Supreme Court of the United States

Prudential Insurance Co. v. Benjamin, Insurance Commissioner

June 3, 1946328 U.S. 408

Summary

The Court, through Justice Rutledge, upheld South Carolina’s premium tax on foreign insurance companies. The McCarran Act authorized continued state taxation of insurance, including this tax, and Congress could remove dormant Commerce Clause objections even assuming that the tax discriminated against interstate commerce. The Court did not decide whether the tax actually discriminated or whether all the taxed business constituted interstate commerce. It also rejected challenges based on due process, federal tax uniformity, legislative power, reserved state taxing authority, and unconstitutional delegation. Justice Black concurred in the result without a separate opinion; Justice Jackson did not participate.

Holding

  • Whether the McCarran Act covered South Carolina’s premium tax on foreign insurance companies.. The Act supported continued collection of the tax, including against a Commerce Clause challenge premised on discrimination against interstate commerce.
  • Whether Congress could authorize a state insurance tax assumed to discriminate against interstate commerce.. Congress could consent to the tax and remove objections arising from the dormant Commerce Clause.
  • Whether other constitutional limitations invalidated the Act or the tax.. The asserted due process, uniformity, legislative-power, reserved-state-power, and delegation objections did not invalidate the Act or South Carolina’s tax.

Docket 707

Cited authorities

  • 59 Stat. 33
  • 23 Tex. L. Rev. 18
  • 18 Va. L. Rev. 1
  • 25 Minn. L. Rev. 432
  • 41 Harv. L. Rev. 200
  • 27 Va. L. Rev. 1
  • 26 Stat. 313
  • 36 Mich. L. Rev. 752

Cited by

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