FW Woolworth Co. v. Taxation and Revenue Dept. of NM

The question is whether the Due Process Clause permits New Mexico to tax a portion of dividends that appellant F. W. Woolworth Co. received from foreign subsidiaries that do no business in New Mexico. We also must decide whether New Mexico may include within Woolworth’s apportionable New Mexico income a sum, commonly known as “gross-up,” that Woolworth calculated in order to claim a foreign tax credit on its federal income tax.

I

Woolworth’s principal place of business and commercial domicile are in New York. It engages in retail business through chains of stores located in the United States,…