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NIPPERT V. RICHMOND, 327 U. S. 416 (1946)

U.S. Supreme Court

Nippert v. Richmond, 327 U.S. 416 (1946)

Nippert v. Richmond

No. 72

Argued November 8, 1945

Decided February 25, 1946

327 U.S. 416


1. A municipal ordinance imposed upon persons "engaged in business as solicitors" an annual license tax of "$50.00 and one-half of one percentum of the gross earnings, receipts, fees, or commissions for the preceding license year in excess of $1,000." A permit from the Director of Public Safety was a prerequisite to issuance of the license, and violators were subject to criminal penalties. Upon a record which showed that appellant had been soliciting in the city for five days, without a license, orders for out-of-state confirmation and shipment into the State, appellant was convicted and fined.

Held that the ordinance as so applied violated the commerce clause of the Federal Constitution. Pp. 327 U. S. 417, 327 U. S. 434.

2. Robbins v. Shelby County Taxing Dist., 120 U. S. 489, and later cases, followed; McGoldrick v. Berwind-White Co., 309 U. S. 33, distinguished. Pp. 327 U. S. 417-418, 327 U. S. 420.

3. The tax here cannot be sustained as one upon the "local incident" of "solicitation." Whether a "local incident" related to or affecting interstate commerce may be made the subject of state taxation depends upon considerations of constitutional policy having reference to the substantial effects, actual or potential, of the particular tax in suppressing or burdening commerce unduly. Pp. 327 U. S. 422-424.

4. The effects of the tax here in question are not only prohibitive in an absolute sense, in many applications, but are discriminatory in favor of the local merchant as against the out-of-state one. P. 327 U. S. 431.

(a) The ordinance is not saved by the fact that it is neither prohibitive nor discriminatory on its face, nor by the fact that it is applicable also to all local distributors operating similarly. P. 327 U. S. 431.

Page 327 U. S. 417

(b) The very difference between interstate and local trade, taken in conjunction with the inherent character of the tax, makes equality of application as between those two classes of commerce, generally speaking, impossible. P. 327 U. S. 432.

5. Local governments may not impose a tax which, though applicable to all commerce, strikes down or discriminates against large volumes of that commerce, in order to reach other portions as to which the application of the tax would produce no such consequences or only negligible ones. P. 327 U. S. 433.

6. The tax here in question involves too many probabilities and actualities for exclusion of or discrimination against interstate commerce in favor of local competing business to be sustained in any such application as that given it in this case. P. 327 U. S. 434.

183 Va. 689, 33 S.E.2d 206, reversed.

Appeal from a Judgment which affirmed a conviction for violation of a municipal ordinance imposing a license tax. Reversed, p. 327 U. S. 435.

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