Aldens, Inc. v. Tully

Mahoney, P. J., and Sweeney, J.,

dissent and vote to annul in the following memorandum by Mahoney, P. J. Mahoney, P. J. (dissenting). The oft-enunciated rule for imposition of local burdens on foreign corporations engaging in interstate commerce is that there must be some minimum connection between the State and that which it seeks to tax (National Geographic v California Equalization Bd., 430 US 551; National Bellas Hess v Department of Revenue, 386 US 753, 756; Miller Bros. Co. v Maryland, 347 US 340, 344-345). The mere solicitation of sales by a foreign corporation, absent a permanent sales office or sales force within the taxing State, does not justify the imposition of a duty to collect State sales and use taxes (compare National Bellas Hess v Department of Revenue, supra; Miller Bros. Co. v Maryland, supra, with National Geographic v California Equalization Bd., supra; Scripto v Carson, 362 US 207). The same rule should apply to sales and use taxes imposed by local governments (see National Steel Corp. v City of New York, 1 Misc 2d 1012, affd 283 App Div 867, mot to dism app den 307 NY 837, mot to delay oral argument granted 308 NY 745; cf. Society of Plastics Ind. v City of New York, 68 Misc 2d 366, 385). To do otherwise would tend to "balkanize the American economy” by exposing foreign corporations to an array of varying local tax rates without a corresponding nexus to the taxing localities (see National Bellas Hess v Department of Revenue, supra, pp 759-760; cf. Matter of Gillette Co. v State Tax Comm. 56 AD2d 475, 482, affd 45 NY2d 846). Therefore, petitioner *724should not be responsible for collection of local sales and use taxes in counties whre it does not have an office or sales force. Accordingly, the determination should be annulled.