The Taxing and Spending Clause
Restriction of State Revenue Power
Michelin Tire Corp v. Wages (1976)
423 U.S. 276 (1976)
Vote: 8-0
Majority: Brennan, joined by Burger, Stewart, Marshall, Blackmun, Powell, and Rehnquist
Concur: White
Not participating: Stevens
MR. JUSTICE BRENNAN delivered the opinion of the Court.
Respondents, the Tax Commissioner and Tax Assessors of Gwinnett County, Ga. assessed ad valorem property taxes against tires and tubes imported by petitioner from France and Nova Scotia that were included on the assessment dates in an inventory maintained at its wholesale distribution warehouse in the county. Petitioner brought this action for declaratory and injunctive relief in the Superior Court of Gwinnett County, alleging that, with the exception of certain passenger tubes that had been removed from the original shipping cartons, the ad valorem property taxes assessed against its inventory of imported tires and tubes were prohibited by Art. I, § 10, cl. 2, of the Constitution, which provides in pertinent part:
“No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws. … ”
Petitioner, a New York corporation qualified to do business in Georgia, operates as an importer and wholesale distributor in the United States of automobile and truck tires and tubes manufactured in France and Nova Scotia by Michelin Tires, Ltd …
The imported tires, each of which has its own serial number, are packed in bulk into the trailers and vans, without otherwise being packaged or bundled. They lose their identity as a unit, however, when unloaded from the trailers and vans at the distribution warehouse. When unloaded, they are sorted by size and style, without segregation by place of manufacture, stacked on wooden pallets each bearing four stacks of five tires of the same size and style, and stored in pallet stacks of three pallets each. This is the only processing required or performed to ready the tires for sale and delivery to the franchised dealers …
Both Georgia courts addressed the question whether, without regard to whether the imported tires had lost their character as imports, Georgia’s nondiscriminatory ad valorem tax fell within the constitutional prohibition against the laying by States of “any Imposts or Duties on Imports. … ” The Superior Court expressed strong doubts that the ad valorem tax fell within the prohibition, but concluded that it was bound by this Court’s decisions to the contrary …
Our independent study persuades us that a nondiscriminatory ad valorem property tax is not the type of state exaction which the Framers of the Constitution … had in mind as being an “impost” or “duty … ”
The Framers of the Constitution … sought to alleviate three main concerns by committing sole power to lay imposts and duties on imports in the Federal Government, with no concurrent state power: the Federal Government must speak with o