General Concepts

Question 1

Contract Clause

Answer 1

The Contract clause limits the ability of states to enact laws that retroactively impair contract rights.

Not applicable to the Federal Government

Question 2

Transaction Tax

Answer 2

A transaction tax is constitutional if 1) it does not discriminate against interstate commerce 2) the activity taxed has a substantial nexus to the taxing state, 3) the tax is fairly apportioned and 4) the tax fairly relates to the services provided by the taxing state

Question 3

Article IV Privileges and Immunities

Answer 3

The Interstate Privileges and Immunities Clause of Article IV prohibits discrimination by a state against nonresidents with respect to fundamental rights

Exception: The state law may be valid if the state has a substantial justification for the different treatment. State must show that there are no less restrictive means to solve the problem.