Comptroller of Treasury of Maryland v. Wynne

NOTICE: This opinion is subject to
formal revision before publication in the preliminary print of the
United States Reports. Readers are requested to notify the Reporter
of Decisions, Supreme Court of the United States, Washington,
D. C. 20543, of any typographical or other formal errors, in
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															SUPREME COURT OF THE UNITED STATES

															_________________

															No. 13–485

															_________________

															COMPTROLLER OF THE TREASURY OF
MARYLAND,PETITIONER v. BRIAN WYNNE et ux.

															on writ of certiorari to the court of appeals
of maryland

															[May 18, 2015]

															Justice Alito delivered the opinion of the
Court.

															This case involves the constitutionality of an
unusual feature of Maryland’s personal income tax scheme. Like many
other States, Maryland taxes the income its residents earn both
within and outside the State, as well as the income that
nonresidents earn from sources within Maryland. But unlike most
other States, Maryland does not offer its residents a full credit
against the income taxes that they pay to other States. The effect
of this scheme is that some of the income earned by Maryland
residents outside the State is taxed twice. Maryland’s scheme
creates an incentive for taxpayers to opt for intrastate rather
than interstate economic activity.

															We have long held that States cannot subject
corporate income to tax schemes similar to Maryland’s, and we see
no reason why income earned by individuals should be treated less
favorably. Maryland admits that its law has the same economic
effect as a state tariff, the quintessential evil targeted by the
dormant Commerce Clause. We therefore affirm the decision of
Maryland’s highest court and hold that this feature of the State’s
tax scheme vio-lates the Federal Constitution.

															I

															Maryland, like most States, raises revenue in
part by levying a personal income tax. The income tax that Maryland
imposes upon its own residents has two parts: a “state” income tax,
which is set at a graduated rate, Md. Tax-Gen. Code Ann. §10–105(a)
(Supp. 2014), and a so-called “county” income tax, which is set at
a rate that varies by county but is capped at 3.2%, §§10–103,
10–106 (2010). Despite the names that Maryland has assigned to
these taxes, both are State taxes, and both are collected by the
State’s Comptroller of the Treasury. Frey v. Comptroller
of Treasury , 422 Md. 111, 125, 141–142, 29 A. 3d 475, 483, 492
(2011). Of course, some Maryland residents earn income in other
States, and some of those States also tax this income. If Maryland
residents pay income tax to another jurisdiction for income earned
there, Maryland allows them a credit against the “state” tax but
not the “county” tax. §10–703; 431 Md. 147, 156–157, 64 A. 3d 453,
458 (2013) (case below). As a result, part of the income that a
Maryland resident earns outside the State may be taxed twice.

															Maryland also taxes the income of nonresidents.
This tax has two parts. First, nonresidents must pay the “state”
income tax on all the income that they earn from sources within
Maryland. §§10–105(d) (Supp. 2014), 10–210 (2010). Second,
nonresidents not subject to the county tax must pay a “special
nonresident tax” in lieu of the “county” tax. §10–106.1; Frey , supra , at 125–126, 29 A. 3d, at 483. The
“special nonresident tax” is levied on income earned from sources
within Maryland, and its rate is “equal to the lowest county income
tax rate set by any Maryland county.” §10–106.1. Maryland does not
tax the income that nonresidents earn from sources outside
Maryland. See §10–210.

															Respondents Brian and Karen Wynne are Maryland
residents. In 2006, the relevant tax year, Brian Wynne owned stock
in Maxim Healthcare Services, Inc., a Subchapter S
corporation.[ 1 ] That year,
Maxim earned income in States other than Maryland, and it filed
state income tax returns in 39 States. The Wynnes earned income
passed through to them from Maxim. On their 2006 Mary-land tax
return, the Wynnes claimed an income tax credit for income taxes
paid to other States.

															Petitioner, the Maryland State Comptroller of
the Treasury, denied this claim and assessed a tax deficiency. In
accordance with Maryland law, the Comptroller allowed the Wynnes a
credit against their Maryland “state” income tax but not against
their “county” income tax. The Hearings and Appeals Section of the
Comptroller’s Office slightly modified the assessment but otherwise
affirmed. The Maryland Tax Court also affirmed, but the Circuit
Court for Howard County reversed on the ground that Maryland’s tax
system violated the Commerce Clause.

															The Court of Appeals of Maryland affirmed. 431
Md. 147, 64 A. 3d 453. That court evaluated the tax under the
four-part test of Complete Auto Transit, Inc. v. Brady , 430 U. S. 274 (1977), which asks whether a “tax
is applied to an activity with a substantial nexus with the taxing
State, is fairly apportioned, does not discriminate against
interstate commerce, and is fairly related to the services provided
by the State.” Id., at 279. The Court of Appeals held that
the tax failed both the fair apportionment and nondiscrimination
parts of the Complete Auto test. With respect to fair
apportionment, the court first held that the tax failed the
“internal consistency” test because if every State adopted
Maryland’s tax scheme, interstate commerce would be taxed at a
higher rate than intrastate commerce. It then held that the tax
failed the “external consistency” test because it created a risk of
multiple taxation. With respect to nondiscrimination, the court
held that the tax discriminated against interstate commerce because
it denied residents a credit on income taxes paid to other States
and so taxed income earned interstate at a rate higher than income
earned intrastate. The court thus concluded that Maryland’s tax
scheme was unconstitutional insofar as it denied the Wynnes a
credit against the “county” tax for income taxes they paid to other
States. Two judges dissented and argued that the tax did not
violate the Commerce Clause. The Court of Appeals later issued a
brief clarification that “[a] state may avoid discrimination
against interstate commerce by providing a tax credit, or some
other method of apportionment, to avoid discriminating against
interstate commerce in violation of the dormant Commerce Clause.”
431 Md., at 189, 64 A. 3d at 478.

															We granted certiorari. 572 U. S. ___
(2014).

															II

															A

															The Commerce Clause grants Congress power to
“regulate Commerce . . . among the several States.”
Art. I, § 8, cl. 3. These “few simple words
. . . reflected a central concern of the Framers that was
an immediate reason for calling the Constitutional Convention: the
conviction that in order to succeed, the new Union would have to
avoid the tendencies toward economic Balkanization that had plagued
relations among the Colonies and later among the States under the
Articles of Confederation.” Hughes v. Oklahoma , 441
U. S. 322 –326 (1979). Although the Clause is framed as a
positive grant of power to Congress, “we have consistently held
this language to contain a further, negative command, known as the
dormant Commerce Clause, prohibiting certain state taxation even
when Congress has failed to legislate on the subject.” Oklahoma
Tax Comm’n v. Jefferson Lines, Inc. , 514 U. S. 175,
179 (1995) .

															This interpretation of the Commerce Clause has
been disputed. See Camps Newfound/Owatonna, Inc. v. Town
of Harrison , 520 U. S. 564 –620 (1997) (Thomas, J.,
dissenting); Tyler Pipe Industries, Inc. v. Washington
State Dept. of Revenue , 483 U. S. 232 –265 (1987) (Scalia,
J., concurring in part and dissenting in part); License
Cases , 5 How. 504, 578–579 (1847) (Taney, C. J.). But it also
has deep roots. See, e.g., Case of the State Freight Tax , 15
Wall. 232, 279–280 (1873); Cooley v. Board of Wardens of
Port of Philadelphia ex rel. Soc. for Relief of Distressed
Pilots , 12 How. 299, 318–319 (1852); Gibbons v. Ogden , 9 Wheat. 1, 209 (1824) (Marshall, C. J.). By
prohibiting States from discriminating against or imposing
excessive burdens on interstate commerce without congressional
approval, it strikes at one of the chief evils that led to the
adoption of the Constitution, namely, state tariffs and other laws
that burdened interstate commerce. Fulton Corp. v. Faulkner , 516 U. S. 325 –331 (1996); Hughes , supra , at 325; Welton v. Missouri , 91
U. S. 275, 280 (1876) ; see also The Federalist Nos. 7, 11 (A.
Hamilton), and 42 (J. Madison).

															Under our precedents, the dormant Commerce
Clause precludes States from “discriminat[ing] between transactions
on the basis of some interstate element.” Boston Stock
Exchange v. State Tax Comm’n , 429 U. S. 318 ,
n. 12 (1977). This means, among other things, that a State
“may not tax a transaction or incident more heavily when it crosses
state lines than when it occurs entirely within the State.” Armco Inc. v. Hardesty , 467 U. S. 638, 642
(1984) . “Nor may a State impose a tax which discriminates against
interstate commerce either by providing a direct commercial
advantage to local business, or by subjecting interstate commerce
to the burden of ‘multiple taxation.’ ” Northwestern States
Portland Cement Co. v. Minnesota , 358 U. S. 450,
458 (1959) (citations omitted).

															B

															Our existing dormant Commerce Clause cases all
but dictate the result reached in this case by Maryland’s highest
court. Three cases involving the taxation of the income of domestic
corporations are particularly instructive.

															In J. D. Adams Mfg. Co. v. Storen ,
304 U. S. 307 (1938) , Indiana taxed the income of every
Indiana resident (including individuals) and the income that every
nonresident derived from sources within Indiana. Id., at
308. The State levied the tax on income earned by the plaintiff
Indiana corporation on sales made out of the State. Id., at
309. Holding that this scheme violated the dormant Commerce Clause,
we explained that the “vice of the statute” was that it taxed,
“without apportionment, receipts derived from activities in
interstate commerce.” Id ., at 311. If these receipts were
also taxed by the States in which the sales occurred, we warned,
interstate commerce would be subjected “to the risk of a double tax
burden to which intrastate commerce is not exposed, and which the
commerce clause forbids.” Ibid. The next year, in Gwin, White & Prince,
Inc. v. Henneford , 305 U. S. 434 (1939) , we
reached a similar result. In that case, the State of Washington
taxed all the income of persons doing business in the State. Id., at 435. Washington levied that tax on income that the
plaintiff Washington corporation earned in shipping fruit from
Washington to other States and foreign countries. Id., at
436–437. This tax, we wrote, “discriminates against interstate
commerce, since it imposes upon it, merely because interstate
commerce is being done, the risk of a multiple burden to which
local commerce is not exposed.” Id., at 439.

															In the third of these cases involving the
taxation of a domestic corporation, Central Greyhound Lines,
Inc. v. Mealey , 334 U. S. 653 (1948) , New York
sought to tax the portion of a domiciliary bus company’s gross
receipts that were derived from services provided in neighboring
States. Id., at 660; see also id., at 665 (Murphy,
J., dissenting) (stating that the plaintiff was a New York
corporation). Noting that these other States might also attempt to
tax this portion of the company’s gross receipts, the Court held
that the New York scheme violated the dormant Commerce Clause
because it imposed an “unfair burden” on interstate commerce. Id ., at 662 (majority opinion).

															In all three of these cases, the Court struck
down a state tax scheme that might have resulted in the double
taxation of income earned out of the State and that discriminated
in favor of intrastate over interstate economic activity. As we
will explain, see Part II–F, infra , Maryland’s tax scheme is
unconstitutional for similar reasons.

															C

															The principal dissent distinguishes these
cases on the sole ground that they involved a tax on gross receipts
rather than net income. We see no reason why the distinction
between gross receipts and net income should matter, particularly
in light of the admonition that we must consider “not the formal
language of the tax statute but rather its practical effect.” Complete Auto , 430 U. S., at 279. The principal dissent
claims, post , at 13 (opinion of Ginsburg, J.), that “[t]he
Court, historically , has taken the position that the
difference between taxes on net income and taxes on gross receipts
from interstate commerce warrants different results.” 2 C. Trost
& P. Hartman, Federal Limitations on State and Local Taxation
2d §10:1, p. 251 (2003) (emphasis added) (hereinafter Trost). But
this historical point is irrelevant. As the principal dissent seems
to acknowledge, our cases rejected this formal distinction some
time ago. And the distinction between gross receipts and net income
taxes was not the basis for our decisions in J. D.
Adams , Gwin, White , and Central Greyhound , which
turned instead on the threat of multiple taxation.

															The discarded distinction between taxes on gross
receipts and net income was based on the notion, endorsed in some
early cases, that a tax on gross receipts is an impermissible
“direct and immediate burden” on interstate commerce, whereas a tax
on net income is merely an “indirect and incidental” burden. United States Glue Co. v. Town of Oak Creek , 247
U. S. 321 –329 (1918); see also Shaffer v. Carter , 252 U. S. 37, 57 (1920) . This arid distinction
between direct and indirect burdens allowed “very little coherent,
trustworthy guidance as to tax valid-ity.” 2 Trost §9:1, at 212.
And so, beginning with Justice Stone’s seminal opinion in Western Live Stock v. Bureau of Revenue , 303
U. S. 250 (1938) , and continuing through cases like J. D. Adams and Gwin, White , the direct-indirect
burdens test was replaced with a more practical approach that
looked to the economic impact of the tax. These cases worked “a
substantial judicial reinterpretation of the power of the States to
levy taxes on gross income from interstate commerce.” 1 Trost
§2:20, at 175.

															After a temporary reversion to our earlier
formalism, see Spector Motor Service, Inc. v. O’Connor , 340 U. S. 602 (1951), “the gross receipts
judicial pendulum has swung in a wide arc, recently reaching the
place where taxation of gross receipts from interstate commerce is
placed on an equal footing with receipts from local business, in Complete Auto Transit Inc. v . Brady ,” 2 Trost
§9:1, at 212. And we have now squarely rejected the argument that
the Commerce Clause distinguishes between taxes on net and gross
income. See Jefferson Lines , 514 U. S., at 190
(explaining that the Court in Central Greyhound “understood
the gross receipts tax to be simply a variety of tax on income”); Moorman Mfg. Co. v. Bair , 437 U. S. 267, 280
(1978) (rejecting a suggestion that the Commerce Clause
distinguishes between gross receipts taxes and net income taxes); id., at 281 (Brennan, J., dissenting) (“I agree with the
Court that, for purposes of constitutional review, there is no
distinction between a corporate income tax and a gross-receipts
tax”); Complete Auto , supra , at 280 (upholding a
gross receipts tax and rejecting the notion that the Commerce
Clause places “a blanket prohibition against any state taxation
imposed directly on an interstate transaction”).[ 2 ]

															For its part, petitioner distinguishes J. D.
Adams , Gwin, White , and Central Greyhound on the
ground that they concerned the taxation of corporations, not
individuals. But it is hard to see why the dormant Commerce Clause
should treat individuals less favorably than corporations. See Camps Newfound , 520 U. S., at 574 (“A tax on real
estate, like any other tax , may impermissibly burden
interstate commerce” (emphasis added)). In addition, the
distinction between individuals and corporations cannot stand
because the taxes invalidated in J. D. Adams and Gwin, White applied to the income of both individuals and
corporations. See Ind. Stat. Ann., ch. 26, §64–2602 (Burns 1933)
(tax in J. D. Adams ); 1935 Wash. Sess. Laws ch. 180,
Tit. II, §4(e), pp. 710–711 (tax in Gwin, White ).

															Attempting to explain why the dormant Commerce
Clause should provide less protection for natural persons than for
corporations, petitioner and the Solicitor General argue that
States should have a free hand to tax their residents’ out-of-state
income because States provide their residents with many services.
As the Solicitor General puts it, individuals “reap the benefits of
local roads, local police and fire protection, local public
schools, [and] local health and welfare benefits.” Brief for United
States as Amicus Curiae 30.

															This argument fails because corporations also
benefit heavily from state and local services. Trucks hauling a
corporation’s supplies and goods, and vehicles transporting its
employees, use local roads. Corporations call upon local police and
fire departments to protect their facilities. Corporations rely on
local schools to educate prospective employees, and the
availability of good schools and other government services are
features that may aid a corporation in attracting and retaining
employees. Thus, disparate treatment of corporate and personal
income cannot be justified based on the state services enjoyed by
these two groups of taxpayers.

															The sole remaining attribute that, in the view
of petitioner, distinguishes a corporation from an individual for
present purposes is the right of the individual to vote. The
principal dissent also emphasizes that residents can vote to change
Maryland’s discriminatory tax law. Post , at 3–4. The
argument is that this Court need not be concerned about state laws
that burden the interstate activities of individuals because those
individuals can lobby and vote against legislators who support such
measures. But if a State’s tax unconstitutionally discriminates
against interstate commerce, it is invalid regardless of whether
the plaintiff is a resident voter or nonresident of the State. This
Court has thus entertained and even sustained dormant Commerce
Clause challenges by individual residents of the State that imposed
the alleged burden on interstate commerce, Department of Revenue
of Ky. v. Davis , 553 U. S. 328, 336 (2008) ; Granholm v. Heald , 544 U. S. 460, 469 (2005) ,
and we have also sustained such a challenge to a tax whose burden
was borne by in-state consumers, Bacchus Imports, Ltd. v. Dias , 468 U. S. 263, 272 (1984) .[ 3 ]

															The principal dissent and Justice Scalia respond
to these holdings by relying on dictum in Goldberg v. Sweet , 488 U. S. 252, 266 (1989) , that it is not the
purpose of the dormant Commerce Clause “ ‘to protect state
residents from their own state taxes.’ ” Post , at 3
(Ginsburg, J., dissenting); post, at 5 (Scalia, J.,
dissenting). But we repudiated that dictum in West Lynn
Creamery, Inc. v. Healy, 512 U. S. 186 (1994) , where we
stated that “[s]tate taxes are ordinarily paid by in-state
businesses and consumers, yet if they discriminate against
out-of-state products, they are unconstitutional.” Id., at
203. And, of course, the dictum must bow to the holdings of our
many cases entertaining Commerce Clause challenges brought by
residents. We find the dissents’ reliance on Goldberg ’s
dictum particularly inappropriate since they do not find themselves
similarly bound by the rule of that case, which applied the
internal consistency test to determine whether the tax at issue
violated the dormant Commerce Clause. 488 U. S., at 261.

															In addition, the notion that the victims of such
discrimination have a complete remedy at the polls is fanciful. It
is likely that only a distinct minority of a State’s residents
earns income out of State. Schemes that discriminate against income
earned in other States may be attractiveto legislators and a
majority of their constituents for precisely this reason. It is
even more farfetched to suggest that natural persons with
out-of-state income are better able to influence state lawmakers
than large corporations headquartered in the State. In short,
petitioner’s argument would leave no security where the majority of
voters prefer protectionism at the expense of the few who earn
income interstate.

															It would be particularly incongruous in the
present case to disregard our prior decisions regarding the
taxation of corporate income because the income at issue here is a
type of corporate income, namely, the income of a Subchapter S
corporation. Only small businesses may incorporate under Subchapter
S, and thus acceptance of petitioner’s submission would provide
greater protection for income earned by large Subchapter C
corporations than small businesses incorporated under Subchapter
S.

															D

															In attempting to justify Maryland’s unusual
tax scheme, the principal dissent argues that the Commerce Clause
imposes no limit on Maryland’s ability to tax the income of its
residents, no matter where that income is earned. It argues that
Maryland has the sovereign power to tax all of the income of its
residents, wherever earned, and it there-fore reasons that the
dormant Commerce Clause cannot constrain Maryland’s ability to
expose its residents (and nonresidents) to the threat of double
taxation.

															This argument confuses what a State may do
without violating the Due Process Clause of the Fourteenth
Amendment with what it may do without violating the Commerce
Clause. The Due Process Clause allows a State to tax “ all the income of its residents, even income earned outside the taxing
jurisdiction.” Oklahoma Tax Comm’n v. Chickasaw
Nation , 515 U. S. 450 –463 (1995). But “while a State may,
consistent with the Due Process Clause, have the authority to tax a
particular taxpayer, imposition of the tax may nonetheless violate
the Commerce Clause.” Quill Corp. v. North Dakota ,
504 U. S. 298, 305 (1992) (rejecting a due process challenge
to a tax before sustaining a Commerce Clause challenge to that
tax).

															Our decision in Camps Newfound illustrates the point. There, we held that the Commerce Clause
prohibited Maine from granting more favorable tax treatment to
charities that operated principally for the benefit of Maine
residents. 520 U. S., at 580–583. Because the plaintiff
charity in that case was a Maine nonprofit corporation, there is no
question that Maine had the raw jurisdictional power to tax the
charity. See Chickasaw Nation , supra , at 462–463.
Nonetheless, the tax failed scrutiny under the Commerce Clause. Camps Newfound , supra , at 580–581. Similarly,
Maryland’s raw power to tax its residents’ out-of-state income does
not insulate its tax scheme from scrutiny under the dormant
Commerce Clause.

															Although the principal dissent claims the mantle
of precedent, it is unable to identify a single case that endorses
its essential premise, namely, that the Commerce Clause places no
constraint on a State’s power to tax the income of its residents
wherever earned. This is unsurprising. As cases like Quill
Corp. and Camps Newfound recognize, the fact that a
State has the jurisdictional power to impose a tax says nothing
about whether that tax violates the Commerce Clause. See also, e.g., Barclays Bank PLC v. Franchise Tax Bd. of Cal. ,
512 U. S. 298 (1994) (separately addressing due process and
Commerce Clause challenges to a tax); Moorman , 437
U. S. 267 (same); Standard Pressed Steel Co. v. Department of Revenue of Wash. , 419 U. S. 560 (1975)
(same); Lawrence v. State Tax Comm’n of Miss. , 286
U. S. 276 (1932) (separately addressing due process and equal
protection challengesto a tax); Travis v. Yale &
Towne Mfg. Co. , 252 U. S. 60 (1920) (separately addressing
due process and privileges-and-immunities challenges to a tax).

															One good reason why we have never accepted the
principal dissent’s logic is that it would lead to plainly
untenable results. Imagine that Maryland taxed the income that its
residents earned in other States but exempted income earned out of
State from any business that primarily served Maryland residents.
Such a tax would violate the dormant Commerce Clause, see Camps
Newfound , supra , and it cannot be saved by the principal
dissent’s admonition that Maryland has the power to tax all the
income of its residents. There is no principled difference between
that hypothetical Commerce Clause challenge and this one.

															The principal dissent, if accepted, would work a
sea change in our Commerce Clause jurisprudence. Legion are the
cases in which we have considered and even upheld dormant Commerce
Clause challenges brought by residents to taxes that the State had
the jurisdictional power to impose. See, e.g., Davis , 553
U. S. 328 ; Camps Newfound , 520 U. S. 564 ; Fulton Corp. , 516 U. S. 325 ; Bacchus Imports ,
468 U. S. 263 ; Central Greyhound , 334 U. S. 653 ; Gwin, White , 305 U. S. 434 ; J. D. Adams ,
304 U. S. 307 . If the principal dissent were to prevail, all
of these cases would be thrown into doubt. After all, in those
cases, as here, the State’s decision to tax in a way that allegedly
discriminates against interstate commerce could be justified by the
argument that a State may tax its residents without any Commerce
Clause constraints.

															E

															While the principal dissent claims that we are
departing from principles that have been accepted for “a century”
and have been “repeatedly acknowledged by this Court,” see post , at 1, 2, 19, when it comes to providing supporting
authority for this assertion, it cites exactly two Commerce Clause
decisions that are supposedly inconsistent with our decision today.
One is a summary affirmance, West Publishing Co. v. McColgan , 328 U. S. 823 (1946) , and neither actually
supports the principal dissent’s argument.

															In the first of these cases, Shaffer v. Carter , 252 U. S. 37 , a resident of Illinois who
earned income from oil in Oklahoma unsuccessfully argued that his
Oklahoma income tax assessment violated several provisions of the
Federal Constitution. His main argument was based on due process,
but he also raised a dormant Commerce Clause challenge. Although
the principal dissent relies on Shaffer for the proposition
that a State may tax the income of its residents wherever earned, Shaffer did not reject the Commerce Clause challenge on that
basis.

															The dormant Commerce Clause challenge in Shaffer was nothing like the Wynnes’ challenge here. The
tax-payer in Shaffer argued that “[i]f the tax is considered
an excise tax on business, rather than an income tax proper,” it
unconstitutionally burdened interstate commerce. Brief for
Appellant, O. T. 1919, No. 531, p. 166. The taxpayer did
not argue that this burden occurred because he was subject to
double taxation; instead, he argued that the tax was an
impermissible direct “tax on interstate business.” Ibid. That argument was based on the notion that States may not impose a
tax “directly” on interstate commerce. See supra, at 8–9.
After assuming that the taxpayer’s business was engaged in
interstate commerce, we held that “it is sufficient to say that the
tax is imposed not upon the gross receipts, but only upon the
net proceeds, and is plainly sustainable, even if it includes net
gains from interstate commerce. [ United States Glue Co. v. Town of Oak Creek ], 247 U. S. 321 .” Shaffer , supra , at 57 (citation omitted). Shaffer thus did not adjudicate anything
like the double taxation argument that was accepted in later cases
and is before us today. And the principal dissent’s suggestion that Shaffer allows States to levy discriminatory net income
taxes is refuted by a case decided that same day. In Travis ,
a Connecticut corporation challenged New York’s net income tax,
which allowed residents, but not nonresidents, certain tax
exemptions. The Court first rejected the taxpayer’s due process
argument as “settled by our decision in Shaffer .” 252
U. S., at 75. But that due process inquiry was not the end of
the matter: the Court then separately considered—and sustained—the
argument that the net income tax’s disparate treatment of residents
and nonresidents violated the Privileges and Immunities Clause. Id., at 79–80.

															The second case on which the principal dissent
relies, West Publishing , is a summary affirmance and thus
has “considerably less precedential value than an opinion on the
merits.” Illinois Bd. of Elections v. Socialist Workers
Party , 440 U. S. 173 –181 (1979). A summary affirmance
“ ‘is not to be read as a renunciation by this Court of
doctrines previously announced in our opinions after full
argument.’ ” Mandel v. Bradley , 432 U. S.
173, 176 (1977) ( per curiam ) (quoting Fusari v. Steinberg , 419 U. S. 379, 392 (1975) (Burger,
C. J., concurring)). The principal dissent’s reliance on the
state-court decision below in that case is particularly
inappropriate because “a summary affirmance is an affirmance of the
judgment only,” and “the rationale of the affirmance may not be
gleaned solely from the opinion below.” 432 U. S., at
176 . Moreover, we do not disagree with the result of West Publishing . The tax in that case was levied only on
“ ‘the net income of every corporation derived from sources
within this State ,’ ” and thus was an internally
consistent and nondiscriminatory tax scheme. See West Publishing
Co. v. McColgan , 27 Cal. 2d 705, 707, n., 166 P. 2d
861, 862, n. (1946) (emphasis added). Moreover, even if we did
disagree with the result, the citation in our summary affirmance to United States Glue Co. suggests that our decision was based
on the since-discarded distinction between net income and gross
receipts taxes. West Publishing did not—indeed, it could
not—repudiate the double taxation cases upon which we rely.

															The principal dissent also finds it significant
that, when States first enacted modern income taxes in the early
1900’s, some States had tax schemes similar to Maryland’s. This
practice, however, was by no means universal. A great many
States—such as Alabama, Colorado, Georgia, Kentucky, and
Maryland—had early income tax schemes that allowed their residents
a credit against taxes paid to other States. See Ala. Code, Tit.
51, ch. 17, §390 (1940); Colo. Stat. Ann., ch. 84A, §38 (Cum. Supp.
1951); Ga. Code Ann. §92–3111 (1974); Carroll’s Ky. Stat. Ann., ch.
108, Art. XX, §4281b–15 (Baldwin rev. 1936); Md. Ann. Code, Art.
81, ch. 277, §231 (1939). Other States also adopted internally
consistent tax schemes. For example, Massachusetts and Utah taxed
only the income of residents, not nonresidents. See Mass. Gen.
Laws, ch. 62 (1932); Utah Rev. Stat. §80–14–1 et seq. (1933).

															In any event, it is hardly surprising that these
early state ventures into the taxation of income included some
protectionist regimes that favored the local economy over
interstate commerce. What is much more significant is that over the
next century, as our Commerce Clause juris-prudence developed, the
States have almost entirely abandoned that approach, perhaps in
recognition of their doubtful constitutionality. Today, the
near-universal state practice is to provide credits against
personal income taxes for such taxes paid to other States. See 2 J.
Hellerstein & W. Hellerstein, State Taxation, ¶20.10,
pp. 20–163 to 20–164 (3d ed. 2003).[ 4 ]

															F

															1

															As previously noted, the tax schemes held to
be unconstitutional in J. D. Adams , Gwin, White ,
and Central Greyhound , had the potential to result in the
discriminatory double taxation of income earned out of state and
created a powerful incentive to engage in intrastate rather than
interstate economic activity. Although we did not use the term in
those cases, we held that those schemes could be cured by taxes
that satisfy what we have subsequently labeled the “internal
consistency” test. See Jefferson Lines , 514 U. S., at
185 (citing Gwin, White as a case requiring internal
consistency); see also 1 Trost §2:19, at 122–123, and n. 160
(explaining that the internal consistency test has its origins in Western Live Stock , J. D. Adams , and Gwin,
White ). This test, which helps courts identify tax schemes that
discriminate against interstate commerce, “looks to the structure
of the tax at issue to see whether its identical application by
every State in the Union would place interstate commerce at a
disadvantage as compared with commerce intrastate.” 514 U. S.,
at 185 . See also, e.g., Tyler Pipe , 483 U. S.,
at 246–248; Armco , 467 U. S., at 644–645; Container
Corp. of America v. Franchise Tax Bd. , 463 U. S.
159, 169 (1983) .

															By hypothetically assuming that every State has
the same tax structure, the internal consistency test allows courts
to isolate the effect of a defendant State’s tax scheme. This is a
virtue of the test because it allows courts to distinguish between
(1) tax schemes that inherently discriminate against
interstate commerce without regard to the tax policies of other
States, and (2) tax schemes that create disparate incentives
to engage in interstate commerce (and sometimes result in double
taxation) only as a result of the interaction of two different but
nondiscriminatory and internally consistent schemes. See Armco , supra , at 645–646; Moorman , 437
U. S., at 277, n. 12; Brief for Tax Economists as Amici Curiae 23–24 (hereinafter Brief for Tax Economists);
Brief for Michael S. Knoll & Ruth Mason as Amici Curiae 18–23 (hereinafter Brief for Knoll & Mason). The first category
of taxes is typically unconstitutional; the second is not.[ 5 ] See Armco , supra , at
644–646; Moorman , supra , at 277, and n. 12. Tax
schemes that fail the internal consistency test will fall into the
first category, not the second: “[A]ny cross-border tax
disadvantage that remains after application of the [test] cannot be
due to tax disparities”[ 6 ] but
is instead attributable to the taxing State’s discriminatory
policies alone.

															Neither petitioner nor the principal dissent
questions the economic bona fides of the internal consistency test.
And despite its professed adherence to precedent, the principal
dissent ignores the numerous cases in which we have applied the
internal consistency test in the past. The internal consistency
test was formally introduced more than three decades ago, see Container Corp. , supra , and it has been invoked in no
fewer than seven cases, invalidating the tax in three of those
cases. See American Trucking Assns., Inc. v. Michigan
Pub. Serv. Comm’n , 545 U. S. 429 (2005) ;[ 7 ] Jefferson Lines, Inc. , 514
U. S. 175 ; Goldberg , 488 U. S. 252; American
Trucking Assns., Inc. v. Scheiner , 483 U. S. 266
(1987) ; Tyler Pipe , 483 U. S. 232 ; Armco , 467
U. S. 638 ; Container Corp. , supra .

															2

															Maryland’s income tax scheme fails the
internal consistency test.[ 8 ] A
simple example illustrates the point. Assume that every State
imposed the following taxes, which are similar to Maryland’s
“county” and “special nonresident” taxes: (1) a 1.25% tax on income
that residents earn in State, (2) a 1.25% tax on income that
residents earn in other jurisdictions, and (3) a 1.25% tax on
income that nonresidents earn in State. Assume further that two
taxpayers, April and Bob, both live in State A, but that April
earns her income in State A whereas Bob earns his income in State
B. In this circumstance, Bob will pay more income tax than April
solely because he earns income interstate. Specifically, April will
have to pay a 1.25% tax only once, to State A. But Bob will have to
pay a 1.25% tax twice: once to State A, where he resides, and once
to State B, where he earns the income.

															Critically—and this dispels a central argument
made by petitioner and the principal dissent—the Maryland scheme’s
discriminatory treatment of interstate commerce is not simply the
result of its interaction with the taxing schemes of other States.
Instead, the internal consistency test reveals what the undisputed
economic analysis shows: Maryland’s tax scheme is inherently
discriminatory and operates as a tariff. See Brief for Tax
Economists 4, 9; Brief for Knoll & Mason 2. This identity
between Maryland’s tax and a tariff is fatal because tariffs are
“[t]he paradigmatic example of a law discriminating against
interstate commerce.” West Lynn , 512 U. S., at 193.
Indeed, when asked about the foregoing analysis made by amici Tax Economists and Knoll & Mason, counsel for
Maryland responded, “I don’t dispute the mathematics. They lose me
when they switch from tariffs to income taxes.” Tr. of Oral Arg. 9.
But Maryland has offered no reason why our analysis should change
because we deal with an income tax rather than a formal tariff, and
we see none. After all, “tariffs against the products of other
States are so patently unconstitutional that our cases reveal not a
single attempt by any State to enact one. Instead, the cases are
filled with state laws that aspire to reap some of the benefits of
tariffs by other means.” West Lynn , supra , at
193.

															None of our dissenting colleagues dispute this
economic analysis. The principal dissent focuses instead on a
supposed “oddity” with our analysis: The principal dissent can
envision other tax schemes that result in double taxation but do
not violate the internal consistency test. This would happen, the
principal dissent points out, if State A taxed only based on
residence and State B taxed only based on source. Post , at
17 (Ginsburg, J., dissenting); see also post , at 7 (Scalia,
J., dissenting). Our prior decisions have already considered and
rejected this precise argument—and for good reason. For example, in Armco , we struck down an internally inconsistent tax that
posed a risk of double taxation even though we recognized that
there might be other permissible arrangements that would result in
double taxation. Such schemes would be constitutional, we
explained, because “such a result would not arise from
impermissible discrimination against interstate commerce.” 467
U. S., at 645. The principal dissent’s protest that our
distinction is “entirely circular,” post , at 17–18,
n. 10, misunderstands the critical distinction, recognized in
cases like Armco , between discriminatory tax schemes and
double taxation that results only from the interaction of two
different but nondiscriminatory tax schemes. See also Moorman , 437 U. S., at 277, n. 12 (distinguishing
“the potential consequences of the use of different formulas by the
two States,” which is not prohibited by the Commerce Clause, from
discrimination that “inhere[s] in either State’s formula,” which is
prohibited).

															Petitioner and the Solicitor General argue that
Maryland’s tax is neutral, not discriminatory, because the same tax
applies to all three categories of income. Specifically, they point
out that the same tax is levied on (1) residents who earn
income in State, (2) residents who earn income out of State,
and (3) nonresidents who earn income in State. But the fact
that the tax might have “ ‘the advantage of appearing
nondiscriminatory’ does not save it from invalidation.” Tyler
Pipe , 483 U. S., at 248 (quoting General Motors
Corp. v. Washington , 377 U. S. 436, 460 (1964)
(Goldberg, J., dissenting)). See also American Trucking Assns.,
Inc. v. Scheiner , 483 U. S. at, 281 (dormant
Commerce Clause applies to state taxes even when they “do not
allocate tax burdens between insiders and outsiders in a manner
that is facially discriminatory”); Maine v. Taylor ,
477 U. S. 131, 138 (1986) (a state law may discriminate
against interstate commerce “ ‘either on its face or in
practical effect’ ” (quoting Hughes , 441 U. S., at
336)). In this case, the internal consistency test and economic
analysis—indeed, petitioner’s own concession—confirm that the tax
scheme operates as a tariff and discriminates against interstate
commerce, and so the scheme is invalid.

															Petitioner and the principal dissent, post , at 6, also note that by offering residents who earn
income in interstate commerce a credit against the “state” portion
of the income tax, Maryland actually receives less tax revenue from
residents who earn income from interstate commerce rather than
intrastate commerce. This argument is a red herring. The critical
point is that the total tax burden on interstate commerce is
higher, not that Maryland may receive more or less tax revenue from
a particular tax-payer. See Armco , supra , at 642–645.
Maryland’s tax un-constitutionally discriminates against interstate
commerce, and it is thus invalid regardless of how much a
particular taxpayer must pay to the taxing State.

															Once again, a simple hypothetical illustrates
the point. Assume that State A imposes a 5% tax on the income that
its residents earn in-state but a 10% tax on income they earn in
other jurisdictions. Assume also that State A happens to grant a
credit against income taxes paid to other States. Such a scheme
discriminates against interstate commerce because it taxes income
earned interstate at a higher rate than income earned intrastate.
This is so despite the fact that, in certain circumstances, a
resident of State A who earns income interstate may pay less tax to
State A than a neighbor who earns income intrastate. For example,
if Bob lives in State A but earns his income in State B, which has
a 6% income tax rate, Bob would pay a total tax of 10% on his
income, though 6% would go to State B and (because of the credit)
only 4% would go to State A. Bob would thus pay less to State A
than his neighbor, April, who lives in State A and earns all of her
income there, because April would pay a 5% tax to State A. But
Bob’s tax burden to State A is irrelevant; his total tax burden is
what matters.

															The principal dissent is left with two arguments
against the internal consistency test. These arguments are
inconsistent with each other and with our precedents.

															First, the principal dissent claims that the
analysis outlined above requires a State taxing based on residence
to “recede” to a State taxing based on source. Post , at 1–2.
We establish no such rule of priority. To be sure, Maryland could
remedy the infirmity in its tax scheme by offering, as most States
do, a credit against income taxes paid to other States. See Tyler Pipe , supra , at 245–246, and n. 13. If it
did, Maryland’s tax scheme would survive the internal consistency
test and would not be inherently discriminatory. Tweak our first
hypothetical, supra, at 21–22, and assume that all States
impose a 1.25% tax on all three categories of income but also allow
a credit against income taxes that residents pay to other
jurisdictions. In that circumstance, April (who lives and works in
State A) and Bob (who lives in State A but works in State B) would
pay the same tax. Specifically, April would pay a 1.25% tax only
once (to State A), and Bob would pay a 1.25% tax only once (to
State B, because State A would give him a credit against the tax he
paid to State B).

															But while Maryland could cure the problem with
its current system by granting a credit for taxes paid to other
States, we do not foreclose the possibility that it could comply
with the Commerce Clause in some other way. See Brief for Tax
Economists 32; Brief for Knoll & Mason 28–30. Of course, we do
not decide the constitutionality of a hypothetical tax scheme that
Maryland might adopt because such a scheme is not before us. That
Maryland’s existing tax unconstitutionally discriminates against
interstate commerce is enough to decide this case.

															Second, the principal dissent finds a “deep
flaw” with the possibility that “Maryland could eliminate the
inconsistency [with its tax scheme] by terminating the special
nonresident tax—a measure that would not help the Wynnes at all.” Post , at 16. This second objection refutes the first. By
positing that Maryland could remedy the unconstitutionality of its
tax scheme by eliminating the special nonresident tax, the
principal dissent accepts that Maryland’s desire to tax based on
residence need not “recede” to another State’s desire to tax based
on source.

															Moreover, the principal dissent’s supposed flaw
is simply a truism about every case under the dormant Commerce
Clause (not to mention the Equal Protection Clause): Whenever
government impermissibly treats like cases differently, it can cure
the violation by either “leveling up” or “leveling down.” Whenever
a State impermissibly taxes interstate commerce at a higher rate
than intrastate commerce, that infirmity could be cured by lowering
the higher rate, raising the lower rate, or a combination of the
two. For this reason, we have concluded that “a State found to have
imposed an impermissibly discriminatory tax retains flexibility in
responding to this determination.” McKesson Corp. v. Division of Alcoholic Beverages and Tobacco, Fla. Dept. of
Business Regulation , 496 U. S. 18 –40 (1990). See also Associated Industries of Mo. v. Lohman, 511
U. S. 641, 656 (1994) ; Fulton Corp. , 516 U. S.,
at 346–347. If every claim that suffers from this “flaw” cannot
succeed, no dormant Commerce Clause or equal protection claim could
ever succeed.

															G

															Justice Scalia would uphold the
constitutionality of the Maryland tax scheme because the dormant
Commerce Clause, in his words, is “a judicial fraud.” Post ,
at 2. That was not the view of the Court in Gibbons v. Ogden , 9 Wheat, at 209, where Chief Justice Marshall wrote
that there was “great force” in the argument that the Commerce
Clause by itself limits the power of the States to enact laws
regulating interstate commerce. Since that time, this supposedly
fraudulent doctrine has been applied in dozens of our opinions,
joined by dozens of Justices. Perhaps for this reason, petitioner
in this case, while challenging the interpretation and application
of that doctrine by the court below, did not ask us to reconsider
the doctrine’s validity.

															Justice Scalia does not dispute the fact that
State tariffs were among the principal problems that led to the
adoption of the Constitution. See post , at 3. Nor does he
dispute the fact that the Maryland tax scheme is tantamount to a
tariff on work done out of State. He argues, however, that the
Constitution addresses the problem of state tariffs by prohibiting
States from imposing “ ‘Imposts or Duties on Imports or
Exports.’ ” Ibid. (quoting Art. I, §10, cl. 2).
But he does not explain why, under his interpretation of the
Constitution, the Import-Export Clause would not lead to the same
result that we reach under the dormant Commerce Clause. Our cases
have noted the close relationship between the two provisions. See, e.g., State Tonnage Tax Cases , 12 Wall. 204, 214 (1871).

															Justice Thomas also refuses to accept the
dormant Commerce Clause doctrine, and he suggests that the
Constitution was ratified on the understanding that it would not
prevent a State from doing what Maryland has done here. He notes
that some States imposed income taxes at the time of the adoption
of the Constitution, and he observes that “[t]here is no indication
that those early state income tax schemes provided credits for
income taxes paid elsewhere.” Post , at 2 (dissenting
opinion). “It seems highly implausible,” he writes, “that those who
ratified the Commerce Clause understood it to conflict with the
income tax laws of their States and nonetheless adopted it without
a word of concern.” Ibid. This argument is plainly
unsound.

															First, because of the difficulty of interstate
travel, the number of individuals who earned income out of State in
1787 was surely very small. (We are unaware of records showing, for
example, that it was common in 1787 for workers to commute to
Manhattan from New Jersey by rowboat or from Connecticut by
stagecoach.)

															Second, Justice Thomas has not shown that the
small number of individuals who earned income out of State were
taxed twice on that income. A number of Founding-era income tax
schemes appear to have taxed only the income of residents, not
nonresidents. For example, in his report to Congress on direct
taxes, Oliver Wolcott, Jr., Secretary of Treasury, describes
Delaware’s income tax as being imposed only on “the inhabitants of
this State,” and he makes no mention of the taxation of
nonresidents’ income. Report to 4th Cong., 2d Sess. (1796),
concerning Direct Taxes, in 1 American State Papers, Finance 429
(1832). Justice Thomas likewise understands that the Massachusetts
and Delaware income taxes were imposed only on residents. Post , at 2, n. These tax schemes, of course, pass the
internal consistency test. Moreover, the difficulty of
administering an income tax on nonresidents would have diminished
the likelihood of double taxation. See R. Blakey, State Income
Taxation 1 (1930).

															Third, even if some persons were taxed twice, it
is unlikely that this was a matter of such common knowledge that it
must have been known by the delegates to the State ratifying
conventions who voted to adopt theConstitution.

															*  *  *

															For these reasons, the judgment of the Court
of Appeals of Maryland is affirmed.

															It is so ordered. Notes 1 Under federal law, S
corporations permit shareholders “to elect a ‘pass-through’
taxation system under which income is subjected to only one level
of taxation. The corporation’s profits pass through directly to its
shareholders on a pro rata basis and are reported on the
shareholders’ individual tax returns.” Gitlitz v. Commissioner , 531 U. S. 206, 209 (2001) (citation
omitted). Maryland affords similar pass-through treatment to the
income of an S corporation. 431 Md. 147, 158, 64 A. 3d 453, 459
(2013). By contrast, C corporations—organized under Subchapter C
rather than S of Chapter 1 of the Internal Revenue Code—must pay
their own taxes because they are considered to be separate tax
entities from their shareholders. 14A W. Fletcher, Cyclopedia of
the Law of Corporations §§6971, 6973 (rev. ed. 2008 and Cum. Supp.
2014–2015). Because of limitations on the number and type of
shareholders they may have, S corporations tend to be smaller, more
closely held corporations. Id., §§7025.50,
7026. 2 The principal dissent
mischaracterizes the import of the Court’s statement in Moorman that a gross receipts tax is “ ‘more
burdensome’ ” than a net income tax. Post , at 13. This
was a statement about the relative economic impact of the taxes (a
gross receipts tax applies regardless of whether the corporation
makes a profit). It was not, as Justice Brennan confirmed in
dissent, a suggestion that net income taxes are subject to lesser
constitutional scrutiny than gross receipts taxes. Indeed, we noted
in Moorman that “the actual burden on interstate commerce
would have been the same had Iowa imposed a plainly valid
gross-receipts tax instead of the challenged [net] income tax.” Moorman Mfg. Co. v. Bair , 437 U. S. 267 –281
(1978). 3 Similarly, we have
sustained dormant Commerce Clause challenges by corporate residents
of the State that imposed the burden on interstate commerce. See, e.g., Camps Newfound/Owatonna, Inc. v. Town of
Harrison , 520 U. S. 564, 567 (1997) ; Fulton Corp. v. Faulkner , 516 U. S. 325, 328 (1996) ; Central
Greyhound Lines, Inc. v. Mealey , 334 U. S. 653, 654
(1948) ; Gwin, White & Prince, Inc. v. Henneford ,
305 U. S. 434, 435 (1939) ; J. D. Adams Mfg. Co. v. Storen , 304 U. S. 307, 308 (1938) . 4 There is no merit to
petitioner’s argument that Maryland is free to adopt any tax scheme
that is not actually intended to discriminate against interstate
commerce. Reply Brief 7. The Commerce Clause regulates effects, not
motives, and it does not require courts to inquire into voters’ or
legislators’ reasons for enacting a law that has a discriminatory
effect. See, e.g. , Associated Industries of Mo. v. Lohman , 511 U. S. 641, 653 (1994) ; Philadelphia v. New Jersey , 437 U. S. 617 –627 (1978); Hunt v. Washington State Apple Advertising Comm’n , 432 U. S. 333
–353 (1977). 5 Our cases have held that
tax schemes may be invalid under the dormant Commerce Clause even
absent a showing of actual double taxation. Mobil Oil Corp. v. Commissioner of Taxes of Vt. , 445 U. S. 425, 444
(1980) ; Gwin, White , 305 U. S., at 439. We note,
however, that petitioner does not dispute that respondents have
been subject to actual multiple taxation in this case. 6 Mason, Made in America
for European Tax: The Internal Consistency Test, 49 Boston College
L. Rev. 1277, 1310 (2008). 7 The principal dissent and
Justice Scalia inaccurately state that the Court in American
Trucking “conceded that a trucking tax ‘fail[ed] the “internal
consistency” test,’ but upheld the tax anyway.” Post , at 5
(Scalia, J., dissenting); see also post , at 14–15 (Ginsburg,
J., dissenting). The Court did not say that the tax in question
“failed the ‘internal consistency test.’ ” The Court wrote
that this is what petitioner argued . See American
Trucking , 545 U. S., at 437. And the Court did not concede
that this was true. The tax in that case was a flat tax on any
truck that made point-to-point deliveries in Michigan. The tax
therefore fell on all trucks that made solely intrastate deliveries
and some that made interstate deliveries, namely, those that also
made some intrastate deliveries. What the Court “concede[d]” was
that “if all States [adopted a similar tax], an interstate truck
would have to pay fees totaling several hundred dollars, or even
several thousand dollars, were it to ‘top off’ its business by
carrying local loads in many (or even all) other States .” Id., at 438 (emphasis added). But that was not the same as a
concession that the tax violated the internal consistency
test. 8 In order to apply the
internal consistency test in this case, we must evaluate the
Maryland income tax scheme as a whole. That scheme taxes three
separate categories of income: (1) the “county tax” on income that
Maryland residents earn in Maryland; (2) the “county tax” on income
that Maryland residents earn in other States; and (3) the “special
nonresident tax” on income that nonresidents earn in Maryland. For
Commerce Clause purposes, it is immaterial that Maryland assigns
different labels ( i.e. , “county tax” and “special
nonresident tax”) to these taxes. In applying the dormant Commerce
Clause, they must be considered as one. Cf. Oregon Waste
Systems, Inc. v. Department of Environmental Quality of
Ore. , 511 U. S. 93 –103 (1994) (independent taxes on intrastate
and interstate commerce are “compensatory” if they are rough
equivalents imposed upon substantially similar events). If state
labels controlled, a State would always be free to tax domestic,
inbound, and outbound income at discriminatory rates simply by
attaching different labels. SUPREME COURT OF THE UNITED STATES

															_________________

															No. 13–485

															_________________

															COMPTROLLER OF THE TREASURY OF MARYLAND,
PETITIONER v. BRIAN WYNNE et ux.

															on writ of certiorari to the court of appeals
of maryland

															[May 18, 2015]

															Justice Scalia, with whom Justice Thomas joins
as to Parts I and II, dissenting.

															The Court holds unconstitutional Maryland’s
refusal to give its residents full credits against income taxes
paid to other States. It does this by invoking the negative
Commerce Clause, a judge-invented rule under which judges may set
aside state laws that they think impose too much of a burden upon
interstate commerce. I join the principal dissent, which
demonstrates the incompatibility of this decision with our prior
negative Commerce Clause cases. Post , at 2–14 (opinion of
Ginsburg, J.). Incompatibility, however, is not the test for
me—though what is incompatible with our cases a fortiori fails my test as well, as discussed briefly
in Part III below. The principal purpose of my writing separately
is to point out how wrong our negative Commerce Clause
jurisprudence is in the first place, and how well today’s decision
illustrates its error.

															I

															The fundamental problem with our negative
Commerce Clause cases is that the Constitution does not contain a
negative Commerce Clause. It contains only a Commerce Clause.
Unlike the negative Commerce Clause adopted by the judges, the real
Commerce Clause adopted by the People merely empowers Congress to
“regulate Commerce with foreign Nations, and among the several
States, and with the Indian Tribes.” Art. I, §8, cl. 3. The
Clause says nothing about prohibiting state laws that burden
commerce. Much less does it say anything about authorizing judges
to set aside state laws they believe burden commerce. The
clearest sign that the negative Commerce Clause is a judicial fraud
is the utterly illogical holding that congressional consent enables
States to enact laws that would otherwise constitute impermissible
burdens upon interstate commerce. See Prudential Ins. Co. v. Benjamin , 328 U. S. 408 –427 (1946). How could
congressional consent lift a constitutional prohibition? See License Cases , 5 How. 504, 580 (1847) (opinion of Taney,
C. J.).

															The Court’s efforts to justify this judicial
economic veto come to naught. The Court claims that the doctrine
“has deep roots.” Ante, at 5. So it does, like many weeds.
But age alone does not make up for brazen invention. And the
doctrine in any event is not quite as old as the Court makes it
seem. The idea that the Commerce Clause of its own force limits
state power “finds no expression” in discussions surrounding the
Constitution’s ratification. F. Frankfurter, The Commerce Clause
Under Marshall, Taney and Waite 13 (1937). For years after the
adoption of the Constitution, States continually made regulations
that burdened interstate commerce (like pilotage laws and
quarantine laws) without provoking any doubts about their
constitutionality. License Cases , supra, at 580–581.
This Court’s earliest allusions to a negative Commerce Clause came
only in dicta—ambiguous dicta, at that—and were vigorously
contested at the time. See, e.g., id., at 581–582. Our first
clear holding setting aside a state law under the negative
Commerce Clause came after the Civil War, more than 80 years after
the Constitution’s adoption. Case of the State Freight Tax ,
15 Wall. 232 (1873). Since then, we have tended to revamp the
doctrine every couple of decades upon finding existing decisions
unworkable or unsatisfactory. See Quill Corp. v. North
Dakota , 504 U. S. 298, 309 (1992) . The negative Commerce
Clause applied today has little in common with the negative
Commerce Clause of the 19th century, except perhaps for
incoherence.

															The Court adds that “tariffs and other laws that
burdened interstate commerce” were among “the chief evils that led
to the adoption of the Constitution.” Ante , at 5. This line
of reasoning forgets that interpretation requires heeding more than
the Constitution’s purposes; it requires heeding the means the
Constitution uses to achieve those purposes. The Constitution
addresses the evils of local impediments to commerce by prohibiting
States from imposing certain especially burdensome taxes—“Imposts
or Duties on Imports or Exports” and “Dut[ies] of Tonnage”—without
congressional consent. Art. I, §10, cls. 2–3. It also addresses
these evils by giving Congress a com-merce power under which it may prohibit other burdensome taxes and laws. As the
Constitution’s text shows, however, it does not address these evils
by empowering the judiciary to set aside state taxes and
laws that it deems too burdensome. By arrogating this power
anyway, our negative Commerce Clause cases have disrupted the
balance the Constitution strikes between the goal of protecting
commerce and competing goals like preserving local autonomy and
promoting democratic responsibility.

															II

															The failings of negative Commerce Clause
doctrine go beyond its lack of a constitutional foundation, as
today’s decision well illustrates.

															1. One glaring defect of the negative Commerce
Clause is its lack of governing principle. Neither the Constitution
nor our legal traditions offer guidance about how to sepa-rate
improper state interference with commerce from permissible state
taxation or regulation of commerce. So we must make the rules up as
we go along. That is how we ended up with the bestiary of
ad hoc tests and ad hoc exceptions that we apply
nowadays, including the substantial nexus test, the fair
apportionment test, and the fair relation test, Complete Auto
Transit, Inc. v. Brady , 430 U. S. 274, 279 (1977) ,
the interest-on-state-bonds exception, Department of Revenue of
Ky. v. Davis , 553 U. S. 328 –356 (2008), and the
sales-taxes-on-mail-orders exception, Quill Corp. , supra, at 314–319.

															The internal consistency rule invoked by the
Court nicely showcases our ad hocery. Under this rule, a tax
violates the Constitution if its hypothetical adoption by all
States would interfere with interstate commerce. Ante, at
19. How did this exercise in counterfactuals find its way into our
basic charter? The test, it is true, bears some resemblance to
Kant’s first formulation of the categorical imperative: “Act only
according to that maxim whereby you can at the same time will that
it should become a universal law” without contradiction. Grounding
for the Metaphysics of Morals 30 (J. Ellington transl. 3d ed.
1993). It bears no resemblance, however, to anything in the text or
structure of the Constitution. Nor can one discern an obligation of
internal consistency from our legal traditions, which show that
States have been imposing internally inconsistent taxes for quite a
while—until recently with our approval. See, e.g., General Motors Corp. v. Washington , 377 U. S.
436 (1964) (upholding internally inconsistent business activities
tax); Hinson v. Lott , 8 Wall. 148 (1869) (upholding
internally inconsistent liquor tax). No, the only justification for
the test seems to be that this Court disapproves of
“ ‘cross-border tax disadvantage[s]’ ” when created by
internally inconsistent taxes, but is willing to tolerate them when
created by “the interaction of . . . internally
consistent schemes.” Ante, at 19. “Whatever it is we are
expounding in this area, it is not a Constitution.” American
Trucking Assns., Inc. v. Smith , 496 U. S. 167, 203
(1990) (Scalia, J., concurring in judgment).

															2. Another conspicuous feature of the negative
Commerce Clause is its instability. Because no principle anchors
our development of this doctrine—and because the line between wise
regulation and burdensome interference changes from age to economic
age—one can never tell when the Court will make up a new rule or
throw away an old one. “Change is almost [the doctrine’s] natural
state, as it is the natural state of legislation in a constantly
changing national economy.” Ibid. Today’s decision continues in this proud
tradition. Consider a few ways in which it contradicts earlier
decisions:

															In an earlier case, the Court conceded
that a trucking tax “fail[ed] the ‘internal consistency’ test,” but
upheld the tax anyway. American Trucking Assns., Inc. v. Michigan Pub. Serv. Comm’n , 545 U. S. 429, 437 (2005) .
Now, the Court proclaims that an income tax “fails the internal
consistency test,” and for that reason strikes it down. Ante, at 21.

															In an earlier case, the Court concluded
that “[i]t is not a purpose of the Commerce Clause to protect state
residents from their own state taxes” and that residents could
“complain about and change the tax through the [State’s] political
process.” Goldberg v. Sweet , 488 U. S. 252, 266
(1989) . Now, the Court concludes that the negative Commerce Clause
operates “regardless of whether the plaintiff is a resident
. . . or nonresident” and that “the notion that
[residents] have a complete remedy at the polls is fanciful.” Ante, at 11, 12.

															In an earlier case, the Court said that
“[t]he difference in effect between a tax measured by gross
receipts and one measured by net income . . . is manifest
and substantial.” United States Glue Co. v. Town of Oak
Creek , 247 U. S. 321, 328 (1918) . Now, the Court says
that the “formal distinction” between taxes on net and gross income
“should [not] matter.” Ante , at 7.

															In an earlier case, the Court upheld a tax
despite its economic similarity to the gross-receipts tax struck
down in Central Greyhound Lines, Inc. v. Mealey , 334
U. S. 653 (1948) . Oklahoma Tax Comm’n v. Jefferson
Lines, Inc. , 514 U. S. 175 –191 (1995). The Court
explained that “economic equivalence alone has . . . not
been (and should not be) the touchstone of Commerce Clause
jurisprudence.” Id., at 196–197, n. 7. Now, the Court
strikes down a tax in part because of its economic similarity to
the gross-receipts tax struck down in Central Greyhound . Ante, at 7. The Court explains that “we must consider ‘not
the formal language of the tax statute but rather its practical
effect.’ ” Ante, at 7–8.

															So much for internal consistency.

															3. A final defect of our Synthetic Commerce
Clause cases is their incompatibility with the judicial role. The
doctrine does not call upon us to perform a conventional judicial
function, like interpreting a legal text, discerning a legal
tradition, or even applying a stable body of precedents. It instead
requires us to balance the needs of commerce against the needs of
state governments. That is a task for legislators, not judges.

															Today’s enterprise of eliminating double
taxation puts this problem prominently on display. The one sure way
to eliminate all double taxation is to prescribe uniform national
tax rules—for example, to allow taxation of income only where
earned. But a program of prescribing a national tax code plainly
exceeds the judicial competence. (It may even exceed the
legislative competence to come up with a uniform code that accounts
for the many political and economic differences among the States.)
As an alternative, we could consider whether a State’s taxes in
practice overlap too much with the taxes of other States. But any
such approach would drive us “to the perplexing inquiry, so unfit
for the judicial department, what degree of taxation is the
legitimate use, and what degree may amount to an abuse of power.” McCulloch v. Maryland , 4 Wheat. 316, 430 (1819). The
Court today chooses a third approach, prohibiting States from
imposing internally inconsistent taxes. Ante, at 19. But
that rule avoids double taxation only in the hypothetical world
where all States adopt the same internally consistent tax, not in
the real world where different States might adopt different
internally consistent taxes. For example, if Maryland imposes its
income tax on people who live in Maryland regardless of where they
work (one internally consistent scheme), while Virginia imposes its
income tax on people who work in Virginia regardless of where they
live (an-other internally consistent scheme), Marylanders who work
in Virginia still face double taxation. Post, at
17–18. Then again, it is only fitting that the Imaginary Commerce
Clause would lead to imaginary benefits.

															III

															For reasons of stare decisis , I will
vote to set aside a tax under the negative Commerce Clause if (but
only if) it discriminates on its face against interstate commerce
or cannot be distinguished from a tax this Court has already held
unconstitutional. American Trucking Assns. , 545 U. S.,
at 439 (Scalia, J., concurring in judgment). The income tax before
us does not discriminate on its face against interstate commerce; a
resident pays no less to Maryland when he works in Maryland than
when he works elsewhere. Neither is the tax before us
indistinguishable from one that we have previously held
unconstitutional. To the contrary, as the principal dissent
establishes, our prior cases validate this tax.

															*  *  *

															Maryland’s refusal to give residents full tax
credits against income taxes paid to other States has its
disadvantages. It threatens double taxation and encourages
residents to work in Maryland. But Maryland’s law also has its
advantages. It allows the State to collect equal revenue from
taxpayers with equal incomes, avoids the administrative burdens of
verifying tax payments to other States, and ensures that every
resident pays the State at least some income tax. Nothing in the
Constitution precludes Maryland from deciding that the benefits of
its tax scheme are worth the costs.

															I respectfully dissent. SUPREME COURT OF THE UNITED STATES

															_________________

															No. 13–485

															_________________

															COMPTROLLER OF THE TREASURY OF MARYLAND,
PETITIONER v. BRIAN WYNNE et ux.

															on writ of certiorari to the court of appeals
of maryland

															[May 18, 2015]

															Justice Thomas, with whom Justice Scalia joins
except as to the first paragraph, dissenting.

															“I continue to adhere to my view that the
negative Commerce Clause has no basis in the text of the
Constitution, makes little sense, and has proved virtually
unworkable in application, and, consequently, cannot serve as a
basis for striking down a state statute.” McBurney v. Young , 569 U. S. ___, ___ (2013) (Thomas, J.,
concurring) (slip op., at 1) (internal quotation marks and
alteration omitted); accord, e.g., Camps Newfound/Owatonna,
Inc. v. Town of Harrison , 520 U. S. 564 –612 (1997)
(Thomas, J., dissenting). For that reason, I would uphold
Maryland’s tax scheme.

															In reaching the contrary conclusion, the Court
proves just how far our negative Commerce Clause jurisprudence has
departed from the actual Commerce Clause. According to the
majority, a state income tax that fails to provide residents with
“a full credit against the income taxes that they pay to other
States” violates the Commerce Clause. Ante, at 1. That news
would have come as a surprise to those who penned and ratified the
Constitution. As this Court observed some time ago, “Income taxes
. . . were imposed by several of the States at or shortly
after the adoption of the Federal Constitution.” Shaffer v. Carter , 252 U. S. 37, 51 (1920) .[ 1 ]* There is no indication that those early state
income tax schemes provided credits for income taxes paid
elsewhere. Thus, under the majority’s reasoning, all of those state
laws would have contravened the newly ratified Commerce Clause.

															It seems highly implausible that those who
ratified the Commerce Clause understood it to conflict with the
income tax laws of their States and nonetheless adopted it without
a word of concern. That silence is particularly deafening given the
importance of such taxes for raising revenues at the time. See
Kinsman, The Income Tax in the Commonwealths of the United States
7, in 4 Publications of the American Economic Assn. (1903) (noting,
for example, that “Connecticut from her earliest history had
followed the plan of taxing incomes rather than property” and that
“[t]he total assessed value of [taxable] incomes in Connecticut in
the year 1795 was a little over $300,000” (internal quotation marks
omitted)).

															In other areas of constitutional analysis, we
would have considered these laws to be powerful evidence of the
original understanding of the Constitution. We have, for ex-ample,
relied on the practices of the First Congress to guide our
interpretation of provisions defining congressional power. See, e.g., Golan v. Holder , 565 U. S. ___, ___ (2012)
(slip op., at 16) (Copyright Clause); McCulloch v. Maryland , 4 Wheat. 316, 401–402 (1819) (Necessary and Proper
Clause). We have likewise treated “actions taken by the First
Congress a[s] presumptively consistent with the Bill of Rights,” Town of Greece v. Galloway , 572 U. S. ___, ___
(2014) (Alito, J., concurring) (slip op., at 12). See, e.g.,
id., at ___ – ___ (majority opinion) (slip op., at 7–8); Carroll v. United States , 267 U. S. 132 –152
(1925). And we have looked to founding-era state laws to guide our
understanding of the Constitution’s meaning. See, e.g., District
of Columbia v. Heller , 554 U. S. 570 –602 (2008) (
Second Amendment); Atwater v. Lago Vista , 532
U. S. 318 –340 (2001) ( Fourth Amendment); Roth v. United States , 354 U. S. 476 –483 (1957) ( First
Amendment); Kilbourn v. Thompson , 103 U. S. 168
–203 (1881) (Speech and Debate Clause); see also Calder v. Bull , 3 Dall. 386, 396–397 (1798) (opinion of Paterson, J.)
(Ex Post Facto Clause).

															Even if one assumed that the negative Commerce
Clause existed, I see no reason why it would be subject to a
different mode of constitutional interpretation. The majority
quibbles that I fail to “sho[w] that the small number of
individuals who earned income out of State were taxed twice on that
income,” ante, at 28, but given the deference we owe to the
duly enacted laws of a State—particularly those concerning the
paradigmatically sovereign activity of taxation—the burden of proof
falls on those who would wield the Federal Constitution to
foreclose that exercise of sovereign power.

															I am doubtful that the majority’s application of
one of our many negative Commerce Clause tests is correct under our
precedents, see ante, at 5–7 (Scalia, J., dissenting); post, at 10–19 (Ginsburg, J., dissenting), but I am certain
that the majority’s result is incorrect under our Constitution. As
was well said in another area of constitutional law: “[I]f there is
any inconsistency between [our] tests and the historic practice
. . . , the inconsistency calls into question the
validity of the test, not the historic practice.” Town of
Greece, supra, at ___ (Alito, J., concurring) (slip op., at
12).

															I respectfully dissent. Notes 1 * See, e.g., 1777–1778 Mass. Acts ch. 13, §2, p. 756 (taxing “the amount of
[inhabitants’] income from any profession, faculty, handicraft,
trade or employment; and also on the amount of all incomes and
profits gained by trading by sea and on shore”); 1781 Pa. Laws ch.
961, §12, p. 390 (providing that “[a]ll offices and posts of
profit, trades, occupations and professions (that of ministers of
the gospel of all denominations and schoolmasters only excepted),
shall be rated at the discretion of the township, ward or district
assessors . . . having due regard of the profits arising
from them”); see also Report of Oliver Wolcott, Jr., Secretary of
the Treasury, to 4th Cong., 2d Sess., concerning Direct Taxes
(1796), in 1 American State Papers, Finance 414, 423 (1832)
(describing Connecticut’s income tax as assessing, as relevant,
“the estimated gains or profits arising from any, and all,
lucrative professions, trades, and occupations”); id., at
429 (noting that, in Delaware, “[t]axes have been hitherto
collected on the estimated annual income of the inhabitants of this
State, without reference to specific objects”). SUPREME COURT OF THE UNITED STATES

															_________________

															No. 13–485

															_________________

															COMPTROLLER OF THE TREASURY OF MARYLAND,
PETITIONER v. BRIAN WYNNE et ux.

															on writ of certiorari to the court of appeals
of maryland

															[May 18, 2015]

															Justice Ginsburg, with whom Justice Scalia and
Justice Kagan join, dissenting.

															Today’s decision veers from a principle of
interstate and international taxation repeatedly acknowledged by
this Court: A nation or State “may tax all the income of its
residents, even income earned outside the taxing jurisdiction.” Oklahoma Tax Comm’n v. Chickasaw Nation , 515
U. S. 450 –463 (1995). In accord with this principle, the
Court has regularly rejected claims that taxes on a resident’s
out-of-state income violate the Due Process Clause for lack of a
sufficient “connection” to the taxing State. Quill Corp. v. North Dakota , 504 U. S. 298, 306 (1992) (internal
quotation marks omitted); see, e.g., Lawrence v. State Tax Comm’n of Miss. , 286 U. S. 276, 281 (1932) .
But under dormant Commerce Clause jurisprudence, the Court decides,
a State is not really empowered to tax a resident’s income from
whatever source derived. In taxing personal income, the Court
holds, source-based authority, i.e., authority to tax
commerce conducted within a State’s territory, boxes in the taxing
authority of a taxpayer’s domicile.

															As I see it, nothing in the Constitution or in
prior decisions of this Court dictates that one of two States, the
domiciliary State or the source State, must recede simply because
both have lawful tax regimes reaching the same income. See Moorman Mfg. Co. v. Bair , 437 U. S. 267 ,
n. 12 (1978) (finding no “discriminat[ion] against interstate
commerce” where alleged taxation disparities were “the consequence
of the combined effect” of two otherwise lawful income-tax
schemes). True, Maryland elected to deny a credit for income taxes
paid to other States in computing a resident’s county tax
liability. It is equally true, however, that the other States that
taxed the Wynnes’ income elected not to offer them a credit for
their Maryland county income taxes. In this situation, the
Constitution does not prefer one lawful basis for state taxation of
a person’s income over the other. Nor doesit require one State, in
this case Maryland, to limit its residence-based taxation, should
the State also choose to exercise, to the full extent, its
source-based authority. States often offer their residents credits
for income taxes paid to other States, as Maryland does for state
income tax purposes. States do so, however, as a matter of tax
“policy,” Chickasaw Nation , 515 U. S., at 463,
n. 12 (internal quotation marks omitted), not because the
Constitution compels that course.

															I

															For at least a century, “domicile” has been
recognized as a secure ground for taxation of residents’ worldwide
income. Lawrence , 286 U. S., at 279. “Enjoyment of the
privileges of residence within [a] state, and the attendant right
to invoke the protection of its laws,” this Court has explained,
“are inseparable from the responsibility for sharing the costs of
government.” Ibid. “A tax measured by the net income of
residents is an equitable method of distributing the burdens of
government among those who are privileged to enjoy its benefits.” New York ex rel. Cohn v. Graves , 300 U. S. 308,
313 (1937) .

															More is given to the residents of a State than
to those who reside elsewhere, therefore more may be demanded of
them. With this Court’s approbation, States have long favored their
residents over nonresidents in the provision of local services. See Reeves, Inc. v. Stake , 447 U. S. 429, 442 (1980)
(such favoritism does not violate the Commerce Clause). See also Martinez v. Bynum , 461 U. S. 321 (1983)
(upholding residency requirements for free primary and secondary
schooling). The cost of services residents enjoy is substantial.
According to the State’s Comptroller, for example, in 2012 Maryland
and its local governments spent over $11 billion to fund public
schools, $4 billion for state health programs, and $1.1 billion for
the State’s food supplemental program—all programs available to
residents only. Brief for Petitioner 20–23. See also Brief for
United States as Amicus Curiae 18 (Howard County—where the
Wynnes lived in 2006—budgeted more than $903 million for education
in fiscal year 2014). Excluding nonresidents from these services,
this Court has observed, is rational for it is residents “who fund
the state treasury and whom the State was created to serve.” Reeves , 447 U. S., at 442. A taxpayer’s home State,
then, can hardly be faulted for making support of local government
activities an obligation of every resident, regardless of any
obligations residents may have to other States.[ 1 ]

															Residents, moreover, possess political means,
not shared by outsiders, to ensure that the power to tax their
income is not abused. “It is not,” this Court has observed, “a
purpose of the Commerce Clause to protect state residents from
their own state taxes.” Goldberg v. Sweet , 488
U. S. 252, 266 (1989) . The reason is evident. Residents are
“insider[s] who presumably [are] able to complain about and change
the tax through the [State’s] political process.” Ibid .
Nonresidents, by contrast, are not similarly positioned to
“effec[t] legislative change.” Ibid . As Chief Justice
Marshall, developer of the Court’s Commerce Clause jurisprudence,
reasoned: “In imposing a tax the legislature acts upon its
constituents. This is in general a sufficient security against
erroneous and oppressive taxation.” McCulloch v. Maryland , 4 Wheat. 316, 428 (1819). The “people of a State”
can thus “res[t] confidently on the interest of the legislator, and
on the influence of the constituents over their representative, to
guard them against . . . abuse” of the “right of taxing
themselves and their property.” Ibid. [ 2 ]

															I hardly maintain, as the majority insistently
asserts I do, that “the Commerce Clause places no constraint on a
State’s power to tax” its residents. Ante, at 13. See also ante, at 11–15. This Court has not shied away from striking
down or closely scrutinizing state efforts to tax residents at a
higher rate for out-of-state activities than for in-state
activities (or to exempt from taxation only in-state activities).
See, e.g., Department of Revenue of Ky. v. Davis , 553
U. S. 328, 336 (2008) ; Camps Newfound/ Owatonna, Inc. v. Town of Harrison , 520 U. S. 564 (1997); Fulton
Corp. v. Faulkner , 516 U. S. 325 (1996) ; Bacchus Imports, Ltd. v. Dias , 468 U. S. 263,
272 (1984) . See also ante, at 11, and n. 3, 14–15
(mistakenly charging that under my analysis “all of these cases
would be thrown into doubt”). “[P]olitical processes” are ill
equipped to guard against such facially discriminatory taxes
because the effect of a tax of this sort is to “mollif[y]” some of
the “in-state interests [that] would otherwise lobby against” it. West Lynn Creamery, Inc. v. Healy , 512 U. S.
186, 200 (1994) . By contrast, the Court has generally upheld
“evenhanded tax[es] . . . in spite of any adverse effects
oninterstate commerce, in part because ‘[t]he existence of major
in-state interests adversely affected . . . is a powerful
safeguard against legislative abuse.’ ” Ibid. (citing, inter alia , Goldberg , 488 U. S., at 266). That
justification applies with full force to the “evenhanded tax”
challenged here, which taxes residents’ income at the same rate
whether earned in-state or out-of-state.[ 3 ]

															These rationales for a State taxing its
residents’ worldwide income are not diminished by another State’s
independent interest in “requiring contributions from
[nonresidents] who realize current pecuniary benefits under the
protection of the [State’s] government.” Shaffer v. Carter , 252 U. S. 37, 51 (1920) . A taxpayer living in
one State and working in another gains protection and benefits from
both—and so can be called upon to share in the costs of both
States’ governments.

															States deciding whether to tax residents’ entire
worldwide income must choose between legitimate but competing tax
policy objectives. A State might prioritize obtaining equal
contributions from those who benefit from the State’s protection in
roughly similar ways. Or a State might prioritize ensuring that its
taxpayers are not subject to double taxation. A State cannot,
however, accomplish both objectives at once.

															To illustrate, consider the Wynnes. Under the
tax scheme in place in 2006, other Howard County residents who
earned their income in-state but who otherwise had the same tax
profile as the Wynnes ( e.g., $2.67 million in taxable net
income) owed the same amount of taxes to Maryland as the
Wynnes. See App. to Pet. for Cert. A–56. The scheme thus ensured
that all residents with similar access to the State’s protection
and benefits and similar ability to pay made equal contributions to
the State to defray the costs of those benefits. Maryland could not
achieve that objective, however, without exposing the Wynnes to a
risk of double taxation. Conversely, the Court prioritizes reducing
the risk that the Wynnes’ income will be taxed twice by two
different States. But that choice comes at a cost: The Wynnes
enjoyed equal access to the State’s services but will have paid
$25,000 less to cover the costs of those services than similarly
situated neighbors who earned their income entirely within the
State. See Pet. for Cert. 15.

															States confront the same trade-off when deciding
whether to tax nonresidents’ entire in-state income. A State can
require all residents and nonresidents who work within the State
under its protection to contribute equally to the cost of that
protection. Or the State can seek to avoid exposing its workers to
any risk of double taxation. But it cannot achieve both
objectives.

															For at least a century, responsibility for
striking the right balance between these two policy objectives has
belonged to the States (and Congress), not this Court. Some States
have chosen the same balance the Court embraces today. See ante, at 17. But since almost the dawn of the modern era of
state income taxation, other States have taken the same approach as
Maryland does now, taxing residents’ entire income, wherever
earned, while at the same time taxing nonresidents’ entire in-state
income. And recognizing that “[p]rotection, benefit, and power over
[a taxpayer’s income] are not confined to either” the State of
residence or the State in which income is earned, this Court has
long afforded States that flexibility. Curry v. McCanless , 307 U. S. 357, 368 (1939) . This history of
States imposing and this Court upholding income tax schemes
materially identical to the one the Court confronts here should be
the beginning and end of this case.

															The modern era of state income taxation dates
from a Wisconsin tax enacted in 1911. See 1911 Wis. Laws ch. 658;
R. Blakey, State Income Taxation 1 (1930). From close to the start
of this modern era, States have taxed residents and nonresidents in
ways materially indistinguishable from the way Maryland does now.
In 1915, for example, Oklahoma began taxing residents’ “entire net
income . . . arising or accruing from all sources,” while at the same time taxing nonresidents’ “entire net
income from [sources] in th[e] State.” 1915 Okla. Sess. Laws
ch. 164, §1, pp. 232–233 (emphasis added). Like Maryland
today, Oklahoma provided no credit to either residents or
nonresidents for taxes paid elsewhere. See id. ,
ch. 164, §1 et seq. , at 232–237. In 1917,
neighboring Missouri adopted a similar scheme: Residents owed taxes
on their “entire net income . . . from all sources” and nonresidents owed taxes on their “entire net income
. . . from all sources within th[e] state.” 1917 Mo. Laws
§1(a), pp. 524–525 (emphasis added). Missouri too provided neither
residents nor nonresidents a credit for taxes paid to other
jurisdic-tions. See id. , §1 et seq. , at 524–538.
Thus, much like Maryland today, these early income tax adopters
simultaneously taxed residents on all income, wherever
earned, and nonresidents on all income earned within the
State.[ 4 ]

															Almost immediately, this Court began issuing
what became a long series of decisions, repeatedly upholding
States’ authority to tax both residents’ worldwide income and
nonresidents’ in-state income. E.g., Maguire v. Trefry , 253 U. S. 12, 17 (1920) (resident income tax); Shaffer , 252 U. S., at 52–53, 57 (nonresident income
tax). See also State Tax Comm’n of Utah v. Aldrich ,
316 U. S. 174, 178 (1942) ; Curry , 307 U. S., at
368; Guaranty Trust Co. v. Virginia , 305 U. S.
19, 23 (1938) ; Graves , 300 U. S., at 313; Lawrence , 286 U. S., at 281. By the end of the 20th
cen-tury, it was “a well-established principle of interstate and
international taxation” that “sovereigns have authority to tax all
income of their residents, including income earned outside their
borders,” Chickasaw Nation , 515 U. S., at 462, 463,
n. 12, and that sovereigns generally may also tax nonresidents
on “income earned within the [sovereign’s] jurisdiction,” id., at 463, n. 11.

															Far from suggesting that States must choose
between taxing residents or nonresidents, this Court specifically
affirmed that the exact same “income may be taxed [si-multaneously] both by the state where it is earned and by the state
of the recipient’s domicile.” Curry , 307 U. S., at 368
(emphasis added). See also Aldrich , 316 U. S., at
176–178, 181 (rejecting “a rule of immunity from taxation by more
than one state,” including with respect to income taxation
(internal quotation marks omitted)). In Lawrence , for
example, this Court dealt with a Mississippi tax “scheme” with the
same structure Maryland has today: Mississippi taxed residents on
all income, wherever earned, and nonresidents on income earned
within the State, without providing either set of taxpayers a
credit for taxes paid elsewhere. See 286 U. S., at 278–279;
Miss. Code Ann. §5033(a), (b)(9) (1930). Lawrence upheld a
Mississippi tax on net income earned by one of its residents on the
construction of public highways in Tennessee. See 286 U. S.,
at 279–281. The Court did so fully aware that both Mississippi and
Tennessee were effectively imposing “an income tax upon the same
occupation.” Reply Brief in Lawrence v. State Tax Comm’n
of Miss. , O. T. 1931, No. 580, p. 32. See also Curry , 307 U. S., at 363, n. 1, 368 (discussing Lawrence ).

															Likewise, in Guaranty Trust , both New
York and Vir-ginia had taxed income of a New York trust that had
been distributed to a Virginia resident. 305 U. S., at 21–22.
The resident sought to block Virginia’s tax in order to avoid
“double taxation” of the “identical income.” Id. , at 22.
Rejecting that challenge, the Court once again reiterated that “two
States” may simultaneously tax the “same income.” Ibid. The majority deems these cases irrelevant
because they involved challenges brought under the Due Process
Clause, not the Commerce Clause. See ante, at 12–15. These
cases are significant, however, not because the constraints imposed
by the two Clauses are identical. Obviously, they are not. See Quill Corp. , 504 U. S., at 305. What the sheer volume
and consistency of this precedent confirms, rather, is the degree
to which this Court has—until now—endorsed the “well-established
principle of interstate and international taxation” that a State
may tax its residents’ worldwide income, without restriction
arising from the source-based taxes imposed by other States and
regardless of whether the State also chooses to impose source-based
taxes of its own. Chickasaw Nation , 515 U. S., at
462.[ 5 ]

															In any event, it is incorrect that support for
this principle is limited to the Court’s Due Process Clause cases.
In Shaffer , for example, this Court rejected both a
Due Process Clause challenge and a dormant Commerce Clause
challenge to an income tax “scheme” (the Oklahoma statute described
above) with the very features the majority latches onto today:
Oklahoma taxed residents on all worldwide income and nonresidents
on all in-state income, without providing a credit for taxes paid
elsewhere to either residents or nonresidents. 252 U. S., at
52–53 (Due Process challenge); id., at 57 (dormant Commerce
Clause challenge). See also supra , at 7. The specific tax
challenged in Shaffer —a tax on a nonresident’s in-state
income—exposed taxpayers to the same risk of double taxation as the
Maryland tax challenged in this case. The majority labors mightily
to distinguish Shaffer , but it does not dispute the one
thing that ought to give it pause: Today’s decision overrules Shaffer ’s dormant Commerce Clause holding. See ante, at 15–16. I would not discard our precedents so lightly. Just as
the tax in Shaffer encountered no constitutional shoals, so
Maryland’s scheme should survive the Court’s inspection.

															This Court’s decision in West Publishing
Co. v. McColgan , 328 U. S. 823 (1946) , reinforces
that conclusion. In West Publishing , the Court summarily
affirmed a decision of the California Supreme Court that denied a
dormant Commerce Clause challenge based on the principles today’s
majority disrespects:

															“[T]here [is no] merit to the contention
that [California’s tax] discriminates against interstate commerce
on the ground that it subjects part of plaintiff’s income to double
taxation, given the taxability of plaintiff’s entire net income in
the state of its domicile. Taxation in one state is not an
immunization against taxation in other states. Taxation by states
in which a corporation carries on business activities is justified
by the advantages that attend the pursuit of such activities.
Income may be taxed both by the state where it is earned and by the
state of the recipient’s domicile. Protection, benefit and power
over the subject matter are not confined to either state.” 27 Cal.
2d 705, 710–711, 166 P. 2d 861, 864 (1946) (citations and
internal quotation marks omitted).

															In treating the matter summarily, the Court
rejected an argument strikingly similar to the one the majority now
embraces: that California’s tax violated the dormant Commerce
Clause because it subjected “interstate commerce . . . to
the risk of a double tax burden.” Brief for Appellant Opposing
Motion to Dismiss or Affirm in West Publishing Co. v. McColgan , O. T. 1945, No. 1255, pp. 20–21 (quoting J. D. Adams Mfg. Co. v. Storen , 304 U. S. 307,
311 (1938) ).

															The long history just recounted counsels in
favor of respecting States’ authority to tax without discount its
residents’ worldwide income. As Justice Holmes stated over a
century ago, in regard to a “mode of taxation . . . of
long standing, . . . the fact that the system has been in
force for a very long time is of itself a strong reason
. . . for leaving any improvement that may be desired to
the legislature.” Paddell v. City of New York , 211
U. S. 446, 448 (1908) . Only recently, this Court followed
that sound advice in resisting a dormant Commerce Clause challenge
to a taxing practice with a pedigree as enduring as the practice in
this case. See Department of Revenue of Ky. v. Davis ,
553 U. S. 328 –357 (2008) (quoting Padell , 211
U. S., at 448). Surely that advice merits application here,
where the challenged tax draws support from both historical
practice and numerous decisions of this Court.

															The majority rejects Justice Holmes’ counsel,
observing that most States, over time, have chosen not to exercise
plenary authority to tax residents’ worldwide income. See ante, at 17–18. The Court, however, learns the wrong lesson
from the “independent policy decision[s]” States have made. Chickasaw , 515 U. S., at 463, n. 12 (emphasis
added; internal quotation marks omitted). This history demonstrates
not that States “doub[t]” their “constitutiona[l]” authority to tax
residents’ income, wherever earned, as the majority speculates, ante, at 18, but that the very political processes the Court
disregards as “fanciful,” ante, at 12, have in fact worked
to produce policies the Court ranks as responsible—all the more
reason to resist this Court’s heavy-handed supervision.

															The Court also attempts to deflect the force of
this his-tory and precedent by relying on a “trilogy” of decisions
it finds “particularly instructive.” Ante, at 6–7 (citing Central Greyhound Lines, Inc. v. Mealey , 334 U. S.
653 (1948) ; Gwin, White & Prince, Inc. v. Henneford , 305 U. S. 434 (1939) ; J. D. Adams Mfg. ,
304 U. S. 307 ). As the majority acknowledges, however, those three
decisions involved gross receipts taxes, not income taxes. Ante, at 7–9. True, this Court has recently pointed to
similarities between these two forms of taxation. See ante, at 9. But it is an indulgence in wishful thinking to say that this
Court has previously “rejected the argument that the Commerce
Clause distinguishes between” these taxes. Ante , at
9 . For decades—including the years when the majority’s
“trilogy” was decided—the Court has routinely maintained that “the
difference between taxes on net income and taxes on gross receipts
from interstate commerce warrants different results” under the
Commerce Clause. C. Trost & P. Hartman, Federal Limitations on
State and Local Taxation 2d §10:1 (2003).

															In Shaffer , for example, the Court
rejected the taxpayer’s dormant Commerce Clause challenge because “the tax [was] imposed not upon gross receipts
. . . but only upon the net proceeds.” 252 U. S., at
57. Just three years before deciding J. D. Adams , the Court
emphasized “manifest and substantial” differences between the two
types of taxes, calling the burden imposed by a gross receipts tax
“direct and immediate,” in contrast to the “indirect and
incidental” burden imposed by an income tax. Stewart Dry Goods
Co. v. Lewis , 294 U. S. 550, 558 (1935) (quoting United States Glue Co. v. Town of Oak Creek , 247
U. S. 321, 328 (1918) ). And the Gwin, White opinion
observed that invalidating the gross receipts tax at issue “left to
the states wide scope for taxation of those engaged in interstate
commerce, extending to . . . net income derived from
it .” 305 U. S., at 441 (emphasis added).

															The majority asserts that this Court “rejected”
this distinction in Moorman Mfg . See ante, at 9. That
decision in fact described gross receipts taxes as “more
burdensome” than income taxes—twice. 437 U. S., at 280, 281.
In particular, Moorman upheld a state income tax because an
earlier decision had upheld a similar but “inherently more
burdensome” gross receipts tax. Id., at 281. To say that the
constitutionality of an income tax follows a fortiori from the constitutionality of a similar but “more burdensome” gross
receipts tax is to affirm , not reject, a distinction between
the two.

															The Justices participating in the Court’s
“trilogy,” in short, would scarcely expect to see the three
decisions invoked to invalidate a tax on net income.

															II

															Abandoning principles and precedent sustaining
simultaneous residence- and source-based income taxation, the Court
offers two reasons for striking down Maryland’s county income tax:
(1) the tax creates a risk of double taxation, ante, at 7,
18; and (2) the Court deems Maryland’s income tax “scheme”
“inherently discriminatory”—by which the Court means, the scheme
fails the so-called “internal consistency” test, ante, at
21–22. The first objection is overwhelmed by the history, recounted
above, of States imposing and this Court upholding income taxes
that carried a similar risk of double taxation. See supra, at 6–12. The Court’s reliance on the internal consistency test is
no more compelling.

															This Court has not rigidly required States to
maintain internally consistent tax regimes. Before today, for two
decades, the Court has not insisted that a tax under review pass
the internal consistency test, see Oklahoma Tax Comm’n v. Jefferson Lines, Inc. , 514 U. S. 175, 185 (1995) , and
has not struck down a state tax for failing the test in nearly 30
years, see American Trucking Assns., Inc. v. Scheiner , 483 U. S. 266 –287 (1987) ( ATA I ); Tyler Pipe Industries, Inc. v. Washington State Dept. of
Revenue , 483 U. S. 232 –248 (1987). Moreover, the Court
has rejected challenges to taxes that flunk the test. The Oklahoma
tax “scheme” upheld under the dormant Commerce Clause in Shaffer , for example, is materially indistinguishable
from—therefore as internally inconsistent as—Maryland’s scheme. 252
U. S., at 57. And more recently, in American Trucking
Assns., Inc. v. Michigan Pub. Serv. Comm’n , the Court
upheld a “concede[dly]” internally inconsistent state tax. 545
U. S. 429, 438 (2005) ( ATA II ). The Court did so,
satisfied that there was a sufficiently close connection between
the tax at issue and the local conduct that triggered the tax. See ibid. [ 6 ]

															The logic of ATA II , counsel for the
Wynnes appeared to recognize, see Tr. of Oral Arg. 46–47, would
permit a State to impose a head tax— i.e., a flat charge
imposed on every resident in the State—even if that tax were part
of an internally inconsistent tax scheme. Such a tax would rest on
purely local conduct: the taxpayer’s residence in the taxing State.
And the taxes paid would defray costsclosely connected to that
local conduct—the services used by the taxpayer while living in the
State.

															I see no reason why the Constitution requires us
to disarm States from using a progressive tax, rather than a flat
toll, to cover the costs of local services all residents enjoy. A
head tax and a residence-based income tax differ, do they not, only
in that the latter is measured by each taxpayer’s ability to pay.
Like the head tax, however, a residence-based income tax is
triggered by the purely local conduct of residing in the State. And
also like the head tax, a residence-based income tax covers costs
closely connected to that residence: It finances services used by
those living in the State. If a head tax qualifies for ATA
II’ s reprieve from internal consistency, then so too must a
residence-based income tax.

															The majority asserts that because Maryland’s tax
scheme is internally inconsistent, it “operates as a tariff,”
making it “ ‘patently unconstitutional.’ ” Ante, at 22. This is a curious claim. The defining characteristic of a
tariff is that it taxes interstate activity at a higher rate than
it taxes the same activity conducted within the State. See West
Lynn Creamery , 512 U. S., at 193. Maryland’s resident
income tax does the exact opposite: It taxes the income of its
residents at precisely the same rate, whether the income is earned
in-state or out-of-state.[ 7 ]

															There is, moreover, a deep flaw in the Court’s
chosen test. The Court characterizes internal consistency as a
“cure,” ante, at 18, 25–26, but the test is scarcely that,
at least for the double taxation the Court believes to justify its
intervention. According to the Court, Maryland’s tax “scheme” is
internally inconsistent because Maryland simultaneously imposes two
taxes: the county income tax and the special nonresident tax. See ante, at 7, 21–22, and n. 8. But only one of these
taxes—the county income tax—actually falls on the Wynnes. Because
it is the interaction between these two taxes that renders
Maryland’s tax scheme internally inconsistent, Maryland could
eliminate the inconsistency by terminating the special nonresident
tax—a measure that would not help the Wynnes at all.[ 8 ] Maryland could, in other words, bring
itself into compliance with the test at the heart of the Court’s
analysis without removing the double tax burden the test is
pur-portedly designed to “cure.”

															To illustrate this oddity, consider the Court’s
“simple example” of April (who lives and works in State A) and Bob
(who lives in State A, but works in State B). Ante, at
21–22, 25. Both States fail the internal consistency test because
they impose (1) a 1.25% tax on income that residents earn in-state,
(2) a 1.25% tax on income that residents earn in other
jurisdictions, and (3) a 1.25% tax on income that nonresidents
earn in-state. According to the Court, these tax schemes are
troubling because “Bob will pay more income tax than April solely
because he earns income interstate.” Ante, at 22.

															Each State, however, need not pursue the same
approach to make their tax schemes internally consistent.[ 9 ] See ante, at 25–26. State A
might choose to tax residents’ worldwide income only, which it
could do by eliminating tax #3 (on nonresidents’ in-state income).
State B might instead choose exclusively to tax income earned
within the State by deleting tax #2 (on residents’ out-of-state
income). Each State’s tax scheme would then be internally
consistent. But the tax burden on April and Bob would remain
unchanged: Just as under the original schemes, April would have to
pay a 1.25% tax only once, to State A, and Bob would have to pay a
1.25% tax twice: once to State A, where he resides, and once to
State B, where he earns the income. The Court’s “cure,” in other
words, is no match for the perceived disease.[ 10 ]

															The Court asserts that this flaw is just a
“truism” of every discrimination case, whether brought under the
dormant Commerce Clause or the Equal Protection Clause. Ante, at 26. That is simply incorrect. As the Court
acknowledges, a government that impermissibly “treats like cases
differently” ( i.e., discriminates) can ordinarily cure the
violation either by “leveling up” or “leveling down.” Ibid. (internal quotation marks omitted). Consider another April and Bob
example. If Bob must pay a 10% tax and April must pay a 5% tax,
that discrimination can be eliminated either by requiring both to
pay the 10% tax (“leveling up”) or by requiring both to pay
the 5% tax (“leveling down”). True, “leveling up” leaves Bob’s tax
bill unchanged. “Leveling up” nonetheless benefits Bob because it
eliminates the unfairness of being treated differently. And if, as
is often true in dormant Commerce Clause cases, April and Bob
compete in the same market, then “leveling up” provides the
concrete benefit of placing a new burden on Bob’s competitors.

															The majority’s rule does not work this way. As
just explained, Maryland can “cure” what the majority deems
discrimination without lowering the Wynnes’ taxes or increasing the tax burden on any of the Wynnes’ neighbors—by
terminating the special nonresident tax. See supra, at
16–17. The State can, in other words, satisfy the majority not by
lowering Bob’s taxes or by raising April’s taxes, but by
eliminating the taxes imposed on yet a third taxpayer (say, Cathy).
The Court’s internal consis-tency test thus scarcely resembles
“ordinary” anti-discrimination law. Whatever virtue the internal
consistency test has in other contexts, this shortcoming makes it a
poor excuse for jettisoning taxation principles as entrenched as
those here.

															*  *  *

															This case is, at bottom, about policy choices:
Should States prioritize ensuring that all who live or work within
the State shoulder their fair share of the costs of government? Or
must States prioritize avoidance of double taxation? As I have
demonstrated, supra, at 16–19, achieving even the latter
goal is beyond this Court’s competence. Resolving the competing tax
policy considerations this case implicates is something the Court
is even less well equipped to do. For a century, we have recognized
that state legislatures and the Congress are constitutionally
assigned and institutionally better equipped to balance such
issues. I would reverse, so that we may leave that task where it
belongs. Notes 1 The Court offers no
response to this reason for permitting a State to tax its
residents’ worldwide income, other than to urge that Commerce
Clause doctrine ought not favor corporations over individuals. See ante, at 10–11. I scarcely disagree with that proposition
(nor does this opinion suggest otherwise). But I fail to see how it
answers, or is even relevant to, my observation that affording
residents greater benefits entitles a State to require that they
bear a greater tax burden. 2 The majority dismisses
what we said in Goldberg v. Sweet , 488 U. S. 252
(1989) , as “dictum” allegedly “repudiated” by the Court in West
Lynn Creamery, Inc. v. Healy , 512 U. S. 186, 203
(1994) . Ante, at 11–12. That is doubly wrong. In Goldberg , we distinguished the tax struck down in American Trucking Assns., Inc. v. Scheiner , 483
U. S. 266 (1987) ( ATA I ), noting, in particular, that
the tax in ATA I fell on “out-of-state[rs]” whereas the tax
in Goldberg fell on “the insider who presumably is able to
complain about and change the tax through the Illinois political
process.” 488 U. S., at 266. Essential to our holding, this
rationale cannot be written off as “dictum.” As for West Lynn
Creamery , far from “repudiat[ing]” Goldberg , the Court cited Goldberg and reaffirmed its political
safeguards rationale, as explained below. See infra this
page and 5. 3 Given the pedigree of
this rationale, applying it here would hardly “work a sea change in
our Commerce Clause jurisprudence.” Ante, at 14. See United Haulers Assn., Inc. v. Oneida-Herkimer Solid Waste
Management Authority , 550 U. S. 330 , n. 7 (2007); Goldberg , 488 U. S., at 266; Minnesota v. Clover Leaf Creamery Co. , 449 U. S. 456 , n. 17
(1981); Raymond Motor Transp., Inc. v. Rice , 434
U. S. 429, 444, n. 18 (1978) ; South Carolina Highway
Dept. v. Barnwell Brothers, Inc. , 303 U. S. 177,
187 (1938) . Nor would applying the rationale to a net income tax
cast “doubt” on the Court’s gross receipts precedents, ante, at 14–15, given the Court’s longstanding practice of evaluating
income and gross receipt taxes differently, see infra , at
12–14. 4 Unlike Maryland’s county
income tax, these early 20th-century income taxes allowed a
deduction for taxes paid to other jurisdictions. Compare App. 18
with 1917 Mo. Laws §5, pp. 526–527, and 1915 Okla. Sess. Laws §6,
p. 234. The Wynnes have not argued and the majority does not
suggest, however, that Maryland could fully cure the asserted
defects in its tax “scheme” simply by providing a deduction, in
lieu of a tax credit. And I doubt that such a deduction would give
the Wynnes much satisfaction: Deducting taxes paid to other States
from the Wynnes’ $2.67 million taxable net income would reduce
their Maryland tax burden by a small fraction of the $25,000 tax
credit the majority awards them. See Pet. for Cert. 15; App. to
Pet. for Cert. A–56. 5 Upholding Maryland’s
facially neutral tax hardly means, as the majority contends, ante, at 12, that the dormant Commerce Clause places no
limits on States’ authority to tax residents’ worldwide income.
There are, for example, no well-established principles of
interstate and international taxation permitting the kind of
facially discriminatory tax the majority “[i]magine[s]” a State
enacting. Ibid . Nor are the political processes noted above
an adequate safeguard against such a tax. See supra, at
3–5. 6 The majority reads American Trucking Assns., Inc. v. Michigan Pub. Serv.
Comm’n , 545 U. S. 429 (2005) ( ATA II ), in a way so
implausible, it must resort to quoting from an amicus brief,
rather than from the Court’s opinion. According to the majority,
this Court did not think the challenged tax failed the
internal consistency test in ATA II , it held only that the
challengers had failed to make the necessary “empirical showing.”
See ante, at 20–21, n. 7. It is true that the United
States made that argument. See Brief for United States as Amicus
Curiae in ATA II , O. T. 2004, No. 03–1230, p. 26.
But one searches the U. S. Reports in vain for any indication
that the Court adopted it. Which is hardly surprising, for one
would scarcely think that a test turning on “ hypothetically ”
assessing a tax’s “structure,” ante, at 19 (emphasis added),
would require empirical data. What the Court in fact said in ATA
II , is that the tax’s internal inconsistency would be excused because any multiple taxation resulting from every
State adopting the challenged tax would be caused by interstate
firms’ choosing to “engag[e] in local business in all those
States.” 545 U. S., at 438. 7 The majority faults the
dissents for not “disput[ing]” its “economic analysis,” but beyond
citation to a pair of amicus briefs, its opinion offers no
analysis to dispute. Ante, at 22. 8 Or Maryland could provide
nonresidents a credit for taxes paid to other jurisdictions on
Maryland source income. Cf. ante, at 25–26. 9 I do not “clai[m]” as the
Court groundlessly suggests, that the Court’s analysis
“establish[es] . . . [a] rule of priority” between
residence- and source-based taxation. Ante, at 25–26. My
objection, rather, is that the Court treats source-based authority
as “box[ing] in” a State’s discrete authority to tax on the basis
of residence. Supra, at 1. There is no “inconsisten[cy]” in
my analysis, and the majority plainly errs in insisting that there
is. Ante, at 25. 10 Attempting to preserve the test’s
qualification as a “cure,” the Court redefines the illness as not
just double taxation but double taxation caused by an “inherently
discriminat[ory]” tax “scheme.” Ante, at 19–20. Relying on
such a distinction to justify the test is entirely circular,
however, as the Court defines “inherent discrimination” in this
case as internal inconsistency. In any event, given the concern
that purportedly drives the Court’s analysis, it is mystifying why
the Court sees “virtue” in striking down only one of the two
schemes under which Bob is taxed twice. Ante, at 19.
Whatever disincentive the original scheme creates for Bob (or the
Wynnes) to work in interstate commerce is created just as much by
the revised scheme that the Court finds satisfactory.