Exploring the “Myth of Parity” in State Taxation: State Court Decisions Interpreting Public Law 86—272

Abstract

Although several scholars have explored the question of parity between federal and state courts in a variety of other contexts, the empirical question whether state courts are systematically biased against taxpayers seeking the protection of federal law has gone largely unexamined. This Essay offers a preliminary exploration of that issue. Specifically, it presents a study of all reported state court decisions interpreting Public Law 86–272, a federal statute enacted in 1959 that provides businesses with immunity from state income taxes when they keep their activities in the taxing state beneath a specific threshold. State court decisions interpreting Public Law 86–272 may provide a means for measuring systemic bias.

Keywords

Income tax -- United States -- States, Intergovernmental tax relations, Law -- Interpretation & construction -- United States -- States, Federal jurisdiction

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Bradley W. Joondeph (Washington University School of Law)

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