878
MACHINES CORP.
Kennedy, J., dissenting
Clause or reliance on the outmoded reasoning of Thames & Mersey.
We have discarded, in Import-Export Clause cases, the idea afoot in Hvoslef and Thames & Mersey that a tax on services necessary to the export process is equivalent to a tax on goods. In Canton R. Co. v. Rogan, 340 U. S. 511 (1951), the Court upheld a state gross-receipts tax on a steam railroad, even as applied to the railroad's handling of exports and imports from its marine terminal in the port of Baltimore. The tax was "not on the goods but on the handling of them at the port," we said, and "when the tax is on activities connected with the export or import the range of immunity cannot be so wide." Id., at 514-515. Following Canton, the Court in Washington Stevedoring decided that taxes on services may be permissible even if levied upon an activity, such as stevedoring, which occurs while imports and exports are in transit. We remarked: "The transportation services in both settings are necessary to the import-export process. Taxation in neither setting relates to the value of the goods, and therefore in neither can it be considered taxation upon the goods themselves." 435 U. S., at 757. The distinctions drawn between services and goods in those cases did not depend on the differences between the text of the Export and Import-Export Clauses, and should be observed here.
The Court's effort to justify its decision on the grounds of stare decisis, ante, at 856, is unconvincing. Stare decisis does not protect a constitutional decision where the reasoning is as poor as it is in Thames & Mersey, see Smith v. Allwright, 321 U. S. 649, 665 (1944), nor when the precedent, even if not yet proved unworkable, is at odds with more recent cases, see Fulton Corp. v. Faulkner, 516 U. S. 325, 345 - 346 (1996). It is, moreover, just a matter of time before Thames & Mersey proves itself unworkable; prior to today, it had not been given the chance to work its mischief on § 4371.
As we move to a more service-intensive and export-oriented economy, and as policymakers and experts debate
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