Gurley v. Rhoden

PETITIONER: W. M. Gurley dba Gurley Oil Co.
RESPONDENT: Arny Rhoden, Chairman, Tax Commission of Mississippi
LOCATION: Tax Comission of Mississippi

DOCKET NO.: 73-1734
DECIDED BY: Burger Court (1972-1975)
LOWER COURT: Supreme Court of Mississippi

CITATION: 421 US 200 (1975)
ARGUED: Mar 18, 1975
DECIDED: May 12, 1975
GRANTED: Nov 18, 1974

ADVOCATES:
Charles R. Davis - for petitioner
Hunter M. Gholson - for respondent

Facts of the case

Gurley Oil Co. owned five gas stations in Mississippi and purchased gas tax-free out of state. Gurley added both federal and state excise taxes on to the retail price of the gasoline. Mississippi imposed an additional 5% tax on the “gross proceeds” of all gas sales. Mississippi did not permit Gurley to deduct the state and federal excise taxes from the “gross proceeds” before calculating the 5% tax. Gurley paid the tax under protest, but sued for a refund. They alleged that not allowing a pretax deduction of the excise taxes was an unconstitutional taking under the Fifth Amendment. Gurley argued that the company was just a collector of taxes paid by the consumer, so those taxes were not actually part of his gross receipts. The chancery court dismissed the suit and the Supreme Court of Mississippi affirmed.

Question

Is Mississippi’s tax on the “gross proceeds”, including the amount collected to pay federal and state excise taxes, an unconstitutional taking?

Media for Gurley v. Rhoden

Audio Transcription for Oral Argument - March 18, 1975 in Gurley v. Rhoden

Audio Transcription for Opinion Announcement - May 12, 1975 in Gurley v. Rhoden

Warren E. Burger:

The judgment and opinion of the Court in No. 73-1734, Gurley against Rhoden will be announced by Mr. Justice Brennan.

William J. Brennan, Jr.:

This case is here from the Supreme Court of Mississippi.

The Mississippi 5% sales tax is applied to the pump price of gasoline.

That pump price is increased 13 cents represent federal and state excise taxes passed on by the retailer to the motorist.

The Mississippi Supreme Court held that this does not render the sales tax an unconstitutional tax upon a tax.

We agree and affirm.

Mr. Justice Douglas took no part in the consideration or decision of the case.