Document: 423 U.S. 276 96 S.Ct. 535. 46 L.Ed.2d 495 MICHELIN TIRE CORPORATION, Petitioner,v.W. L. WAGES, Tax Commissioner, et al. No. 74-1396. Argued Oct. 15, 1975. Decided Jan. 14, 1976. Rehearing Denied Feb. 23, See 424 935, 1151. Syllabus Georgia's assessment of a nondiscriminatory ad valorem property tax against petitioner's inventory imported tires maintained at its wholesale distribution warehouse in the State held not to be within Import-Export Clause's prohibition States laying "any Imposts or Duties on Imports." Low v. Austin, 13 Wall. 29, overruled. Pp. 281-302. (a) In history Clause, whose purposes were commit Federal Government exclusive power regulate foreign commerce and right all revenues from imposts duties imports, assure free flow goods among by prohibiting taxing merely flowing through seaboard other States, there is nothing suggest that imposed are no longer import transit was type exaction regarded as objectionable Framers Constitution. 283-286. (b) Such taxation cannot affect Government's regulation commerce, since such does fall imports because their place origin it used create special protective tariffs particular preferences for certain domestic applied selectively encourage discourage any importation manner inconsistent with federal regulation. P. 286. (c) Nor will deprive definition only extends exactions category. Unlike duties, which essentially taxes commercial privilege bringing into country, apportions cost services police fire protection beneficiaries according respective wealth, reason why an importer should share these costs his competitors handling goods. 286-288. (d) interfere States. Importers destined inland can easily avoid using modern transportation methods, extent may increase purchased "inland" consumers, cost, quid pro quo benefits actually conferred State, one ultimate consumers pay for. The prevention more than fees could otherwise due peculiar geographical situation secured even still transit. 288-290. (e) while terms excepting some impact exports, couched broad every "tax," but prohibits "Imposts Duties," historically connoted directed activity such. 290-293. (f) Since would further objectives clearest constitutional mandate lead condemnation taxation, terminology Duties" sufficiently ambiguous warrant presumption intended embrace evils Clause specifically eliminate. 293-294. 233 Ga. 712, 214 S.E.2d 349, affirmed. Earle B. May, Jr., Atlanta, Ga., petitioner. H. A. Stephens, respondents. Mr. Justice BRENNAN delivered opinion Court. 1 Respondents, Commissioner Assessors Gwinnett County, assessed tubes petitioner France Nova Scotia included dates county. Petitioner brought this action declaratory injunctive relief Superior Court alleging exception passenger had been removed original shipping cartons,1 prohibited Art. I, § 10, cl. 2, Constitution, provides pertinent part: "No shall, without Consent Congress, lay Imports Exports, except what absolutely necessary executing inspection Laws . .." After trial, granted requested relief. On appeal, Supreme Georgia affirmed part reversed part, agreeing corrugated cartons immune holding lost status become subject they mingled bulk, sorted, arranged sale. 349 (1975). We certiorari, 422 1040, 95 2652, 45 692 question presented whether correct tax.2 affirm addressing imports. hold that, event, " insofar 20 L.Ed. 517 (1872) contrary, decision 2 * Petitioner, New York corporation qualified do business Georgia, operates distributor United automobile truck manufactured Michelin Tires Ltd. operated warehouses various parts country. Distribution sale County limited 250-300 franchised dealers whom six southeastern Some 25% Of Scotia, tractor-driven, over-the-road trailers packed sealed factory. remaining 75% sea vans factories. Sea wheels before being loaded aboard ship. Upon arrival ship port entry, unloaded, replaced, tractor-hauled after clearing customs upon payment 4% Import duty. 3 tires, each has own serial number, bulk vans, packaged bundled. They lose identity unit, however, when unloaded warehouse. When sorted size style, segregation manufacture, stacked wooden pallets bearing four stacks five same stored pallet three each. This processing required performed ready delivery dealers. 4 Sales average 4,000-5,000 pounds per Orders filled regard shipments arrived manufacture. Delivery common carrier customer pickup. II 5 Both courts addressed whether, character fell ." expressed strong doubts concluded bound Court's decisions contrary. stated: 6 "While seem where said have placed (petitioner's) general purpose customers, taxed so if supported law, clear resale retains exemption until sale," "(for) (t)he immunity local includes taxes; Hooven & Allison Company Evatt, 324 652 (65 870, 89 1252); 80 29 (20 517)." Pet. Cert., App. A-4, A-3. 7 Similarly, stated, 722, S.E.2d, 355: 8 "(Petitioners) argue annual meaning provision. reject argument basis above-cited authority. (E. g., Austin.)" 9 supra, leading imposing incorporated mass State. reviewed California sustained constitutionality California's ground therefore did prohibit property. Wall., 30-31. reading seminal construing Brown Maryland, 12 Wheat. 419, 678 (1827), "(w)hilst retaining them, shape, prohibition." 34. 10 Scholarly analysis uniformly critical Austin. It true Chief Marshall, speaking 442, "while (the thing remains) importer, warehouse, form package imported, too plainly duty escape constitution." Commentators agreed Austin misread dictum "imposts" "duties," contrary conclusion inferred consideration specific abuses led include ImportExport See, e. Powell, Taxation Does Cease Be Import?, 58 Harv.L.Rev. 858 (1945); Note, Court, 1958 Term, 73 126, 176 (1959); Early Weitzman, A Century Dissent: Immunity Goods Imported Resale From Nondiscriminatory Personal Property Taxes, Sw.U.L.Rev. 247 (1975); Dakin, Protective Cloak Export-Import Clause: Process?, 19 La.L.Rev. 747 (1959). 11 Our independent study persuades us state Constitution mind "impost" "duty" Austin's reliance reach misplaced. III One major defects Articles Confederation, compelling calling Constitutional Convention 1787, fact left individual burden both themselves countries very much pleased. Before 1787 commonplace facilities derive revenue defray governments customers At time, secure source central government. James Madison, Preface Debates M. Farrand, Records p. 542 (1911) (hereafter Farrand), graphic description situation: "The dissatisfaction having convenient ports neighbors, thro ports, carryed on. Jersey, between Phila. N. York, likened Cask tapped ends: Carolina Virga. S. patient bleeding Arms. Confederation provided remedy complaint: produced protest Jersey; never ceased discord, new superseded old."3 And further, id., 546-548: 14 "Rh. I. compliance recommendation Annapolis (to Const. Convention), well known swayed obdurate adherence advantage her position gave neighbors thro' consumption supplies, foreseen taken revisal Confederation. 15 want over Commerce exercise separately, wch proved abortive, engendered rival, conflicting angry regulations. Besides vain attempts supply treasuries imposts, turned neighbouring co-erce relaxation British monopoly W. Indn. navigation, attemted irritated adjoining trading N.Y. Pena. S-Carolina." 16 thus sought alleviate main concerns committing sole Government, concurrent power: must speak voice regulating relations governments, tariffs, might relations, implemented consistently power;4 diverted States;5 harmony disturbed unless crucial levying citizens situated favorably geographically.6 17 Nothing remotely suggests also For exaction, unlike discriminatory impediment severely hampered constituted tribute disadvantage 18 obvious whatsoever probably most important prohibition. By definition, origin. goods, category; category, deprives entitled. wealth; bear along clearly based read accord preferential treatment permits uniform supplies. May Orleans, 178 496, 976, 44 1165, 502-504, 507-509 (1900). diminish impost economic purchase avoidance incidental effect not, objective enacting Certainly think so. Wheat., 443-444. Taxes initial sale, breakup packages, moment use committed current operational needs likely volume imported; yet permissible. Waring Mayor, 110, 342 (1869) (taxation sale); packages); Youngstown Sheet Tube Co. Bowers, 358 534, 79 383, 490 (1959) manufacturer). What those share, emphasized, characteristic increased substantially impair importation.7 Finally, under solely Indeed, importers today's world. Modern methods air freight containerized packaging, development railroads Nation's internal waterways, enable directly example, centers Actually, quarter distributed interstate Canada. To sure, allowance consumers.8 But already noted, There taxpayers subsidize importer; accorded just associated goods.9 An evil prevented enabled them single out effect, fashioned prevent imposition moving State.10 non-discriminatory obviously stands different footing, conflict assessed.11 21 Admittedly, wording exports. clearly, written "tax." "Imports." contrast, Congress empowered "lay collect Duties, Imposts, Excises" lends support "tax" falls measure Professor Crosskey makes persuasive demonstration words "duties" meanings understood "Imposts" like is, charges levied time importation. "Duties" broader term embracing excises capitation, land, rather "duty." Crosskey, Politics History 296-297 (1953).12 and, purposefully employed less geographically. 22 condemn taxation. we decline presume IV 23 nevertheless expanded taxes, analysis, statement Maryland marked line "where ends, begins, precision admits." 32. properly propose "duties." statute wholesalers selling bale package, obtain license $50 fee therefor, forfeitures penalties noncompliance. contested validity statute, arguing "palpable evasion" equivalent contended asserted differences formal substantial: country realistically divorced importation, 422; irrelevant either 423; person levy ibid. impose entail price market entirely, repugnant 423-425. 24 Attorney General Roger Taney, later Justice, defended Maryland's law. He argued importers, occupation more, importers. broadly necessarily immunize time. Moreover, concomitant importing, much; sell manner, importing regulations concerning noxious city, auctioning public warehouses, retail traveling peddler, activities traditionally 25 refused define comprehensively, "whether legislature constitutionally require articles take he shall permitted imported." 436. However, "imposts, significantly characterized "a custom country," 437, although normally enter, entry; "imports" act importation; "extends imported) entered 438. article introduction licenses Id., 439. 26 Taney's persuasive, "was prompted declare ought pressed utmost extent; our complex system, object powers government Union, nature often remain always view (T)here point ceases, commences 441. 27 stated two situations apply. case devised evidentiary tool, "original package" test, making determination. formula was: "It sufficient present say, generally, acted mixed up has, perhaps, distinctive import, State; 441-442. matter hornbook knowledge Marshall illustration, formula, application evidentiary, substantive Galveston Mexican Petroleum Corp., F.2d 208 (SD Tex.1926). 28 significance case, first characteristics levies. clue express authorizing "imposts duties" "may State's) Laws." "(T)his exception," "in favour laws, goes far proving framers constitution classed similar inspection, supposed prohibited." 438 (emphasis supplied). levy, illustrated "the intercepts way property, denies becoming contributed State." 443 kinds examples neutral taxation: itinerant peddlers, service charge auctioneer, plate furniture personally importer. These considered taxed. 443, 444. singled property." 443. (Emphasis supplied.) Thus, actions mingle "lose imports" render mean absence action, Rather, implied apply treated packages differently "common country"; depend origins 30 Despite language despite ignored warning boundary persons jurisdictions limitations respect subtle difficult drawn cases arise. cautionary remark reasons, "might premature rule universal application." Although "sufficient" context note prohibition, observation apply, foregoing indicates, 31 compounded error misreading views Taney License Cases, How. 504 (1847) (six Justices wrote separately cases). As observed, requirement "imports." Cases observed "further mature reflection convinced me laid down (in ) safe one, perhaps best adopted preserving hand, other, preventing collision them. question, I said, judicial mind. things, division degree vague indefinite, see how accurately correctly, intention provision constitution. hands shape sense usually government." How., 575. 32 quoted excerpt, 33-34, supporting holding, 34, (imported goods), crystal taxes. For, continuing paragraph excerpted concluded: "A done directly, expressly prohibited. hardly sound construction accomplish precisely another name, form." 576 then went distinguish indiscriminately owners stating, : 33 "Undoubtedly proportion amount respectively worth; merchant liable citizen, chargeable consists money engaged trade, proposes sell, owner. 34 footing remains introduced 35 Thus authority, Clause. 36 follows wrongly decided. That be, overruled.13 V 37 Petitioner's conducted operation, taking orders filling constantly replenished inventory. utilized wholesaler dealing interdicted judgment accordingly 38 Affirmed. 39 STEVENS took case. 40 WHITE, concurring judgment. 41 Being involved here subjecting consistent interpreted prior cases, including (1872), little necessity overrule None parties challenged here, issue overruling briefed argued. complaint conceded taxability cartons. value $633.92 date January 1, 1972, $664.22 1973. 1972 $8.03 1973 $8.73. respondents cross-petition affirmance tax, review. Madison noted States' aversion transfer "notwithstanding urgent demands Treasury; glaring inadequacy authorized mode supplying it, rapid growth anarchy Fedl. System, animosity kindled members regulations." Farrand 544. also, (Mr. Randolph's comments Confederation); 462 Ghorum, explaining small formation notes: "Should separation place, fate Jersey wd. worst all. She little. Pa. continue consumption"); 328-329 Madison's remarks during debate Virginia Convention). 439 (1827); Cook Pennsylvania, 97 566, 574, 1015 (1878); 555-556, (Frankfurter, J., dissenting); Federalist Nos. (Hamilton), 42 (Madison), (Madison); 135, 157-158, 169 (notes Committee Detail); 441; 520-521 (letter Davis); 547-548. 439; U.S., 556, 12. 440; 1015; 545, 490; 556-557, 383 441-442, 589; 519 Davis). course, circumstances inconceivable. pass law though operating "initial sale" would, invalidated was, practical impost. otherwise. presumed stages activity, impositions discriminatory. importer's disapproved 566 (1878), auction discriminated depending relevant competition forced absorb assessments passing consumers. Cooley Board Wardens Port Philadelphia, 299, 996 (1852), upheld pilotage city Philadelphia. rejected duties," 314: "(The Clause) operate subjects existing formed. tonnage civilized world distinct pilotage, enforced pilot-laws, wharfage towage, port-charges rendered vessels cargoes; pilot-fees embraced tonnage, confound things different, who language. denied duty, name pilot dues penalties; certainly thing, considered. But, previously instance, complained appropriate limits laws pilots suggestion, levies admissible; so, follows, clause eighth section constitution, declares throughout States; for, deemed impost, excise, uniformity objectionable. conforming peculiarities port, consequent impossibility itself prove constitution; required, impracticable." fees, imported. mere 504, 575-576 (Taney, C.J.). invalid traditional analysis. 305, following reported occurred last draft submitted Detail: "Mr. Martin asked meant detail expression) 'duties' 'imposts.' If same, former unnecessary; made clear. Wilson, applicable many objects word relate. latter appropriated commerce; extend variety objects, stamp &c." Subsequently, "Genuine Information" Legislature, 203-204: "By article, excises. met convention adjournment, receive report committee detail, inform us, vested section, extended system exports laid. answer inquiry, informed, give paper, parchment, vellum. please. excises, odious nature, authorizes officers go your houses, kitchens, cellars, examine private concerns, consumption, food eat, liquors drink, clothes wear, glass enlightens hearths warmth comfort. proceed direct individual, capitation heads, therefore, please please, afterwards, whatever consume; please; afterwards people assessment, choose recognition encompass "taxes" appears 12, pp. 80-81, 84 (Bourne ed. 1947): evident habits people, experience itself, impracticable raise considerable sums multiplied; enforce collection tried; expectation disappointed, remained empty. popular administration inherent government, coinciding real scarcity incident languid mutilated hitherto defeated experiment extensive collections, length taught legislatures folly attempting acquainted happens surprised circumstance. opulent nation Britain, superior wealth tolerable, vigor practicable, America, greatest national derived indirect kind, large branch description. "In long means chiefly duties. confined narrow compass. genius ill brook inquisitive peremptory spirit excise laws. pockets farmers, reluctantly yield scanty unwelcome houses lands; personal precarious invisible fund imperceptible agency consumption. exist revenues. Destitute essential support, resign independence, sink degraded condition province. extremity choice accede. Revenue, events. principal oppressive weight land. intimated signification, unison feelings admit great taxation; nor, indeed, almost employment agriculture, proper numerous permit ample collections way. estate (as remarked), difficulty tracing subjected contributions, consumption." 30, 32, 35, 36; T. Cooley, Principles Law c. V, 3, VII, (Bruce 1931); J. Story, Commentaries §§ 946-950, 954, 1013-1014 (1833); n. 9, supra. context, "(i)n gives authority consent hence test determining convincing abandoning century 652, 668, 65 878, 1252 (1945). overlooked contains net Produce Use Treasury make absolute, immediately added proviso, "as imposts." 215-216 (Luther Martin's Information"). presumably enact legislation transferring funds back put States." congressional conform 8, "all Excises States?" authorize, undermine policies Clauses secure? Since, decided, occasion address consented

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