Document: 412 U.S. 363 93 S.Ct. 2183 37 L.Ed.2d 1 UNITED STATES, Appellant,v.STATE TAX COMMISSION OF MISSISSIPPI et al. No. 72—350. Argued March 19, 1973. Decided June 4, Syllabus The United States brought this action contesting the validity of appellee Tax Commission's regulation requiring out-of-state liquor distillers and sumpliers to collect remit Commission a wholesale markup on sold military officers' clubs other nonappropriated fund activities located bases within Mississippi, over two which exercises exclusive jurisdiction, remaining concurrent jurisdiction. Relying Twenty-first Amendment, District Court upheld regulation. Held: 1. twenty-first Amendment does not empower State tax or otherwise regulate importation distilled spirits into terriory Collins v. Yosemite Park & Curry Co., 304 518, 58 1009, 82 L.Ed. 1502, regardless whether some may have been consumed off base. Pp. 369—378. 2. Whether can be viewed as sales whose imposition in context exclusive-jurisdiction has consented under Buck Act, whether, any event, unconstitutionally taxes federal instrumentalities, violates Supremacy Clause conflicting with procurement regulations policy, are issues that did reach should consider initially remand. 378—381. D.C., 340 F.Supp. 903, vacated remanded. Jewell S. Lafontant, Dept. Justice, Washington, for appellant. Robert L. Wright, appellees. Mr. Justice MARSHALL delivered opinion Court. In case we called upon review judgment Southern Mississippi require suppliers clubs, ship's stores, post exchanges various either jurisdiction State. 2 Prior 1966, prohibited sale possession alcoholic beverages its borders. year, passed local option beverage control law subject requirement sole importer wholesaler distributed State.1 was given authority act distributor licensed retailers 'including, at discretion Commission, retail distributors operating . boundaries State, exercising such distribution (seems) right proper keeping provisions purposes act.'2 conjunction these transactions retailers, directed 'add cost all markups will adequate cover operation business, yield reasonable profit, competitive prices neighboring states.'3 Under granted it by promulgated Regulation 254 gives exchanges, purchasing from directly distiller. However, insofar purchases made facilities, requires distiller latter's 'usual markup.' During period involved case, 17% 20% wine. 3 Four Mississippi—Keesler Air Force Base, Naval Construction Battalion Center, Columbus Meridian Station. stores—which run funds derived operations rather than appropriated States—on four had purchased outside Mississippi. Following passage law, elected continue practice supplies purchase Commission. Efforts were authorities convince activities, but efforts failed, compelled threat criminal prosecution delisting, is, withdrawal privilege selling retailing Mississippi.5 sought pay an escrow pending judicial determination legality applied purchases. But refused accept arrangement, order obtain suppliers, albeit protest.6 4 November 1969, seeking declaratory injunctive relief against continued enforcement 25, plus total amount paid through since complaint alleged Keesler Base exercise contended invalid because constituted attempt legislate respect facilities territory Congress legislative authority;7 impose instrumentalities thereby infringe Federal Government's immunity state taxation;8 interfere policy established Secretary Defense pursuant him Congress.9 also asked three-judge court convened. 5 On cross-motions summary judgment, ruled favor upholding challenged Regulation. 903 (S.D.Miss.1972). agreed two. concluded Congress' constitutional powers forces belonging 'are diminished express prohibition XXI packaged (1) exclusively enclaves without restriction use consumption liquors base, (2) take place installations government jurisdiction.' Id., 904. light conclusion found unnecessary import issued Defense. Nor discuss contention impermissible instrumentalities. appeal States, noted probable 409 1005, 437, 34 298 (1972).10 For reasons follow, now hold erred concluding provides sufficient support application jurisdiction,11 vacate remand consideration further arguments, relevant bases, reach. 6 * A. With claims Government places principal reliance Art. I, § 8, cl. 17, Constitution. That clause empowers 'exercise Legislation Places Consent Legislature Same shall be, Erection Forts, Magazines, Arsenals, dock-Yards, needful Buildings.' 7 Pacific Coast Dairy, Inc. Agriculture, 318 285, 63 628, 87 761 (1943), considered render ineffective California fix milk producers could sell Moffett Field, exercised 8 'When acquired tract (upon Field located), inconsistent remained force until altered national legislation. statute adopted long after transfer sovereignty enclave. It follows contracts consummated enclave cannot regulated law. To would affirm ignore Constitutional provision 'This Constitution, Laws Pursuance thereof; supreme Law Land; .' denial power 'to Legislation.' As respects combined general government.' 294, S.Ct., 630 (footnotes omitted). 9 view expressed Dairy reaffirmed Paul 371 245, 263 270, 83 426, 437—441, 292 (1963). There confronted another enforce minimum price three A portion purchased—as here issue—with resale exchanges. purchases, necessary determine regulatory scheme predated particular States,12 and, even if not, fact areas made. so doing emphasized '(t)he cases make clear grant 'exclusive' meet requirements own weight, bars specific congressional action.' 263, 437. 10 Were deal State's derive income liquor—a raises questions extent conferred possibility consent taxation—Pacific seem dispose Center concerned. See James Daravo Contracting 302 134, 140, 208, 212, 155 (1937); Standard Oil Co. California, 291 242, 54 381, 78 775 (1934). issue strictly between suppliers. goods ordered then Thus, initial delivery enclaves, nothing occurs transaction.13 Cf. Polar Ice Cream Creamery Andrews, 375 361, 382—383, 84 378, 390, 11 389 (1964); Penn Dairies, Milk Control Comm'n, 261, 617, 748 (1943). no question tracts land 'purchased Legislature' meaning 17. Despite ultimate resolution acknowledged bases. F.Supp., 904, 906. lands condemnation 1941 1950.14 And, throughout acqusition, expressly 'consent ., accordance 17th clause, 8th section, 1st article Constitution acquisition purchase, otherwise, custom houses, offices, public buildings,'15 only serve civil process lands.16 True, assent occupied final step 40 U.S.C. 255,17 series letters officials Governors 1942 1950.18 12 Accordingly, unless attempted revenue private decisive distinction, our prior attach Center. 13 B. contends—as held is sustainable basis broad Amendment. second section provides: 14 'The transportation Territory, therein intoxicating liquors, violation laws thereof, hereby prohibited.' 15 1502 (1938), concessionaire operated hotels, camps, stores National Park, contract Interior, enjoin Alcoholic Beverage Act limits Park. required apply permits related fees. ceded accepted, except reserved persons corporations 527—530, 1013 1015. determination, '(a)s there reservation beverages, Act'—namely, concerning permits—'are unenforceable Park.' 530, 1014. permit placed rejected argument, agreeing instead Court's 'that though increased 'the state's problem (of importation), increase jurisdiction." 538, 1018. went state: 16 'As territorial area merely account 'for therein.' distinct sovereignty. applicable.' Ibid. (Footnotes omitted.) 17 true, argues, sustain aspect decision bottomed specifically taxing cession id., 532, 536, 1016, 1017. 18 compel absent appropriate reservation—which lacking here—the confers licensing, taxation, otherwise—the Johnson Yellow Cab Transit 321 383, 64 622, 88 814 (1944). Certainly, intended free 'traditional Commerce limitations when restricts intoxicants destined use, distribution, borders.' Hostetter Idelewild Bon Voyage Liquor Corp., 377 324, 330, 1293, 1297, 350 (1964). Joseph E. Seagram Sons, Hostetter, 384 35, 42, 86 1254, 1259, 336 (1966). contends here, Collins, 'transportation liquor) (the) therein' therefore assist case. We agree. 19 one her sister states foreign land. They constitute islands longer part nor function control.' And recognized property onto thereon clearly ambit Amendment.' 906—907. limited situation restricted enclave, whereas undisputed facts show purpose being individuals their base surrounding state.' 907. Such off-base sufficient, view, think, however, unjustifiably narrowed Collins. 20 fact, indication concessionaire's always contrary, stated imported park premises where sold.'19 Hence, just assume ultimately Mississippi.20 Col lins Court, rejecting California's pointed, sure, 'delivery use' 'in Park,' U.,.s, But, reference transaction concessionaire. regulate, concerned, use—that delivery, storage, sale—of occurred stand different footing, thus, retained dispositive effort invoke transactions. 21 This suggest shipments while passing there. true mere 'shipment (Twenty-first) Amendment,' Carter Virginia, 131, 137, 464, 468, 605 (1944), may, absence regulation, properly police during prevent 'unlawful diversion' 'into internal commerce State,' see Idlewild U.S., 333, 331 n. 10, 1299; supra; Duckworth Arkansas, 314 62 311, 294 (1941). course remains restrict, 'destined consumption' borders, 1259; LaRue, 109, 114, 395, 342 (1972). 22 problems diversion need decide precise parameters before us. suffices note legitimate interest regulating effect extension involve land,' conclude give unintended scope designed augment territory, "increase jurisdiction," 23 C. Before asserts might 'tax' 1940, Stat. 1059, §§ 105—110. Section 105(a) part: 24 'No person relieved liability payment of, collection accounting levied duly therein, having levy tax, ground levied, whole Area ..' 105(a). 25 107(a) spells out certain exceptions contained Specifically, 'shall deemed authorize instrumentality thereof treated occurring 105(a), 110(b), so, exception nevertheless serves remove record reveals never considered, much less decided, Having think additional appropriately left first instance II 26 State—Columbus Station—present somewhat problems. Since located, unable rest Rather, argument theories unconstitutional States21 conflicts policy.22 Clause, implicitly declined taxation Instead, that, despite permitted simply reasoned '(a) fortiori, governments jurisdiction—Meridian Columbus—are similarly law.' 27 rationale adopting entirely clear. Certainly correct observed 'as confines base.' already noted, purport involving clause. ruling empowered enclaves. Our eliminates essential premise While arguments rely those present, decide, believe useful views allow arguments. Lewis Martin, 397 552, 560, 90 1282, 1286, 561 (1970); FCC WJR, 337 265, 69 1097, 1108, 1353 (1949). 28 remanded proceedings consistent opinion. 29 ordered. 30 Judgment 31 DOUGLAS, whom REHNQUIST concurs, dissenting. 32 amazing irreparable harm cause States' rights pervasive violation' laws. they transported across obviously used 33 Two posts inland Mississippi's coastline. latter water vessel must enter waters. Skiriotes Florida, 313 69, 61 924, 85.l.Ed. 1193, waters domain coastal These into' liquors' bar certainly includes manage done more that. So seems me classic example basic so-called monopoly State,1 like States. Some themselves wholesaler2 wine retailer well. makes itself wholesaler. litigation members Armed Services 35 (hereafter exchanges) direct commission. provides, 'All orders organizations bear usual markup3 exempt taxes.' wine, 20%. If distiller, remits who fails refuses observe conditions deprived benefits prosecuted. 36 suit district business terms relying Amendment,4 gave appellees 903. Its affirmed. dispute met, say, liquors.' 38 resold Services, retired families members; guests retirees families. said, area. 39 Private $2.50 gallon spirits. Post Exchanges resales; stipulated each profit. Universal Military Training Service amended 1951, authorizes 'governing sale, consumption, traffic members' Forces 'at near camp, station, post, primarily (them)' 50 U.S.C.App. 473. criminal, knowing violations regulations. Department Directive 1330.15 May 1964, 9, camp manner most advantageous contract, factors considered.' do face override displace liquor. immaterial. 41 Solicitor General relies dock-yards, provision, Reliance 263—268, 437—440, 292. provided regulations; 'by 42 parts same 350, (id., 1296), prohibit consumers countries. enacted governing nations; trade. Hence argued preempts power. 'transportation' beyond it. 43 regime supervise said: 44 Where 45 observation apt, undertook assert park. presses present Yet dispensing collects ship Those shipments, 46 Moreover, legal incidence only. economic course, barrier result. 47 phase decided covered decisions factfindings resolution. 48 At least Alabama King Boozer, 1, 43, 3, cost-plus forced treasury.5 principle king Boozer distillers, 105 seq., exchange area.' exempts taxes, sales, personal 'any authorized purchaser' (s 107), defined commissaries, like, departmental Secretary. 49 thereof.' 107(a). wholesalers worst tax. 'levy collection' technical, sense. paying indirectly taxation. 51 alone distinguish 292, inoperative words all. sum plainly, therefore, my Act. concedes his brief meant raise revenue.' By reason matters Paul, Here, 'economic' burden solely distributor. 52 First Agricultural Bank 392 339, 2173, 1138, inapposite. ways banks, apart real estate. 341—342, 2174—2175. broader defeated Congress. Because history, read Massachusetts closely "recoverable law" bank, 347, 2177, transcended waiver immunity. 53 reasons. First, incidence. 55 Second, relation involves importation' plenary control. completely admit she chooses. arise. including costs contracts. 56 instrumentalities—which holds exchanges—King allows who, 1941, modern version intergovernmental immunity.6 fours excise imposed Florida turn referring 57 'We ample measured distributes monthly, Florida.' 391, 389. below Miss.Code Ann. 10265—01 seq. (Supp. 1972). 10265—18(c). 10265—106. Regulation, originally numbered 22, reads follows: 'Post reservations personnel (including Guard) ordering Division event organization copy immediately mailed taxes. monthly covering previous month.' Stipulation Facts, (hereinafter Stipulation) App. 36—38. Out-of-state $648,421.92 protest July 31, 1971. U.S.Const., cls. IV, 3. See, e.g., McCulloch Maryland, Wheat. 316, 579 (1819). CFR 261.4(c). 249—250, 430, special concurring opinion, Judge Cox added recoupment sums barred because, payments voluntarily activities. 909. voluntary knowingly illegal demand, recovery denied. New York Cuba Mail S.S. 200 488, 493 494, 327, 329—330, 569 (1906); Little Bowers, 134 547, 554, 620, 621, 1016 (1890); Railroad Commissioners, 98 541, 543—544, 196 (1879). here. arrangement severe sanctions anyone failed charge resulting non-appropriated choice markup—either suppliers—in else cease altogether—that discontinue entire line business. Obviously, obtained coercion; protest; thus hardly said voluntary. Ward Board County Comm'rs Love County, 253 23, 419, 421, 751 (1920); Atchison, T. S.F.R. O'Connor, 223 280, 286—287, 216, 217, 436 (1912); Oceanic Steam Navigation Stranahan, 214 320, 329, 671, 672, (1909); Swift 111 28—29, 244, 247, 341 (1884). command every vestige former vanish. contrary language interpreted continuance abrogated rules existing time surrender govern occupants transferred. assures however small developed system rights.' Stewart Sadrakula, 309 94, 99—100, 60 431, 433, 596 (1940). Argiculture, 630, (1943); Murray Joe Gerrick 315, 318, 432, 821 (1934); Chicago, R.I. P.R. McGlinn, 114 542, 546—547, 1007, 270 (1885). back question, infra, 377—378. Stipulation, Ex. 1—7. well acquires 'purchased' 264, 437; Humble Pipe Line Waggonner, 376 369, 371—372, 857, 859, 782 4153. statutes uncommon, supra, 265 438; Dravo 143 213, (1937), effective acquisition, 268—269, 439—440. 4154. effectiveness qualifications see, 264—265, 437 146—149, 214—216. 255 'Notwithstanding obtaining interests hereafter required; head officer department independent establishment agency times he deem desirable, secure immediate custody, situated, partial, theretofore obtained, desirable indicate acceptance behalf filing notice Governor prescribed situated. Unless accepted aforesaid, conclusively presumed accepted.' became predates sovereign authority, 12, supra. Transcript Record, 870, O.T. 1937, p. contains inferred 'numerous classes non purchases; facility exacts promise purchaser obey bought taken installation.' 905. parity reasoning likelihood ever greater open large. 253, 432. Wholesaler person, manufacturer, engaged distributing purchaser.' 10265—05(g). 10265—106, add states.' 2, 326 572, 66 310, 326, discussing mineral waters, stated, 'In older cases, emphasis tendency recent shift limitation awareness role courts assessing relative weight based.' 581, 314. trend Esso Evans, 345 495, 73 800, 97 1174, Esso, occasioned storage gasoline owned shown contractual obligated reimburse contractor incurred. distinguished federally indicating storing property. City Detroit, 355 466, 474, 424, Muskegon, 484, 483, 436, concerned 1953 Michigan providing tax-exempt conducted profit owner Both contractors occupying defense plants, lease terminated will. saying violated discriminatory discriminatorily administered. result reached notwithstanding years reimbursed possessory Detroit Corp. America, 489, 458, 461, 441, Murray, subcontractor, work inventory, title day. impediment permitting possessory-interest Government-owned Unlike situation, statute, levying commenting disparity statutes, 'It taxed using possessing' property, strike down possessor verbal omission prove victory empty formalisms. formalisms too shadowy invalidating circumstances obviate grounds invalidity adding few statutes.' 493, 461. third century doctrine immunity, applies allegedly governmental highly expansive phase. Among following: articles Government, Panhandle 277 218, 451, 72 857; earnings patents copyrights, Long Rockwood, 142, 463, 824; lessees lands, Gillespie Oklahoma, 257 501, 171, 338. time, number inroads established. valid corporate franchise bonds, Flint Stone Tracy 220 107, 342, 389, inheritance estate Plummer Coler, 178 115, 829, 998; Income capital gain Willcuts Bunn, 282 125, 75 304; net Metcalf Eddy Mitchell, 269 514, 172, 70 384. culminated led commentator note, 'Today, conducts vast parties. Supreme reject immunizing parties nondiscriminatory matter bears brunt instance, inclusion price, many instances, reimbursement item cost.' Rollman, Recent Developments Sovereign Immunity Loca Taxes, N.D.L.Rev. 26, 30.

Category: 9