Court Opinion

ID: 9517912
Source: CourtListenerOpinion
Date Created: 2023-08-07 00:36:42.826032+00
Date Added: 2024-06-11T12:25:49.960636
License: Public Domain

FARRELL, Associate Judge,
concurring:
I join the court’s opinion entirely and write only to express my view that the internal consistency principle, as a test for identifying forbidden commerce clause discrimination outside the fair apportionment context, should be reexamined. The reasons are essentially those stated by Justice Scalia in part I of his dissent in Tyler Pipe. See particularly 483 U.S. at 257-58, 107 S.Ct. at 2825. As applied here, the internal consistency rule says in effect that, for the District of Columbia constitutionally to adopt the means it has for preventing double taxation of local telecommunications carriers, it must provide credits enabling carriers in many instances to escape any local taxation based on property located or business conducted in the District. Consider, for example, the carrier having property here that is used to generate telephone charges billable to an address outside the District. Those receipts fall outside the District’s telecommunications tax on gross receipts; yet because another state hypothetically might capture them under its similar tax, the District must go further and exempt those receipts from the reach of its personal property or use taxes as well — either that or it must eliminate the exemption relieving locals from paying double taxes (personal property and gross receipts) based on a single transaction. I claim i}0 expertise in commerce clause analysis, but this seems to me unnecessarily formalistic1 and hard to justify by any generalized fear of balkanization of our nation’s tax laws. Before the District must refund the potentially millions of dollars at stake here, it deserves a better explanation than Tyler Pipe provides for the invalidity of its tax scheme.

. The Court has said, after all, that there is nothing unconstitutional about "fair encouragement of in-state business," Armco, Inc., 467 U.S. at 645, 104 S.Ct. at 2624, of which avoidance of double taxation would seem a prime illustration.