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Intergovernmental Competition for Energy Resources

Commissioner Dorgan is quite right that North Dakota, like other states, possesses a sovereign right to levy taxes in the manner of its choosing provided only that it does not discriminate against interstate commerce in a gross and overt way. I am only surprised that he feels a need to defend North Dakota’s use of its indisputable right. Anyone, it is true, has cause to be nervous when squaring off with the politically powerful energy industry. When North Dakota’s neighbors, the western Canadian provinces, increased royalties on minerals in the early 70s, Ottawa responded by denying the deductibility of these royalties for federal income tax. Such can be the fate of colonial areas politically dominated by metropolitans. North Dakota’s weakness in Washington may be exemplified by the statistic that her farmers report 69% of their income for federal tax purposes, less than you or I perhaps but more than the farmers in any other state.
NTA Proceedings, 70th Annual Conference, Louisville, 1978. Discussant.

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