Editing Dormant Commerce Clause (section)

==Taxation of international commerce==
In addition to satisfying the four-prong test in ''Complete Auto Transit'', the Supreme Court has held state taxes which burden international commerce cannot create a substantial risk of multiple taxations and must not prevent the federal government from "speaking with one voice when regulating commercial relations with foreign governments".<ref>''Japan Lines, Ltd. v. County of Los Angeles'', 441 U.S. 434 (1979).</ref> 

In ''Kraft Gen. Foods, Inc. v. Iowa Dept. of Revenue and Finance'', 505 U.S. 71 (1992), the Supreme Court considered a case in which Iowa taxed dividends from foreign subsidiaries, without allowing a credit for taxes paid to foreign governments, but not dividends from domestic subsidiaries operating outside Iowa. This differential treatment arose from Iowa's adoption of the definition of "net income" used by the [[Internal Revenue Service]]. For federal income tax purposes, dividends from domestic subsidiaries are allowed to be exempted from the parent corporations income to avoid double taxation. The Iowa Supreme Court rejected a Commerce Clause claim because Kraft failed to show "that Iowa businesses receive a commercial advantage over foreign commerce due to Iowa's taxing scheme." Considering an Equal Protection Clause challenge, the Iowa Supreme Court held that the use of the federal government's definitions of income were convenient for the state and was "rationally related to the goal of administrative efficiency". The Supreme Court rejected the notion that administrative convenience was a sufficient defense for subjecting foreign commerce to a higher tax burden than interstate commerce. The Supreme Court held that "a State's preference for domestic commerce over foreign commerce is inconsistent with the Commerce Clause even if the State's own economy is not a direct beneficiary of the discrimination."