States Powers Flashcards
10th A
Powers not reserved for federal nor prohibited are reserved for the state.
Only states have police power.
Dormant commerce clause
States can regulate interstate commerce on areas where congress has not acted.
Prohibited state activities
- Make foreign treaties
- Coin money
- Pass bill of attainder
- Pass ex post facto law
- Lay duty on imports or exports except for inspection
- Engaging in war
- Maintain peacetime army.
Discrimination between in state and out of state commerce
If law discriminates on its face, then state must show there is a compelling state interest and reg is narrowly tailored to serve that interest.
If law merely burdens interstate commerce, then reg must serve an important state interest and burden can be excessive in relation to that interest.
Exception when states act assert participants.
Sales tax
Taxed by the state where the goods are sold, not state delivered to.
State tax of interstate commerce
Permissible if does not discriminate or unduly burden. Consider:
- Must be substantial nexus between activity taxed and taxing state,
- Tax must be fairly apportioned,
- Tax must not discriminate against interstate commerce, and
- Tax must be fairly related to the services provided by the taxing state.
Use tax
Seller who maintains offices in the state has sufficient nexus to be subject to use tax.
Doing business tax
Must relate to the benefits conferred by the taxing state.
Aka occupation, license, privilege, net or gross receipts tax.
Net income tax
Applied to business doing business in the state.
Must be fairly apportioned, significant nexus, and non discriminatory.
License fee/tax
Only valid applied to person who sells and delivers products within the state.
* Not to person who solicits orders in the state, but fills and ships then from different state.
