P.M. BRIEFING : Multinationals Taxing to Be Settled
The Supreme Court agreed today to settle some key questions involving the ability of multinational corporations to challenge state taxes in federal court.
What the justices decide sometime next year in a California case could have big-money significance for most states and many big businesses.
The justices, granting an appeal by California officials, said they will review a ruling that allowed two multinational corporations to challenge a state tax in federal court.
In a 1984 ruling seen as a major victory for states, the justices held that California may tax multinational corporations based on the businesses’ worldwide income.
But that decision applied only to multinationals whose parent company is located in the United States.
The case acted on today involves multinationals whose parent company is based in a foreign country.
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