Complete Auto test in New York

1999Moreover, plaintiffs acknowledge that “there is almost a perfect correlation between the use of the road and the amount of the tax paid.” (Plaintiffs’ Mem of Law in Opposition, at 15.) “[W]hen the measure of a tax is reasonably related to the taxpayer’s activities or presence in the State — from which it derives some benefit * * * the taxpayer will realize, in proper proportion to the taxes it pays * * * [the benefit] ‘of living in an organized society, established and safeguarded by the devotion of taxes to public purposes.’ ” (Commonwealth Edison Co. v Montana, 453 US 609, 628-629 [1981], qu

1993(American Trucking Assns. v Scheiner, 483 US 266 [1987] [Pennsylvania’s flat tax on trucks which used its highways violated the Commerce Clause because a disproportionate burden was imposed on interstate trucks which annually travelled fewer miles on Pennsylvania’s highways than did intrastate trucks].) Out-of-State users who seldom, if ever, use their pagers in New York, are subjected to the same amount of tax as is paid by intrastate users. "[W]hen the measure of tax bears no relationship to the taxpayers’ presence or activities in a State, a court may properly conclude * * * that the State

2024Under the Complete Auto test, a tax is constitutional if it: (1) “is applied to an activity with a substantial nexus with the taxing State”; - 11 - - 12 - Nos. 34 & 35 (2) “is fairly apportioned”; (3) “does not discriminate against interstate commerce”; (4) “is fairly related to the services provided by the State” (Complete Auto Tr., Inc. v Brady, 430 US 274, 279 [1977]).

1998Thus, contrary to the dissent’s contention, the first step in the dormant Commerce Clause inquiry is not simply to apply the so-called Complete Auto test (Complete Auto Tr. v Brady, 430 US 274 ), including its “internal consistency” requirement (Container Corp. v Franchise Tax Bd., supra). 8 Rather, the first step is to identify the interstate market that is being subjected to discriminatory or unduly burdensome taxation. 9 This requires, at the outset, identification of the similarly situated in-State and out-of-State interests which the tax treats differently.

1998Petitioners argue, and the dissent agrees, that the tax violates the Complete Auto test because it is not “ ‘internally consistent’ ” (dissenting opn, at 548 [citing Container Corp. v Franchise Tax Bd., 463 US 159, 169 , supra; Goldberg v Sweet, 488 US 252, 261 ]).

1998Petitioners argue, and the dissent agrees, that the tax violates the Complete Auto test because it is not “ ‘internally consistent’ ” (dissenting opn, at 548 [citing Container Corp. v Franchise Tax Bd., 463 US 159, 169 , supra; Goldberg v Sweet, 488 US 252, 261 ]).

1999Moreover, plaintiffs acknowledge that “there is almost a perfect correlation between the use of the road and the amount of the tax paid.” (Plaintiffs’ Mem of Law in Opposition, at 15.) “[W]hen the measure of a tax is reasonably related to the taxpayer’s activities or presence in the State — from which it derives some benefit * * * the taxpayer will realize, in proper proportion to the taxes it pays * * * [the benefit] ‘of living in an organized society, established and safeguarded by the devotion of taxes to public purposes.’ ” (Commonwealth Edison Co. v Montana, 453 US 609, 628-629 [1981], qu

1999(See, Holmes Co. v McNamara, 486 US 24, 32 [1988] [provision of police and fire protection, together with other civic services, satisfied Complete Auto test].) Plaintiffs derive a substantial benefit from the State for the use of its highway system; the tolls paid for the use of the Thruway do not cover these additional benefits and expenses to the State.

1999(See, Holmes Co. v McNamara, 486 US 24, 32 [1988] [provision of police and fire protection, together with other civic services, satisfied Complete Auto test].) Plaintiffs derive a substantial benefit from the State for the use of its highway system; the tolls paid for the use of the Thruway do not cover these additional benefits and expenses to the State.