Bachus Imports Inc. v Dias
S. Ct. 1984
Author: Sam Biers

Relevant Facts: A liquor wholesaler, selling to retailers, paid a 20% tax plus .5% on liquor sold.  Local liquor are exempt.  Based on that the wholesaler is suing to recover all taxes paid.

Legal Issue(s): Whether the tax exemption, although violating the Commerce Cl. is valid under the 21^st Amendment?

Court’s Holding: Yes

Procedure: Tax Ct. held for Df-Dias, S.Ct. Of HA affirmed,

Law or Rule(s):   21^st - The transportation or importation into any State for delivery, or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited.

Court Rationale: The 21^st Amendment did not entirely remove state regulation of alcoholic beverages from the ambit of the C. Cl.  The central purpose of the provision was not to empower States to favor local industries by erecting barriers to competition.  The State does not seek to justify its tax on the ground that it was designed to promote temperance or to carry out any other purpose of the 21^st but only to promote local industry.  The tax violates a central tenet of the C. Cl. and is not supported by any clear concern of the 21^st.

Plaintiff’s Argument: The tax violates the C. Cl. by discriminating local interests against out of state interests.

Defendant’s Argument: Dias- okolehao and pineapple wine do not compete with other products sold by wholesalers, and the state is free to legislate and regulate the sale, importation, and transportation of liquor.