ASSOCIATED INDUSTRIES OF MISSOURI v. LOHMAN

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Case Basics
Docket No. 
93-397
Petitioner 
Associated Industries of Missouri
Respondent 
Lohman
Advocates
(Argued the cause for the respondents)
(Argued the cause for the petitioners)
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Facts of the Case 

Following Missouri's imposition of a 1.5% statewide "use tax," the Associated Industries of Missouri - representing Missouri businesses that had to collect the tax and a manufacturing firm that had to pay it - filed suit alleging that the tax violated the Commerce Clause by discriminating against interstate commerce. Such discrimination was said to result from the fact that the use tax exceeded many in-state localities' sales tax rate.

Question 

Does Missouri's use tax violate the Commerce Clause by discriminating against interstate commerce in those localities where the use tax exceeds the local sales tax?

Conclusion 
Decision: 9 votes for Associated Industries of Missouri, 0 vote(s) against
Legal provision: Article 1, Section 8, Paragraph 3: Interstate Commerce Clause

Yes. The Court held that the use tax was discriminatory in those localities where it exceeded the local sales tax. Such discrepancies, between certain localities' sales taxes and the state use tax, prevented the latter tax from being a valid "compensatory" tax, since it obviously did not impose a "substantially similar" burden on the interstate and intrastate commerce of such localities. The Court added that in those localities where the use tax did not exceed the local sales tax, no discriminatory treatment resulted and so the use tax's application would not be struck down in its entirety. Instead, the Court remanded the case back to Missouri for a decision on how to best correct certain of its localities' existing tax discrepancies.

Cite this Page
ASSOCIATED INDUSTRIES OF MISSOURI v. LOHMAN. The Oyez Project at IIT Chicago-Kent College of Law. 14 December 2014. <http://www.oyez.org/cases/1990-1999/1993/1993_93_397>.
ASSOCIATED INDUSTRIES OF MISSOURI v. LOHMAN, The Oyez Project at IIT Chicago-Kent College of Law, http://www.oyez.org/cases/1990-1999/1993/1993_93_397 (last visited December 14, 2014).
"ASSOCIATED INDUSTRIES OF MISSOURI v. LOHMAN," The Oyez Project at IIT Chicago-Kent College of Law, accessed December 14, 2014, http://www.oyez.org/cases/1990-1999/1993/1993_93_397.