Governance Civil Justice
October 18th, 2022 1 Minute Read Amicus Brief by Ilya Shapiro

Amicus Brief: Halstead Bead, Inc. v. Richard


Halstead Bead is a family-owned and -operated jewelry and craft supplier based in Arizona. The company’s nationwide sales are online or via catalog. The company sued the state of Louisiana for unconstitutionally interfering with interstate commerce under what’s known as the negative or “dormant” Commerce Clause.

Louisiana has one of the most difficult sales tax systems in the country, with each of their 63 parishes (counties) adopting separate sales tax systems with disparate definitions, taxability requirements, and administration. Collecting Louisiana sales tax correctly would cost Halstead Bead $11,000 over three years to collect a few thousand dollars of sales tax, so it cuts off sales before crossing Louisiana’s 200-transaction threshold each year.

In 2017, the Supreme Court decided South Dakota v. Wayfair, allowing states to require out-of-state businesses to collect sales taxes on online sales if the state implements certain safeguards (which Louisiana has not done). But the federal district court dismissed this lawsuit on jurisdictional grounds, under the Tax Injunction Act and sister-state comity. Now on appeal before the Fifth Circuit, the Manhattan Institute has joined the National Federation of Independent Business and two other groups on an amicus brief that addresses two issues: (1) the due process concerns of having state court judges adjudicate disputes between out-of-state entities and the state’s revenue collectors, and (2) the complexities of Louisiana’s sales-tax regime for both brick-and-mortar businesses and remote sellers, which imposes a burden on interstate commerce.


Ilya Shapiro is a senior fellow and director of Constitutional Studies at the Manhattan Institute. Follow him on Twitter here.


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