72
Opinion of the Court
Stevens, J., delivered the opinion of the Court, in which White, O'Connor, Scalia, Kennedy, Souter, and Thomas, JJ., joined. Rehnquist, C. J., filed a dissenting opinion, in which Blackmun, J., joined, post, p. 82.
Jerome B. Libin argued the cause for petitioner. With him on the briefs were Kathryn L. Moore and John V. Donnelly.
Marcia Mason, Assistant Attorney General of Iowa, argued the cause for respondent. With her on the brief were Bonnie J. Campbell, Attorney General, and Harry M. Griger, Special Assistant Attorney General.
Kent L. Jones argued the cause for the United States as
amicus curiae urging affirmance. With him on the brief were Solicitor General Starr, Acting Assistant Attorney General Bruton, Deputy Solicitor General Wallace, Gary R. Allen, and Ernest J. Brown.*
Justice Stevens delivered the opinion of the Court. In 1981 petitioner Kraft General Foods, Inc. (Kraft), operated a unitary business throughout the United States and in several foreign countries. Because part of its business was conducted in Iowa, Kraft was subject to the Iowa Business Tax on Corporations.1 At issue in this case is Iowa's inclusion in the tax base of the dividends that Kraft received from six subsidiaries, each of which was incorporated and conducted its business in a foreign country.2 While Iowa taxes
*Briefs of amici curiae urging reversal were filed for Avon Products, Inc., et al. by Timothy B. Dyk, Edward K. Bilich, and Maryann B. Gall; for Chevron Corp. et al. by Mark L. Evans, Alan I. Horowitz, and Anthony F. Shelley; and for the Washington Legal Foundation by Stephan G. Weil, Susan G. Braden, Daniel J. Popeo, and Paul D. Kamenar. Richard Ruda, Michael G. Dzialo, Martin Lobel, and James F. Flug
filed a brief for the National Conference of State Legislatures et al. as amici curiae urging affirmance.
1 Iowa Code § 422.32 et seq. (1981).
2 See App. to Pet. for Cert. 29a. Kraft owned capital stock representing more than 80% of the voting power and of the total value of the subsidiaries. Ibid.
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