States Unbound: Examining the Authority of the Multistate Tax Compact in a Modern, Multijurisdictional Economy
Wayne State University Journal of Business Law, 2018
44 Pages Posted: 3 Sep 2018
Date Written: August 9, 2016
Recent decisions from the high courts of several states have brought attention to a meaningful tension in the goals of the Multistate Tax Compact, an agreement between states. Though the federal government has ruled that no congressional approval is necessary based on the Compact Clause of the U.S. Constitution, this agreement between states has taken its place as an important accord among the vast majority of jurisdictions. Having operated as the most effective solution to the problems identified by Congress in the 1960’s Willis Report, the Compact simultaneously disavows its binding authority and relies on the reliance of States on it to meet its goal of promoting uniformity in state tax administration. With billions of dollars of much needed tax revenue at issue, this article seeks to examine the intricacies of the legal principles applied to this contract among states while understanding its role in the modern economy.
Keywords: State and Local Tax, Multistate Tax Compact, Compact Clause, Tax
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