Michigan Law Review, Vol. 87, No. 1 (October 1988), pp. 138-188


Before 1983, the Supreme Court had never uttered the phrase "internal consistency" in a state tax opinion. Since 1983, however, the Court has invoked the principle of "internal consistency" on four separate occasions in adjudicating the validity of state taxes under the commerce clause. Indeed, by 1987, the Court could refer almost casually to the "internal consistency" criterion as "the test ... we have applied in other contexts." The Court's talk of "internal consistency" cannot be dismissed as mere rhetoric. Three of the four taxes that have been put to the "internal consistency" test have flunked it; cases approving taxes that, in retrospect, would have failed the test have been overruled; and the test has cast a constitutional shadow over many other taxes. In the eyes of some members of the Court, moreover, general application of the "internal consistency" doctrine as a tool of commerce clause analysis is "an entirely novel enterprise" that would "revolutionize the law of state taxation." Whatever role "internal consistency" may come to play in the Court's commerce clause jurisprudence, it has already emerged as a doctrine that warrants our attention. This article traces the development of the doctrine, explores its implications, and considers its defensibility as a limitation on state taxing power. The article suggests that the results the Court reaches under the "internal consistency" doctrine could be reached by rigorous application of a more familiar commerce clause principle--one to which the Court has been less than faithful.