Henneford v. Silas Mason Co.

300 U.S. 577, 57 S. Ct. 524 (1937)



Things acquired or transported in interstate commerce may be subjected to a property tax, non-discriminatory in its operation, when they have become part of the common mass of property within the state of destination. This is so, indeed, though they are still in the original packages. For like reasons they may be subjected, when once they are at rest, to a non-discriminatory tax upon use or enjoyment. The privilege of use is only one attribute, among many, of the bundle of privileges that make up property or ownership. A state is at liberty, if it pleases, to tax them all collectively, or to separate the faggots and lay the charge distributively. Calling the tax an excise when it is laid solely upon the use does not make the power to impose it less, for anything the commerce clause has to say of its validity, than calling it a property tax and laying it on ownership. A nondiscriminatory tax upon local sales has never been regarded as imposing a direct burden upon interstate commerce and has no greater or different effect upon that commerce than a general property tax to which all those enjoying the protection of the state may be subjected. A tax upon the privilege of use or storage when the chattel used or stored has ceased to be in transit is now an impost so common that its validity has been withdrawn from the arena of debate.


The taxpayers were contractors and subcontractors in the construction of a dam, during the construction of which they brought into the State of Washington machinery, materials, and supplies that were bought at retail in other states. The Commission informed the taxpayers that they were subject, through the use of this property, to a use tax pursuant to 1935 Wash. Laws 180. The taxpayers filed the instant action on the ground that the tax violated the Commerce Clause as a tax on interstate commerce or a discrimination against such commerce obstructing or burdening it unlawfully, and the district court agreed holding unconstitutional a tax on the use of chattels bought in other states.


Is a tax on the use of chattels bought in other states unconstitutional?




The United States Supreme Court held that 1) the tax was not upon the operations of interstate commerce, but upon the privilege of use after commerce was at an end; and 2) the tax upon the use after the property was at rest was not so measured or conditioned as to hamper the transactions of interstate commerce or discriminate against them. The Court further noted that the legislature could make the tax base as broad or as narrow as it pleased, and such questions of fiscal policy were not for the Court to decide.

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