Texas High Court Questions Margin Tax In Nestle Dispute

Law360, Dallas (September 18, 2012, 3:39 PM EDT) -- Texas Supreme Court justices on Tuesday pressed Nestle Inc. and the state to define the limits of the state constitution’s “equal and uniform” taxation clause and whether the margin tax imposed on businesses breaches those limits.

The state replaced its previous business franchise tax in 2008 with a margin tax that charges retailers and wholesalers half the tax rate that applies to other business. Companies are allowed to deduct the cost of goods sold or the cost of employee compensation.

Nestle in June filed its second...
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