Quill Corp. v. North Dakota, 504 U.S. 298, 19 (1992)

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316

QUILL CORP. v. NORTH DAKOTA

Opinion of the Court

taxation." Northwestern States Portland Cement Co. v. Minnesota, 358 U. S. 450, 457-458 (1959).

Moreover, a bright-line rule in the area of sales and use taxes also encourages settled expectations and, in doing so, fosters investment by businesses and individuals.9 Indeed, it is not unlikely that the mail-order industry's dramatic growth over the last quarter century is due in part to the bright-line exemption from state taxation created in Bellas Hess.

Notwithstanding the benefits of bright-line tests, we have, in some situations, decided to replace such tests with more contextual balancing inquiries. For example, in Arkansas Electric Cooperative Corp. v. Arkansas Pub. Serv. Comm'n, 461 U. S. 375 (1983), we reconsidered a bright-line test set forth in Public Util. Comm'n of R. I. v. Attleboro Steam & Electric Co., 273 U. S. 83 (1927). Attleboro distinguished between state regulation of wholesale sales of electricity, which was constitutional as an "indirect" regulation of interstate commerce, and state regulation of retail sales of electricity, which was unconstitutional as a "direct regulation" of commerce. In Arkansas Electric, we considered whether to

9 It is worth noting that Congress has, at least on one occasion, followed a similar approach in its regulation of state taxation. In response to this Court's indication in Northwestern States Portland Cement Co. v. Minnesota, 358 U. S. 450, 452 (1959), that, so long as the taxpayer has an adequate nexus with the taxing State, "net income from the interstate operations of a foreign corporation may be subjected to state taxation," Congress enacted Pub. L. 86-272, codified at 15 U. S. C. 381. That statute provides that a State may not impose a net income tax on any person if that person's "only business activities within such State [involve] the solicitation of orders [approved] outside the State [and] filled . . . outside the State." Ibid. As we noted in Heublein, Inc. v. South Carolina Tax Comm'n, 409 U. S. 275, 280 (1972), in enacting 381, "Congress attempted to allay the apprehension of businessmen that 'mere solicitation' would subject them to state taxation. . . . Section 381 was designed to define clearly a lower limit for the exercise of [the State's power to tax]. Clarity that would remove uncertainty was Congress' primary goal." (Emphasis supplied.)

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