Cite as: 514 U. S. 175 (1995)
Opinion of the Court
Freight Tax, 15 Wall. 232, 278 (1873), but would allow a tax merely measured by gross receipts from interstate commerce as long as the tax was formally imposed upon franchises, Maine v. Grand Trunk R. Co., 142 U. S. 217 (1891), or " 'in lieu of all taxes upon [the taxpayer's] property,' " United States Express Co. v. Minnesota, 223 U. S. 335, 346 (1912).4 See generally Lockhart, Gross Receipts Taxes on Interstate Transportation and Communication, 57 Harv. L. Rev. 40, 43-66 (1943) (hereinafter Lockhart). Dissenting from this formal approach in 1927, Justice Stone remarked that it was "too mechanical, too uncertain in its application, and too remote from actualities, to be of value." Di Santo v. Pennsylvania, 273 U. S. 34, 44 (1927) (dissenting opinion).
In 1938, the old formalism began to give way with Justice Stone's opinion in Western Live Stock v. Bureau of Revenue, 303 U. S. 250, which examined New Mexico's franchise tax, measured by gross receipts, as applied to receipts from outof-state advertisers in a journal produced by taxpayers in New Mexico but circulated both inside and outside the State. Although the assessment could have been sustained solely on prior precedent, see id., at 258; Lockhart 66, and n. 122, Justice Stone added a dash of the pragmatism that, with a brief interlude, has since become our aspiration in this quarter of the law. The Court had no trouble rejecting the claim that the "mere formation of the contract between persons in different states" insulated the receipts from taxation, Western Live Stock, 303 U. S., at 253, and it saw the business of "preparing, printing and publishing magazine advertising [as] peculiarly local" and therefore subject to taxation by the
4 The Court had indeed temporarily adhered to an additional distinction between taxes upon interstate commerce such as that struck down in the Case of State Freight Tax, and taxes upon gross receipts from such commerce, which were upheld that same Term in State Tax on Railway Gross Receipts, 15 Wall. 284 (1873). This nice distinction was abandoned prior to the New Jersey Bell case in Philadelphia & Southern S. S. Co. v. Pennsylvania, 122 U. S. 326 (1887).
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