment goods.' U.S., 211, S.Ct., 621. 10 But never may payment connection carrier mail. Indeed, sharply differentiated situation outlets, pointing out 'those concerns receiving benefits Iowa exact price.' 365, 589. 744, Maryland obligation Delaware solicitors Maryland. wares residents through newspaper addition circulars four times year. result, made customers, deliveries them trucks drivers. 11 uphold case, would repudiate totally sharp distinction decisions drawn sellers solicitors, more than communicate part general business. basic distinction, until now generally recognized authorities,11 valid one, decline obliterate it. 12 need rest broad foundation all opinion, here there household deliveries, dissenters so largely relied. 358, 547. difficult conceive commercial transactions exclusively character involved. upheld, impediments free conduct imaginary remote. burdens, every so, indeed, municipality, school district, political subdivision Nation taxes.12 many variations rates tax,13 allowable exemptions, administrative record-keeping requirements14 entangle virtual welter complicated obligations jurisdictions legitimate claim government.' 13 very purpose Commerce ensure national economy unjustifiable entanglements. Under Constitution, domain alone regulation control.15 reversed. 15 Reversed. 16 FORTAS, whom BLACK DOUGLAS join, dissenting. 17 my Court's decision 660 (1960), well realistic approach pp ellant's business, dictates affirmance Hess large establishment specializing wearing apparel. Directly subsidiaries, operates headquarters Missouri, wholly owned subsidiaries operate number stores various States. 1961, appellant's net neighborhood $60,000,000, accounts receivable amounted about $15,500,000.1 19 Its $2,174,744 approximately months issue assessed. volume twice-a-year catalogue mailings, 'intermediate smaller 'sales books' 'flyers," court below styled them. contains 4,000 items merchandise. list over 5,000,000 names. even larger bulk addressed 'occupant.' 20 A Hess' credit. features 'NBH Budget Aid Credit'—which money down monthly payments include fee interest charge, incorporates agreement, unless expressly rejected purchaser, 'Budget Family Insurance.' offers 'charge account' services—payable 'service charge' account fully paid 30 days. filled credit purchases usual information, employment, name bank, marital status, home ownership rental. Merchandise bought c.o.d. sending check goods.2 21 should doubt large-scale, systematic, exploitation consumer market 'nexus' require remit especially coupled resources dependent mechanism banking institutions. simply using facilities serve regularly continuously engaged 'exploitation market' (Miller 347, 540, 744 (1954)) live work homes connections there, who, absent might buy locally support their carry particularly utilizing facilities. tried affidavits, informed details operations know utilizes information agencies, similar states 'brought Illinois.' Accepting true, nevertheless unreasonable assume assign otherwise measures delinquent accounts, activities assignees representatives. 22 enjoys of, profits nurtured by, store salesmen therein. did either, he benefit has—the ability utilize facilities, realize profit; and, time, additional taxes. arrangement, conducts substantial, regular, systematic demands customer-users—and State—the merely equal resident merchants remit. To excuse penalize retailers located rate 1/2%, realized communities requires, effect, much 5% added amount local, tax-paying pay,3 importance competitive discrimination becomes apparent. While advantage tolerable necessary consequence occasional, minor sporadic calculated, market, certainly extended instances exploiting large-scale basis. cases, difference nature conducted enterprise entitled significance. amounts $2,400,000,000 year.4 Some undoubtedly subject full range because location States,5 exempt nature. Report Special Subcommittee Taxation Interstate House Judiciary Committee, H.R.Rep. 565, 89th Cong., 1st Sess., Vol. (1965), 770—777. which, decision, will placed favored position exempted increase, haven immunity increase size importance. 23 supra, applied sensible, practical conception Clause. claimed had, appellant here, office employees there. solicited 'independent contractors' brokers commission furnished samples, forwarded state. 'charged tax—save fails refuses it' (362 621)6 'reimburs (ed seller) service' collector 212, 622). true case.7 I see how Scripto meaningfully distinguishable case. fact, involved single article 'exploitation' pervasive comprehensive involved, reference 24 is, course, controlled (1954). said, sold Delaware; 'no incidental effects invasion *.' 540. displaying products catalogs, samples like.' 622. On contrary, sends catalogue, mailings 'occupant,' extends based financial references. 25 says, comply levy variously formulated: 'whether return';8 State;9 nexus: 'Some tax.'10 However formulated, seems me entirely clear regularly, systematically, scale offering competition retailers, deferred-payment residents, excused Constitution. 26 hardly worth remarking expressions consternation alarm mechanics others similarly situated us pause. greater comparable obligations; response record keeping 'entangle' vastly underestimates skill contemporary man his machines. burden; another accepts mail; rd inary 27 affirm. 34 Ill.2d 164, 214 N.E.2d 755. 385 809, 50. Ill.2d, 166—167, N.e.2d, 757. Id., 439.5. 439.11. 439.14. 439.12a. Strictly speaking, link 'the person 660, user sells. being directly taxed, rather asked user. however, liable collected not. 439.8 acknowledges Alabama, Kansas, Mississippi, 1965, besides statutes eq uired participate system. However, administrators appear considered nexus insufficient. they testified doubts constitutionality underlay failure statutory authority. Committee Judiciary, H.R.Rep.No. 631—635 substantiated before us. Alabama Court, dealing found application invalid Federal Lane Bryant, Inc., 277 Ala. 385, 171 So.2d 91. 'Local today (1965) 2,300 localities. most complemented 827. 1964 seven different taxes: 2, 1/4, 1/2, 3, 4, 5%. 611—613, 607—608. Washington recently eighth, 4.2%. Wash.Rev.Code 82.12.020 (Supp.1965). 'The prevailing system (the rules differ application—especially industrial retailer—turns often too remote uncertain level accuracy demanded system.' 673. 'Given spread small moderate sized companies, just localities out-of-State registrants recordkeeping task multistate clearly intolerable.' 882. fact evidenced area. Tit. II, Pub.L. 86—272, 73 Stat. 556, amended 87—17, 75 41, authorized detailed congressional study resulted supra. 2013, 2d Sess. (1966). Moody's Industrial Manual (1962). Because Catalogue, Spring Summer 1967, supplement picture afforded record. current Pennsylvania. Pa.Stat.Ann., 72, 3403—201 (1964). World Almanac (1967, Newspaper Enterprise Assn.) 136—137. Bureau Census, 1963 Census Business, Retail Trade-Area Statistics, pt. 1, table p. 1—8 586, 888 (1941); 897 (1941). Our observation . 365—366, 589, (1941), apt able purchasers: '(S)o far assumed losses collections concerned, respondent right opportunities avoidance method affords elect paid.' Actually, appears minimize non-collection tax. provides 'discount 2% $5 per calendar year, whichever reimburse expenses incurred preparing filing returns, remitting supplying data 439.9 Appellant inadequate 267 (1940). 588, 344 345, 539.

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