Petition for Writ of Mandamus - Filed - Supreme Court of Texas

or activities within the taxing state and to the taxpayer’s consequent enjoyment of the
opportunities that the state has afforded. Rylander v. 3 Beall Bros. 3, Inc., 2 S.W.3d 562,
571 (Tex. App.—Austin 1999, pet. denied) (citing Commonwealth Edison Co. v.
Montana, 453 U.S. 609, 629 (1981)).
The Margin Tax imposes a tax rate that is often dependent on a taxpayer’s
activities outside of Texas. For example, Nestle is subject to a tax rate of 1.0% rather
than 0.5% based solely on the fact that it manufactures in other states. The Margin Tax
discriminates against interstate commerce by subjecting entities to a higher tax rate based
solely on the fact that they conduct certain activities in interstate activities. The Margin
Tax also is not fairly related to the services provided by Texas because it imposes
different tax rates on similarly-situated wholesalers based on their operations in other
states, which operations have no relation to the services provided by Texas. Because it
discriminates against interstate commerce and does not fairly relate to the services
provided by Texas, the Margin Tax violates the Commerce Clause of the United States
Constitution.
PRAYER
Relator respectfully requests that, within 120 days of the filing of this Petition, this
Court (1) mandamus the Comptroller to refund $8,682,998.99 of franchise tax paid by
Relator under protest; (2) declare that the Margin Tax violates the Texas Constitution and
the United States Constitution; (3) permanently enjoin the Comptroller against
enforcement, collection, or assessment of the Margin Tax against Relator; and (4) award
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