Department of Revenue of Kentucky v. Davis, 553 U.S. 328 (2008), is a United States Supreme Court case in which the Court upheld a Kentucky law that provides a preferential tax break to Kentucky residents who invest in bonds issued by the state and its municipalities (municipal bonds). The Court held in a 7–2 vote that the State of Kentucky does not engage in unconstitutional discrimination against interstate commerce by exempting the interest on its bonds from residents' taxable income while taxing the interest earned on the bonds of other states.[1] The case has national implications because thirty-six (36) states have tax schemes similar to the one at issue in Kentucky.[2]
George and Catherine Davis sued the State of Kentucky under the legal theory that the State of Kentucky violated the Dormant Commerce Clause, a legal implication of the Commerce Clause, by providing a differential tax treatment to gains earned from investments in municipal bonds from Kentucky versus other states.[3]
Opinion of the Courtedit
The majority opinion stated that the Kentucky tax scheme benefited a clearly public issuer, while treating all private issuers exactly the same. There was no forbidden discrimination because Kentucky, as a public entity, did not have to treat itself as being "substantially similar" to the other bond issuers in the market. The Kentucky tax scheme was constitutional because the Commonwealth's direct participation favored, not local private entrepreneurs, but the Commonwealth and local governments.
Footnotesedit
^Greenhouse, Linda (May 20, 2008). "Court Upholds Tax Exemptions for Municipal Bonds". New York Times. Retrieved May 20, 2008.
^Department of Revenue of Kentucky v. Davis 553 U.S. ____, pg 5.
^Department of Revenue of Kentucky v. Davis 553 U.S. ____, pg 6.
External linksedit
Text of Department of Revenue of Kentucky v. Davis, 553U.S. 328 (2008) is available from:Google ScholarJustiaOyez (oral argument audio)
January 01, 1970
department, revenue, kentucky, davis, 2008, united, states, supreme, court, case, which, court, upheld, kentucky, that, provides, preferential, break, kentucky, residents, invest, bonds, issued, state, municipalities, municipal, bonds, court, held, vote, that,. Department of Revenue of Kentucky v Davis 553 U S 328 2008 is a United States Supreme Court case in which the Court upheld a Kentucky law that provides a preferential tax break to Kentucky residents who invest in bonds issued by the state and its municipalities municipal bonds The Court held in a 7 2 vote that the State of Kentucky does not engage in unconstitutional discrimination against interstate commerce by exempting the interest on its bonds from residents taxable income while taxing the interest earned on the bonds of other states 1 The case has national implications because thirty six 36 states have tax schemes similar to the one at issue in Kentucky 2 Department of Revenue of Kentucky v DavisSupreme Court of the United StatesArgued November 5 2007Decided May 19 2008Full case nameDepartment of Revenue of Kentucky et al v George W Davis et ux Docket no 06 666Citations553 U S 328 more 128 S Ct 1801 170 L Ed 2d 685 2008 U S LEXIS 4312 76 U S L W 4288 21 Fla L Weekly Fed S 227Case historyPriorOn Writ of Certiorari to the Court of Appeals of Kentucky Court membershipChief Justice John Roberts Associate Justices John P Stevens Antonin ScaliaAnthony Kennedy David SouterClarence Thomas Ruth Bader GinsburgStephen Breyer Samuel AlitoCase opinionsPluralitySouter joined by Stevens Breyer Roberts Ginsburg all but Part III B Scalia all but Parts III B and IV ConcurrenceStevensConcurrenceRoberts in part ConcurrenceScalia in part ConcurrenceThomas in judgment DissentKennedy joined by AlitoDissentAlito Contents 1 Background 2 Opinion of the Court 3 Footnotes 4 External linksBackground editGeorge and Catherine Davis sued the State of Kentucky under the legal theory that the State of Kentucky violated the Dormant Commerce Clause a legal implication of the Commerce Clause by providing a differential tax treatment to gains earned from investments in municipal bonds from Kentucky versus other states 3 Opinion of the Court editThe majority opinion stated that the Kentucky tax scheme benefited a clearly public issuer while treating all private issuers exactly the same There was no forbidden discrimination because Kentucky as a public entity did not have to treat itself as being substantially similar to the other bond issuers in the market The Kentucky tax scheme was constitutional because the Commonwealth s direct participation favored not local private entrepreneurs but the Commonwealth and local governments Footnotes edit Greenhouse Linda May 20 2008 Court Upholds Tax Exemptions for Municipal Bonds New York Times Retrieved May 20 2008 Department of Revenue of Kentucky v Davis 553 U S pg 5 Department of Revenue of Kentucky v Davis 553 U S pg 6 External links editText of Department of Revenue of Kentucky v Davis 553 U S 328 2008 is available from Google Scholar Justia Oyez oral argument audio Supreme Court slip opinion archived Retrieved from https en wikipedia org w index php title Department of Revenue of Kentucky v Davis amp oldid 1193895051, wikipedia, wiki, book, books, library,
