Under the New Jersey Transportation Benefits Tax Act, New Jersey
does not tax its residents' domestic income, but does tax
nonresidents' New Jersey-derived income and imposes an equivalent
tax on residents' income earned outside the State except that such
income is exempted to the extent it is taxed by the State in which
it is earned. The New Hampshire Commuters Tax was held
unconstitutional in
Austin v. New Hampshire, 420 U.
S. 656, in violation of the Privilege and Immunities
Clause because it fell exclusively on nonresidents' income and was
not offset by other taxes imposed on residents alone. Pennsylvania,
suing on behalf of itself and as
parens patriae on behalf
of its citizens, moved to file an original bill of complaint
against New Jersey, contending that the New Jersey tax Act violates
the Privileges and Immunities Clause as interpreted in
Austin,
supra, and also the Equal Protection Clause of the Fourteenth
Amendment, and seeking declaratory and injunctive relief and an
accounting for taxes diverted from its treasury by the New Jersey
tax. Maine, Massachusetts, and Vermont on behalf of themselves,
moved, in reliance on
Austin, supra, to file an original
bill of complaint against New Hampshire seeking an accounting for
the taxes diverted from their respective treasuries by the New
Hampshire Commuters Income Tax. Pennsylvania, Maine, Massachusetts,
and Vermont all extend a tax credit to their residents for income
taxes paid to other States.
Held:
1. The motions for leave to file bills of complaint based on
claims brought by the plaintiff States on their own behalf are
denied. In neither suit has the defendant State directly injured
the plaintiff States by imposing the taxes in question, but the
injuries to the plaintiffs' fiscs were self-inflicted, resulting
from decisions by their respective state legislatures to allow
their residents credit for taxes paid to other States. Moreover,
the Privileges and Immunities and Equal Protection Clauses protect
people, not States.
Page 426 U. S. 661
2. Pennsylvania's motion for leave to file suit as
parens
patriae on behalf of its citizens is also denied, since such a
suit represents nothing more than a collectivity of private suits
against New Jersey for taxes withheld from private parties, and no
sovereign or
quasi-sovereign interests of Pennsylvania are
implicated.
PER CURIAM.
The motions for leave to file bills of complaint in these cases
are denied.
The complaints, which seek to invoke our original jurisdiction,
filed by Pennsylvania against New Jersey, and by Maine,
Massachusetts, and Vermont against New Hampshire, rely on our
decision last Term in
Austin
Page 426 U. S. 662
v. New Hampshire, 420 U. S. 656
(1975), in which we held the New Hampshire Commuters Income Tax
unconstitutional.
In
Austin, supra, the Court held that the New Hampshire
tax violated the Privileges and Immunities Clause of the
Constitution. That law imposed a 4% tax on the New
Hampshire-derived income of nonresidents. Although the law also
imposed a tax on the income earned by New Hampshire residents
outside the State, it then exempted such income from the tax if the
income were either taxed or not taxed by the State from which it
was derived. Since New Hampshire also did not tax the domestic
income of its residents, the net effect of the Commuters Income Tax
was to tax only the incomes of nonresidents working in New
Hampshire.
The resident State of the plaintiff in
Austin was
Maine, and it provided a credit for income taxes paid to other
States. Thus, New Hampshire's beggar-thy-neighbor tax rendered the
total state tax liability of nonresidents unchanged, but diverted
to New Hampshire tax revenues from the treasury of Maine. We held
New Hampshire's taxing scheme unconstitutional, since the tax
"[fell] exclusively on the income of nonresidents . . . , and [was]
not offset even approximately by other taxes imposed upon residents
alone."
Id. at
420 U. S. 665
(footnote deleted).
In No. 68, Original, Pennsylvania contends that the New Jersey
Transportation Benefits Tax Act, N.J.Stat.Ann. § 54:8A-58
et
seq. (Supp. 1976-1977), is infirm under the Privileges and
Immunities Clause as interpreted in
Austin, supra, and the
Equal Protection Clause of the Fourteenth Amendment. According to
the complaint filed by Pennsylvania, the New Jersey tax fatally
resembles the tax we held unconstitutional in
Austin. Like
New Hampshire, New Jersey does not tax the domestic income of its
residents. Under the Transportation
Page 426 U. S. 663
Benefits Tax Act, however, New Jersey does tax the New
Jersey-derived income of nonresidents. And while that Act imposes
an equivalent tax on. the income of New Jersey residents earned
outside the State, it exempts such income to the extent it is taxed
by the State in which it is earned. Finally, like Maine in the
Austin case, Pennsylvania permits a tax credit to any of
its residents for income taxes paid to other States, including, of
course, New Jersey. Pennsylvania, suing on behalf of itself and as
parens patriae on behalf of its citizens, seeks
declaratory and injunctive relief and, apparently, an accounting
for the taxes that New Jersey's allegedly unconstitutional tax has
diverted from the Pennsylvania treasury.
The plaintiffs in No. 69, Original, Maine, Massachusetts, and
Vermont, explicitly premise their suit on the decision in
Austin, supra. They seek on behalf of themselves an
accounting for the taxes, alleged to amount to over $13.5 million,
that New Hampshire's unconstitutional Commuters Income Tax diverted
from their respective treasuries.
It has long been the rule that, in order to engage this Court's
original jurisdiction, a plaintiff State must first demonstrate
that the injury for which it seeks redress was directly caused by
the actions of another State. As Mr. Chief Justice Hughes noted on
behalf of the Court in
Massachusetts v. Missouri,
308 U. S. 1,
308 U. S. 15
(1939):
"To constitute such a [justiciable] controversy, it must appear
that the complaining State has suffered a wrong through the action
of the other State, furnishing ground for judicial redress. . .
."
In
Massachusetts v. Missouri, supra, Massachusetts
sought a declaration that only it could impose an inheritance tax
on the estate of a Massachusetts domiciliary who had died with most
of his assets located in
Page 426 U. S. 664
several revocable Missouri trusts. The assets located in
Massachusetts were insufficient to pay that State's inheritance
taxes. Missouri also claimed the exclusive right to impose its tax
on the Missouri trusts. In language that is particularly
appropriate for our disposition of these cases, the Court denied
leave to file the complaint:
"Missouri, in claiming a right to recover taxes from the . . .
trustees, or in taking proceedings for collection, is not injuring
Massachusetts. By the allegations, the property held in Missouri is
amply sufficient to answer the claims of both States, and recovery
by either does not impair the exercise of any right the other may
have. It is not shown that there is danger of the depletion of a
fund or estate at the expense of the complainant's interest. It is
not shown that the tax claims of the two States are mutually
exclusive. On the contrary, the validity of each claim is wholly
independent of that of the other. . . ."
Ibid.
In neither of the suits at bar has the defendant State inflicted
any injury upon the plaintiff States through the imposition of the
taxes held, in No. 69, and alleged, in No. 68, to be
unconstitutional. The injuries to the plaintiffs' fiscs were
self-inflicted, resulting from decisions by their respective state
legislatures. Nothing required Maine, Massachusetts, and Vermont to
extend a tax credit to their residents for income taxes paid to New
Hampshire, and nothing prevents Pennsylvania from withdrawing that
credit for taxes paid to New Jersey. No State can be heard to
complain about damage inflicted by its own hand.
Pennsylvania, in attempting to establish its entitlement to
taxes collected by New Jersey from its residents, has alleged that
the New Jersey Transportation Benefit
Page 426 U. S. 665
Tax Act violates both the Privileges and Immunities Clause and
the Equal Protection Clause. Maine, Massachusetts, and Vermont
claim that New Hampshire's withholding of taxes collected under its
unconstitutional commuters tax violates the Privileges and
Immunities Clause. The short answer to these contentions is that
both Clauses protect people, not States.
What has been said disposes of the claims brought by the
plaintiff States on their own behalf. In addition, however,
Pennsylvania has filed a claim against New Jersey as
parens
patriae on behalf of its citizens.
The Court has recognized the legitimacy of
parens
patriae suits.
See Hawaii v. Standard Oil Co.,
405 U. S. 251,
405 U. S.
257-260 (1972);
Louisiana v. Texas,
176 U. S. 1,
176 U. S. 19
(1900). It has, however, become settled doctrine that a State has
standing to sue only when its sovereign or
quasi-sovereign
interests are implicated and it is not merely litigating as a
volunteer the personal claims of its citizens.
Compare, e.g.,
Oklahoma ex rel. Johnson v. Cook, 304 U.
S. 387 (1938);
Oklahoma v. Atchison, T. & S. F.
R. Co., 220 U. S. 277
(1911);
Kansas v. United States, 204 U.
S. 331 (1907) (States may not invoke original
jurisdiction of Supreme Court to prosecute purely personal claims
of their citizens),
with, e.g., North Dakota v. Minnesota,
263 U. S. 365
(1923);
Pennsylvania v. West Virginia, 262 U.
S. 553 (1923);
New York v. New Jersey,
256 U. S. 296
(1921);
Georgia v. Tennessee Copper Co., 206 U.
S. 230 (1907);
Kansas v. Colorado, 206 U. S.
46 (1907) (original jurisdiction sustained for States
protecting
quasi-sovereign interests).
This rule is a salutary one. For if, by the simple expedient of
bringing an action in the name of a State, this Court's original
jurisdiction could be invoked to resolve what are, after all, suits
to redress private grievances, our docket would be inundated. And,
more important, the critical distinction, articulated in Art. III,
§ 2, of
Page 426 U. S. 666
the Constitution, between suits brought by "Citizens" and those
brought by "States" would evaporate.
Pennsylvania's
parens patriae suit against New Jersey
represents nothing more than a collectivity of private suits
against New Jersey for taxes withheld from private parties. No
sovereign or
quasi-sovereign interests of Pennsylvania are
implicated. Accordingly, Pennsylvania's motion for leave to file
suit as
parens patriae on behalf of its citizens is also
denied.
MR. JUSTICE BRENNAN and MR. JUSTICE WHITE dissent and would
grant leave to file both bills of complaint.
MR. JUSTICE POWELL and MR; JUSTICE STEVENS took no part in the
consideration or decision of these cases.
* Together with No. 69, Orig.,
Maine et al. v. New
Hampshire, also on motion for leave to file bill of
complaint.
MR. JUSTICE BLACKMUN, concurring.
Obviously, and naturally, I join the Court's per curiam opinion.
Last Term, in lonely dissent, in the case which has spawned the
present motions by Pennsylvania and by Maine, Massachusetts, and
Vermont, I said:
"Because the New Hampshire income tax statutes operate in such a
way that no New Hampshire resident is ultimately subjected to the
State's income tax, the case, at first glance, appears to have some
attraction. That attraction, however, is superficial, and, upon
careful analysis, promptly fades and disappears entirely. The
reason these appellants, who are residents of Maine, not of New
Hampshire, pay a New Hampshire tax is because the Maine Legislature
-- the appellants' own duly elected representatives -- has given
New Hampshire the option to divert this increment of tax (on a
Maine resident's income earned in New Hampshire) from Maine to New
Hampshire, and New Hampshire willingly has picked up that option.
All that New Hampshire
Page 426 U. S. 667
has done is what Maine specifically permits and, indeed, invites
it to do. If Maine should become disenchanted with its bestowed
bounty, its legislature may change the Maine statute. The crux is
the statute of Maine, not the statute of New Hampshire. The
appellants, therefore, are really complaining about their own
statute. It is ironic that the State of Maine, which allows the
credit, has made an appearance in this case as an
amicus
urging, in effect, the denial of the credit by an adjudication of
unconstitutionality of New Hampshire's statute. It seems to me that
Maine should be here seeking to uphold its own legislatively
devised plan or turn its attention to its own legislature."
Austin v. New Hampshire, 420 U.
S. 656,
420 U. S.
668-669 (1975).
The Court, in its per curiam,
ante at
426 U. S. 664,
now concedes that the "injuries to the plaintiffs' fiscs were
self-inflicted," and that no State "can be heard to complain about
damages inflicted by its own hand."
Quod approbo non
reprobo.