Free Republic

New Jersey’s shakedown tactics have spread. California, Massachusetts, New York, Pennsylvania, Illinois, Nebraska, and Virginia have been among the states named in congressional testimony for trying to levy corporate taxes on firms whose only substantial connection is a visiting truck. In one typical case, when a small Milwaukee transportation firm, LTL Trucking, answered a Nebraska tax questionnaire by acknowledging that its trucks had driven through the state in recent years, it received a back-tax bill of $1,321, despite having no inventory, customers, or sales there. Manufacturers delivering products to customers in locations where the firms don’t otherwise operate have found...

Cash-hungry governments are shaking down nonresident businesses and workers.Revenue-hunting states have lately gone beyond raising their own taxes; now they’re trying to shake down firms and workers in other states. Stretching the limits of the U.S. Constitution’s Commerce Clause to the breaking point, local revenue agents have seized out-of-state trucks simply passing through their jurisdiction, refusing to release them until the firms that dispatched them fork over corporate income taxes. Finance departments have slapped out-of-state businesses with bills for thousands of dollars in corporate back taxes, based on little more than a single worker visiting the state sometime during the...