INDIRECT ENCROACHMENT ON FEDERAL AUTHORITY 66 1 longer concerned. Our present interest is in the objection that the income from some of these sales was not derived from business transacted and property located within the state, and so not within the terms of the Wisconsin statute. The income covered by these objections included (i) that from goods sold and delivered from the Wisconsin factory to persons outside the state; (2) that from products of the Wisconsin factory shipped to extra-state branch houses and from there sold to cus- tomers outside Wisconsin; and (3) that from goods bought with- out the state, shipped to extra-state branches either directly or by way of the Wisconsin factory, and then sold and delivered from the extra-state branches to extra-state customers.^^ As to this last class of business the Wisconsin court held that the income therefrom was not from business or property within Wis- consin. But Wisconsin was declared to be the source of all in- come from sales of products of the Wisconsin factory including those of goods disposed of from the branch houses in other states. After saying that "the place of sale of such products does not change the place of business from this to the state where the goods are sold," ®* Judge Siebecker continued: "The transactions involved in producing the products at the plant at Carrollville and disposing of them through intra-state or interstate transactions are in substance and effect transacting business in this state, and the shipping and delivery of such goods on sales made at home or abroad, from either the factory or branch houses to which they had been shipped before sale, are no more than incidents in transacting the business of supplying the articles to customers in their finished state. We cannot, in the light of the nature of the general conduct of the busi- ness, assent to the claim that the shipping and delivery of goods, manu- factured at the plant, from branch houses are the controlling elements of such transactions and that they give such business a situs without the state. The manufacture, the management, and the conduct of the business at the home office are the controlling features in the process of disposing of the article produced at the factory and constitute the source out of which the income issues and give it a situs within the state under the Income Tax Law," ^^ This view of the "situs" of income invites examination. If the professed basis of the Wisconsin tax on business income is not 9' 161 Wis. 213-14, 153 N. W. 241 (1915). M Ihid., 218. » lUd.
