Disney, IBM New York Case Tees Up Commerce Clause for Justices

A recent decision about New York’s tax treatment of foreign royalties will give the US Supreme Court a chance to take up another state tax case about the scope of the dormant commerce clause.

New York’s highest court ruled April 23 that Walt Disney Co. and IBM Corp. can’t deduct payments from their foreign affiliates that produce and license intellectual property under a state law add-back provision in effect from 2003 to 2013. The court upheld the New York Department of Taxation and Finance’s interpretation of the statute and held that any burden it created on interstate or foreign commerce ...