Halliburton Oil Well Cementing Company v. Reily (1961)
- Docket
- 24
- Decided
- 1961-01-01
- Category
- General
Summary
Question: Does the Louisiana use tax violate the Commerce Clause as applied to Halliburton? Conclusion: Yes. Chief Justice Earl Warren, writing for a 7-2 majority, reversed the Louisiana Supreme Court. Calculating the Louisiana use tax using labor costs creates an unequal tax burden on similarly situated in-state and out-of-state tax payers. While the inequality may have been a mistake in drafting, it creates a substantial burden on taxpayers who manufacture goods out of state for use in Louisiana. Justice William J. Brennan concurred, objecting to the use tax because of its discriminatory nature, not because it created unequal tax burdens. Justice Tom C. Clark dissented, arguing that the proper comparison is between use taxes on equipment assembled out of state and sales taxes on equipment sold in the state. Using this comparison there is no discrimination. Justice Hugo L. Black joined in the dissent.