Chapter 96, § 16, Stats.Tennessee, 1881, enacting that
"All drummers and all persons not having a regular licensed
house of business in the Taxing District Shelby County offering for
sale or selling goods, wares, or merchandise therein by sample
shall be required to pay to the county trustee, the sum of $10 per
week or $25 per month for such privilege"
applies to persons soliciting the sale of goods on behalf of
individuals or firms doing business in another state, and so far as
it applies to them it is a regulation of commerce among the states,
and violates the provision of the Constitution of the United states
which grants to Congress the power to make such regulations.
Interstate commerce cannot be taxed at all by a state even
though the same amount of tax should be laid on domestic commerce
or that which is carried on solely within the state.
The power granted to Congress to regulate commerce among the
states being exclusive when the subjects are national in their
character or admit only of one uniform system of regulation, the
failure of Congress to exercise that power in any case is an
expression of its will that the subject shall be left free from
restrictions or impositions upon it by the several states.
A state may enact laws which in practice operate to affect
commerce among the status, as by providing in the legitimate
exercise of its police power and general jurisdiction for the
security and comfort of persons and the protection of property by
establishing and regulating channels for commercial facilities, by
the passage of inspection laws and laws to restrict the sale of
articles injurious to health and morals, by the imposition of taxes
upon avocations within its borders not interfering with foreign or
interstate commerce or employment or with business exercised
Page 120 U. S. 490
under authority of the Constitution of the United States, and in
other ways indicated in the opinion of the Court subject in all
cases to the limitations therein defined, but the statute of the
Tennessee considered in this opinion is not such a law.
This was an information in a state court of Tennessee against
the plaintiff in error for doing business in the Taxing District of
Shelby County in that state as a drummer on behalf of a firm doing
business in Cincinnati, Ohio, without a license as required by the
provision of the statute of Tennessee, which is set out in the
opinion of the Court. The defendant was found guilty, and this
judgment was affirmed by the supreme court of the state on appeal.
13 Lea 303. The defendant sued out this writ of error. The cause
was submitted at the last term of court. The court, on the 8th of
March, 1886, ordered it argued, and argument was heard accordingly
at this term. The case is stated in the opinion of the Court.
MR. JUSTICE BRADLEY delivered the opinion of the Court.
This case originated in the following manner:
Sabine Robbins, the plaintiff in error, in February, 1884, was
engaged at the City of Memphis, in the State of Tennessee, in
soliciting the sale of goods for the firm of Rose, Robbins &
Co., of Cincinnati, in the State of Ohio, dealers in paper and
other articles of stationery, and exhibited samples for the purpose
of effecting such sales -- an employment usually denominated as
that of a "drummer." There was in force at that time a statute of
Tennessee, relating to the subject of taxation in the taxing
districts of the state, applicable, however, only to the taxing
district of Shelby County (formerly the City of Memphis), by which
it was enacted, among other things, that
"All drummers, and all persons not having a regular licensed
house of business in the taxing district, offering for sale or
Page 120 U. S. 491
selling goods, wares, or merchandise therein, by sample, shall
be required to pay to the county trustee the sum of $10 per week,
or $25 per month, for such privilege, and no license shall be
issued for a longer period than three months."
Stats.Tennessee, 1881, c. 96, § 16.
The business of selling by sample and nearly sixty other
occupations, had been by law declared to be privileges, and were
taxed as such, and it was made a misdemeanor, punishable by a fine
of not less than five, nor more than fifty, dollars, to exercise
any of such occupations without having first paid the tax, or
obtained a license required therefor.
Under this law, Robbins, who had not paid the tax nor taken a
license, was prosecuted, convicted, and sentenced to pay a fine of
ten dollars, together with the state and county tax, and costs;
and, on appeal to the supreme court of the state, the judgment was
affirmed. This writ of error is brought to review the judgment of
the supreme court, on the ground that the law imposing the tax was
repugnant to that clause of the Constitution of the United States
which declares that Congress shall have power to regulate commerce
among the several states.
On the trial of the cause in the inferior court, a jury being
waived, the following agreed statement of facts was submitted to
the court, to-wit:
"Sabine Robbins is a citizen and resident of Cincinnati, Ohio,
and on the ___ day of _____, 1884, was engaged in the business of
drumming in the Taxing District of Shelby County, Tennessee,
i.e., soliciting trade, by the use of samples, for the
house or firm for which he worked as drummer, said firm being the
firm of 'Rose, Robbins & Co.,' doing business in Cincinnati,
and all the members of said firm being citizens and residents of
Cincinnati, Ohio. While engaged in the act of drumming for said
firm, and for the claimed offense of not having taken out the
required license for doing said business, the defendant, Sabine
Robbins, was arrested by one of the Memphis or taxing district
police force and carried before the Hon. D. P. Hadden, president of
the taxing district, and fined for the offense of drumming without
a license. It is
Page 120 U. S. 492
admitted the firm of 'Rose, Robbins & Co.' are engaged in
the selling of paper, writing materials, and such articles as are
used in the bookstores of the Taxing District of Shelby County, and
that it was a line of such articles for the sale of which the said
defendant herein was drumming at the time of his arrest."
This was all the evidence, and thereupon the court rendered
judgment against the defendant, to which he excepted, and a bill of
exceptions was taken.
The principal question argued before the Supreme Court of
Tennessee was as to the constitutionality of the act which imposed
the tax on drummers, and the court decided that it was
constitutional and valid.
That is the question before us, and it is one of great
importance to the people of the United States, both as respects
their business interests and their constitutional rights. It is
presented in a nutshell, and does not at this day, require for its
solution any great elaboration of argument or review of
authorities. Certain principles have been already established by
the decisions of this Court, which will conduct us to a
satisfactory decision. Among those principles are the
following:
1. The Constitution of the United States having given to
Congress the power to regulate commerce not only with foreign
nations, but among the several states, that power is necessarily
exclusive whenever the subjects of it are national in their
character, or admit only of one uniform system, or plan of
regulation. This was decided in the case of
Cooley v.
Board of Wardens of the Port of Philadelphia, 12
How. 299,
53 U. S. 319,
and was virtually involved in the case of
Gibbons v.
Ogden, 9 Wheat. 1, and has been confirmed in many
subsequent cases; among others, in
Brown v.
Maryland, 12 Wheat. 419;
Passenger
Cases, 7 How. 283;
Crandall v.
Nevada, 6 Wall. 35,
73 U. S. 42;
Ward v.
Maryland, 12 Wall. 418,
79 U. S. 430;
State Freight Tax
Cases, 15 Wall. 232,
82 U. S. 279;
Henderson v. Mayor of New York, 92 U. S.
259,
92 U. S. 272;
Railroad Co. v. Husen, 95 U. S. 465,
95 U. S. 469;
Mobile v. Kimball, 102 U. S. 691,
102 U. S. 697;
Gloucester Ferry Co. v. Pennsylvania, 114 U.
S. 196,
114 U. S. 203;
Wabash &c. Railway Co. v. Illinois, 118 U.
S. 557.
Page 120 U. S. 493
2. Another established doctrine of this Court is that, where the
power on Congress to regulate is exclusive, the failure of Congress
to make express regulations indicates its will that the subject
shall be left free from any restrictions or impositions, and any
regulation of the subject by the states, except in matters of local
concern only, as hereafter mentioned, is repugnant to such freedom.
This was held by Mr. Justice Johnson in
Gibbons v.
Ogden, 9 Wheat. 1,
22 U. S. 222; by
Mr. Justice Grier in the
Passenger
Cases, 7 How. 283,
48 U. S. 462,
and has been affirmed in subsequent cases.
State
Freight Tax Cases, 15 Wall. 232,
82 U. S. 279;
Railroad Co. v. Husen, 95 U. S. 465,
95 U. S. 469;
Welton v. Missouri, 91 U. S. 275,
91 U. S. 282;
County of Mobile v. Kimball, 102 U.
S. 691,
102 U. S. 697;
Brown v. Houston, 114 U. S. 622,
114 U. S. 631;
Walling v. Michigan, 116 U. S. 446,
116 U. S. 455;
Pickard v. Pullman Southern Car Co., 117 U. S.
34;
Wabash &c. Railway Co. v. Illinois,
118 U. S. 557.
3. It is also an established principle, as already indicated,
that the only way in which commerce between the states can be
legitimately affected by state laws is when, by virtue of its
police power and its jurisdiction over persons and property within
its limits, a state provides for the security of the lives, limbs,
health, and comfort of persons and the protection of property, or
when it does those things which may otherwise incidentally affect
commerce, such as the establishment and regulation of highways,
canals, railroads, wharves, ferries, and other commercial
facilities; the passage of inspection laws to secure the due
quality and measure of products and commodities; the passage of
laws to regulate or restrict the sale of articles deemed injurious
to the health or morals of the community; the imposition of taxes
upon persons residing within the state or belonging to its
population, and upon avocations and employments pursued therein,
not directly connected with foreign or interstate commerce, or with
some other employment or business exercised under authority of the
Constitution and laws of the United States, and the imposition of
taxes upon all property within the state, mingled with and forming
part of the great mass of property therein. But in making such
internal regulations, a state cannot impose taxes upon persons
Page 120 U. S. 494
passing through the state, or coming into it merely for a
temporary purpose, especially if connected with interstate or
foreign commerce; nor can it impose such taxes upon property
imported into the state from abroad, or from another state, and not
yet become part of the common mass of property therein, and no
discrimination can be made by any such regulations adversely to the
persons or property of other states, and no regulations can be made
directly affecting interstate commerce. Any taxation or regulation
of the latter character would be an unauthorized interference with
the power give to Congress over the subject.
For authorities on this last head it is only necessary to refer
to those already cited.
In a word, it may be said that in the matter of interstate
commerce, the United States are but one country, and are and must
be subject to one system of regulations, and not to a multitude of
systems. The doctrine of the freedom of that commerce, except as
regulated by Congress, is so firmly established that it is
unnecessary to enlarge further upon the subject.
In view of these fundamental principles, which are to govern our
decision, we may approach the question submitted to us in the
present case, and inquire whether it is competent for a state to
levy a tax or impose any other restriction upon the citizens or
inhabitants of other states for selling or seeking to sell their
goods in such state before they are introduced therein. Do not such
restrictions affect the very foundation of interstate trade? How is
a manufacturer or a merchant of one state to sell his goods in
another state, without in some way obtaining orders therefor? Must
he be compelled to send them at a venture without knowing whether
there is any demand for them? This may undoubtedly be safely done
with regard to some products for which there is always a market and
a demand, or where the course of trade has established a general
and unlimited demand. A raiser of farm produce in New Jersey or
Connecticut, or a manufacturer of leather or woodenware, may
perhaps safely take his goods to the City of New York and be sure
of finding a stable and reliable market for them. But there are
hundreds, perhaps thousands, of
Page 120 U. S. 495
articles which no person would think of exporting to another
state without first procuring an order for them. It is true, a
merchant or manufacturer in one state may erect or hire a warehouse
or store in another state in which to place his goods and await the
chances of being able to sell them, but this would require a
warehouse or store in every state with which he might desire to
trade. Surely he cannot be compelled to take this inconvenient and
expensive course. In certain branches of business it may be adopted
with advantage. Many manufacturers do open houses or places of
business in other states than those in which they reside, and send
their goods there to be kept on sale; but this is a matter of
convenience, and not of compulsion, and would neither suit the
convenience nor be within the ability of many others engaged in the
same kinds of business, and would be entirely unsuited to many
branches of business. In these cases, then, what shall the merchant
or manufacturer do who wishes to sell his goods in other states?
Must he sit still in his factory or warehouse and wait for the
people of those states to come to him? This would be a silly and
ruinous proceeding.
The only other way, and the one perhaps which most extensively
prevails, is to obtain orders from persons residing or doing
business in those other states. But how is the merchant or
manufacturer to secure such orders? If he may be taxed by such
states for doing so, who shall limit the tax? It may amount to
prohibition. To say that such a tax is not a burden upon interstate
commerce is to speak at least unadvisedly and without due attention
to the truth of things.
It may be suggested that the merchant or manufacturer has the
post office at his command, and may solicit orders through the
mails. We do not suppose, however, that anyone would seriously
contend that this is the only way in which his business can be
transacted without being amenable to exactions on the part of the
state. Besides, why could not the state to which his letters might
be sent tax him for soliciting orders in this way as well as in any
other way?
The truth is that in numberless instances, the most feasible, if
not the only practicable, way for the merchant or manufacturer
Page 120 U. S. 496
to obtain orders in other states is to obtain them by personal
application, either by himself or by some one employed by him for
that purpose, and in many branches of business he must necessarily
exhibit samples for the purpose of determining the kind and quality
of the goods he proposes to sell, or which the other party desires
to purchase. But the right of taxation, if it exists at all, is not
confined to selling by sample. It embraces every act of sale,
whether by word of mouth only, or by the exhibition of samples. If
the right exists, any New York or Chicago merchant visiting New
Orleans or Jacksonville for pleasure or for his health and casually
taking an order for goods to be sent from his warehouse, could be
made liable to pay a tax for so doing, or be convicted of a
misdemeanor for not having taken out a license. The right to tax
would apply equally as well to the principal as to his agent, and
to a single act of sale as to a hundred acts.
But it will be said that a denial of this power of taxation will
interfere with the right of the state to tax business pursuits and
callings carried on within its limits and its right to require
licenses for carrying on those which are declared to be privileges.
This may be true to a certain extent, but only in those cases in
which the states themselves, as well as individual citizens, are
subject to the restraints of the higher law of the Constitution,
and this interference will be very limited in its operation. It
will only prevent the levy of a tax, or the requirements of a
license, for making negotiations in the conduct of interstate
commerce, and it may well be asked where the state gets authority
for imposing burdens on that branch of business any more than for
imposing a tax on the business of importing from foreign countries,
or even on that of postmaster or United States marshal. The mere
calling the business of a drummer a privilege cannot make it so.
Can the state legislature make it a Tennessee privilege to carry on
the business of importing goods from foreign countries? If not, has
it any better right to make it a state privilege to carry on
interstate commerce? It seems to be forgotten in argument that the
people of this country are citizens of the United States as well as
of the individual states, and that they have some rights
Page 120 U. S. 497
under the Constitution and laws of the former independent of the
latter, and free from any interference or restraint from them.
To deny to the state the power to lay the tax or require the
license in question will not in any perceptible degree diminish its
resources or its just power of taxation. It is very true that if
the goods when sold were in the state and part of its general mass
of property, they would be liable to taxation; but when brought
into the state in consequence of the sale, they will be equally
liable, so that in the end the state will derive just as much
revenue from them as if they were there before the sale. As soon as
the goods are in the state and become part of its general mass of
property, they will become liable to be taxed in the same manner as
other property of similar character, as was distinctly held by this
Court in the case of
Brown v. Houston, 114 U.
S. 622. When goods are sent from one state to another
for sale or in consequence of a sale, they become part of its
general property and amenable to its laws, provided that no
discrimination be made against them as goods from another state and
that they be not taxed by reason of being brought from another
state, but only taxed in the usual way, as other goods are.
Brown v. Houston, qua supra; Machine Co. v. Gage,
100 U. S. 676. But
to tax the sale of such goods, or the offer to sell them, before
they are brought into the state is a very different thing, and
seems to us clearly a tax on interstate commerce itself.
It is strongly urged, as if it were a material point in the
case, that no discrimination is made between domestic and foreign
drummers -- those of Tennessee and those of other states; that all
are taxed alike. But that does not meet the difficulty. Interstate
commerce cannot be taxed at all, even though the same amount of tax
should be laid on domestic commerce or that which is carried on
solely within the state. This was decided in the case of
State Freight Tax
Cases, 15 Wall. 232. The negotiation of sales of
goods which are in another state, for the purpose of introducing
them into the state in which the negotiation is made, is interstate
commerce.
Page 120 U. S. 498
A New Orleans merchant cannot be taxed there for ordering goods
from London or New York, because, in the one case, it is an act of
foreign, and, in the other, of interstate, commerce, both of which
are subject to regulation by Congress alone.
It would not be difficult, however, to show that the tax
authorized by the State of Tennessee in the present case is
discriminative against the merchants and manufacturers of other
states. They can only sell their goods in Memphis by the employment
of drummers and by means of samples; while the merchants and
manufacturers of Memphis, having regular licensed houses of
business there, have no occasion for such agents, and, if they had,
they are not subject to any tax therefor. They are taxed for their
licensed houses, it is true; but so, it is presumable, are the
merchants and manufacturers of other states in the places where
they reside, and the tax on drummers operates greatly to their
disadvantage in comparison with the merchants and manufacturers of
Memphis. And such was undoubtedly one of its objects. This kind of
taxation is usually imposed at the instance and solicitation of
domestic dealers as a means of protecting them from foreign
competition, and in many cases there may be some reason in their
desire for such protection. But this shows in a still stronger
light the unconstitutionality of the tax. It shows that it not only
operates as a restriction upon interstate commerce, but that it is
intended to have that effect as one of its principal objects. And
if a state can, in this way, impose restrictions upon interstate
commerce for the benefit and protection of its own citizens, we are
brought back to the condition of things which existed before the
adoption of the Constitution, and which was one of the principal
causes that led to it.
If the selling of goods by sample, and the employment of
drummers for that purpose, injuriously affect the local interest of
the states, Congress, if applied to, will undoubtedly make such
reasonable regulations as the case may demand. And Congress alone
can do it, for it is obvious that such regulations should be based
on a uniform system applicable to the whole country, and not left
to the varied, discordant, or retaliatory enactments of forty
different states. The confusion into which
Page 120 U. S. 499
the commerce of the country would be thrown by being subject to
state legislation on this subject would be but a repetition of the
disorder which prevailed under the Articles of Confederation.
To say that the tax, if invalid as against drummers from other
states, operates as a discrimination against the drummers of
Tennessee, against whom it is conceded to be valid, is no argument,
because the state is not bound to tax its own drummers, and if it
does so, while having no power to tax those of other states, it
acts of its own free will, and is itself the author of such
discriminations. As before said, the state may tax its own internal
commerce; but that does not give it any right to tax interstate
commerce.
The judgment of the Supreme Court of Tennessee is reversed,
and the plaintiff in error must be discharged.
MR. CHIEF JUSTICE WAITE, with whom concurred MR. JUSTICE FIELD
and MR. JUSTICE GRAY, dissenting.
I am unable to agree to this judgment. The case, as I understand
it, is this:
In January, 1879, the State of Tennessee abolished the charter
of the City of Memphis, and created the Taxing District of Shelby
County as its successor. By a statute passed April 4, 1881, to
provide means for the support of the taxing district, it was, among
other things, enacted
"That all drummers, and all persons not having a licensed house
of business in the taxing district, offering for sale or selling
goods, wares, or merchandise therein by sample, shall be required
to pay to the county trustees the sum of $10 per week, or $25 per
month, for such privilege, and no license shall be issued for a
longer period than three months."
Sabine Robbins, a citizen of Ohio, employed by the firm of Rose,
Robbins & Co., also citizens of Ohio, engaged in business as
merchants at the City of Cincinnati in that state, has been
convicted of a violation of this statute, because he solicited
trade for his firm in the taxing district, by the use of samples,
without a license. This it is now decided was wrong, because
Page 120 U. S. 500
the statute under which the conviction was had, insofar as it
applies to the business in which Robbins was engaged, is a
regulation of interstate commerce, and therefore repugnant to the
Commerce Clause of the Constitution of the United States. To this I
cannot give my assent.
The license fees are demanded for the privilege of selling goods
by sample within the taxing district. The fee is exacted from all
alike who do that kind of business, unless they have "a licensed
house of business" in the district. There is no discrimination
between citizens of the state and citizens of other states. The tax
is upon the business, and this I have always understood to be
lawful, whether the business was carried on by a citizen of the
state under whose authority the exaction was made, or a citizen of
another state, unless there was discrimination against citizens of
other states. In
Osborne v.
Mobile, 16 Wall. 481, it is said
"The whole court agreed that a tax on business carried on within
the state, and without discrimination between its citizens and the
citizens of other states, might be constitutionally imposed and
collected."
And I cannot believe that if Robbins had opened an office for
his business within the taxing district at which he kept and
exhibited his samples, it would be held that he would not be liable
to the tax, and this whether he stayed there all the time or came
only at intervals. But what can be the difference in principle, so
far as this question is concerned, whether he takes a room
permanently in a business block of the district where, when he
comes, he sends his boxes and exhibits his wares, or engages a room
temporarily at a hotel or private house, and carries on his
business there during the stay? Or even whether he takes his sample
boxes around with him to his different customers, and shows his
wares from them? In either case, he goes to the district to ply his
trade, and make his sales from the goods he exhibits. He does not
sell those goods, but he sells others like them. It is true that
his business was to solicit orders for his principals; but, in
doing so, he bargained for them, carried on business for them, in
the district by means of the samples of their goods which had been
furnished him for that purpose. To all intents and purposes, he had
his goods with him for sale,
Page 120 U. S. 501
for what he sold was like what he exhibited as the subjects of
sale. I am unable to see any difference in principle between a tax
on a seller by sample and a tax on a peddler, and yet I can hardly
believe it would be contended that the provision of the same
statute now in question, which fixes a license fee for all peddlers
in the district, would be held to be unconstitutional in its
application to peddlers who came with their goods from another
state, and expected to go back again.
As the law is valid so far as the inhabitants of the state are
concerned, no inhabitant can engage in this business unless he pays
the tax. If citizens of other states cannot be taxed in the same
way for the same business, there will be discrimination against the
inhabitants of Tennessee and in favor of those of other states.
This could never have been intended by the legislature, and I
cannot believe the Constitution of the United States makes such a
thing necessary. The Constitution gives the citizens of each state
all the privileges and immunities of citizens in the several
states, but this certainly does not guarantee to those who are
doing business in states other than their own, immunities from
taxation on that business to which citizens of the state where the
business is carried on are subjected.
This case shows the need of such authority in the states. This
taxing district is situated on the western boundary of Tennessee.
To get into another state, it is only necessary to cross the
Mississippi River to Arkansas. It may be said to be an historical
fact that the charter of Memphis was abolished, and the taxing
district established, because of the oppressive debt of Memphis,
and the records of this Court furnish abundant evidence of the
heavy taxation to which property and business within the limits of
both the old corporation and the new have been for many years
necessarily subjected. Merchants in Tennessee are by law required
to pay taxes on the amount of their stock on hand and a privilege
tax besides. Under these circumstances, it is easy to see that if a
merchant from another state could carry on a business in the
district by sending his agents there with samples of his goods to
secure orders for deliveries from his stock at home, he would enjoy
a
Page 120 U. S. 502
privilege of exemption from taxation which the local merchant
would not have unless in some form he could be subjected to
taxation for what he did in the locality. The same would be true in
respect to all inhabitants of the state who were sellers by sample
in this district, but who had no place of business there. And so
they, like citizens of other states, were required to pay for the
privilege. Thus, all were treated alike, whether they were citizens
of Tennessee or of some other state, and under these circumstances
I can see no constitutional objection to such a taxation of
citizens of the other states for their business in the
district.
I have treated the case as a conviction of a "drummer" for
selling goods by sample. That is what Robbins was found guilty of,
and that is what this statute makes an offense. The license is only
required of
"drummers and all persons not having a licensed house of
business in the taxing district, offering for sale or selling
goods, wares, or merchandise therein by sample."
The Supreme Court of Tennessee decided that this means nothing
more than that any person who sells by sample shall pay the tax,
and to that I agree. It will be time enough to consider whether a
nonresident can be taxed for merely soliciting orders without
having samples when such a case arises. That is not this case.
MR. JUSTICE FIELD and MR. JUSTICE GRAY concur in this
dissent.