INDIRECT ENCROACHMENT ON FEDERAL AUTHORITY 663 sense that they are the factors that make the difference between profit and loss. These factors in interstate sales all occur outside the state of manufacture. The manufacture without the customer would be as vain as the customer without the goods to sell him. The state where the solicitation is done and where accounts must be collected offers to the business the protection of its poUce offi- cials and its courts. If net income from interstate commerce is no longer to be exempt from state taxation, and if each state where income is earned is to be allowed to levy on that income irrespective of the domicil or legal character of the recipient, it is artificial to insist that either the manufacture or the securing of a customer is a mere "incident" or that either is " controUing, " if controlling means of exclusive importance. Judge Siebecker's insistence that the extra- Wisconsin activities of the United States Glue Company were not entitled to legal consideration would have been more com- pelhng if it had been based on the power of Wisconsin over its own corporate creatures. This ground, however, was not open to him under the Wisconsin statute. It does not appear to have been urged before the Supreme Court that the interpretation put upon the statute as to "situs" of the income in question raised an issue under the commerce clause. The Supreme Court might refuse to consider such a question in a case where state power over the re- cipient of income furnished sufficient justification for the result sanctioned by the state court. But it may be expected that other disputes will bring before the Supreme Court some important con- stitutional issues over the situs of income. Another phase of this same problem appears in Shaffer v. Howard,^^ decided by the federal district court for the Eastern District of Oklahoma. The case involved the application of the Oklahoma income tax to the income of non-residents' Mr. Shaffer was domiciled in Chicago and owned and operated oil wells in Oklahoma. He contended that none of the income from these wells was taxable by Oklahoma, because the state had no power over him personally, and the income was "made up from two in- separable elements — the property and the owner's management and intelligence — and the latter of these is outside the state. "^^ To this. Judge Cotteral answered: »« 250 Fed. 873 (1918). »» 250 Fed. 873, 874 (1918).
