A Unifying Approach to Nexus Under the Dormant Commerce Clause
20 Pages Posted: 26 Feb 2018
Date Written: February 12, 2018
The Supreme Court recently granted certiorari in South Dakota v. Wayfair, a case questioning the ongoing validity of the Court’s 1992 decision in Quill Corporation v. North Dakota. The particular question presented in the cert petition was whether Quill’s physical-presence rule should be overruled, but resolution of that question will force the Court to confront its approach to the dormant Commerce Clause more generally. This is an issue that has not yet been addressed in the literature. Tax scholars have critiqued the physical-presence rule for decades, but have not addressed the question of what the Court would do post-Quill or how that question relates to, or would be influenced by, the Court’s non-tax dormant Commerce Clause doctrine.
This essay takes on that task and evaluates the potential options for the Court if it were to reverse Quill. It concludes that the best approach for the Court post-Quill would be to completely eliminate any special nexus requirement under the dormant Commerce Clause. That approach might seem drastic, but it is the option that would best balance the Court’s interests in protecting our common national market and state autonomy while limiting its own role as an arbiter of the complex economic and political interests involved in balancing those two divergent goals.
Keywords: tax, state tax, nexus, Quill, Wayfair, economic nexus
JEL Classification: H25, K34, E62, H77
Suggested Citation: Suggested Citation