Cite as: 520 U. S. 564 (1997)
Opinion of the Court
from its home State, and was therefore "the potential beneficiary of a scheme no less discriminatory than the one that it attacks, and no less effective in conferring a commercial advantage over out-of-state competitors." Id., at 278. That was of no importance. We noted: "The Commerce Clause does not prohibit all state action designed to give its residents an advantage in the marketplace, but only action of that description in connection with the State's regulation of interstate commerce. Direct subsidization of domestic industry does not ordinarily run afoul of that prohibition; discriminatory taxation . . . does." Ibid. (emphasis in original). See also West Lynn, 512 U. S., at 210 (Scalia, J., concurring in judgment) (drawing similar distinction between forbidden generally applicable tax with discriminatory "exemption" and permissible "subsidy . . . funded from the State's general revenues"). This distinction is supported by scholarly commentary as well as precedent, and we see no reason to depart from it. See Enrich, Saving the States from Themselves: Commerce Clause Constraints on State Tax Incentives for Business, 110 Harv. L. Rev. 377, 442-443 (1996); Hellerstein & Coenen, Commerce Clause Restraints on State Business Development Incentives, 81 Cornell L. Rev. 789, 846-848 (1996).26 The Town's claim that its discriminatory tax scheme should be viewed as a permissible subsidy is therefore unpersuasive.27
26 The distinction provides a sufficient response to the Town's argument that our ruling today would invalidate a State's subsidization of all or part of its residents' tuition at state-owned universities.
27 Justice Scalia, post, at 605-606, and n. 4, would distinguish this line of authority by holding that it should not apply where a State is giving tax relief to charitable enterprises. As explained in Part V, supra, we see no categorical reason to treat for-profit and nonprofit entities differently under the dormant Commerce Clause. Justice Scalia's heavy reliance upon Board of Ed. of Ky. Annual Conference of Methodist Episcopal Church v. Illinois, 203 U. S. 553 (1906), is misplaced. In that case, a bequest to a Kentucky charitable corporation did not qualify for an exemp-
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