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Brown-Forman Distillers Corp. v. Collector of Revenue, 234 La. 651, 101 So.2d 70

Facts

The appellant, a Kentucky corporation, engaged solely in interstate commerce, distills and packages whiskies in Louisville, Kentucky, and distributes them across the United States. It ships goods to Louisiana customers based on orders submitted by local representatives who do not solicit orders from retail dealers. The corporation argued that it should not be subject to Louisiana income tax as its activities in the state were limited and did not constitute a taxable presence.

The appellant, a Kentucky corporation, engaged solely in interstate commerce, distills and packages whiskies in Louisville, Kentucky, and distributes them across the United States.

Issue

Did the imposition of state income tax on the income earned by a Kentucky corporation from its activities in Louisiana violate the commerce clause of the federal Constitution?

Did the imposition of state income tax on the income earned by a Kentucky corporation from its activities in Louisiana violate the commerce clause of the federal Constitution?

Rule

A foreign corporation engaged exclusively in interstate commerce is not exempt from state taxes assessed on net income derived from sources within the state.

A foreign corporation engaged exclusively in interstate commerce is not exempt from state taxes assessed on net income derived from sources within the state.

Analysis

The court analyzed the facts presented by the appellant and determined that the corporation's activities in Louisiana, although limited, still generated income from sources within the state. The court referenced previous rulings that established that a tax on net income from interstate commerce does not conflict with the commerce clause, thereby affirming the legality of the tax imposed.

The court analyzed the facts presented by the appellant and determined that the corporation's activities in Louisiana, although limited, still generated income from sources within the state.

Conclusion

The court affirmed the trial court's ruling, concluding that the Kentucky corporation was subject to Louisiana income tax based on its income derived from sources within the state.

The court affirmed the trial court's ruling, concluding that the Kentucky corporation was subject to Louisiana income tax based on its income derived from sources within the state.

Who won?

Collector of Revenue; the court ruled in favor of the Collector, stating that the corporation's activities constituted a taxable presence in Louisiana.

Collector of Revenue; the court ruled in favor of the Collector, stating that the corporation's activities constituted a taxable presence in Louisiana.

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