On June 6, 2013, the Michigan Court of Claims became the second court in the country to hold that the Multistate Tax Compact (the Compact) is a binding multistate compact that cannot be repealed by a separate, subsequent statute. Anheuser-Busch, Inc. v. Michigan Dep’t of Treasury, Case No. 11-85-MT (Order and Opinion, Mich. Ct. of Claims June 6, 2013) (Collette, J.). The taxpayer was thus entitled to apportion its income under the former Business Income Tax (BIT) component of the Michigan Business Tax (MBT) using the Compact’s equally-weighted three factor formula rather than the statutory single sales factor formula.

The decision is significant because it represents the first court since the California Court of Appeal’s seminal decision in Gillette to apply interstate compact law principles in upholding the Compact’s election. See Gillette Co. v. Franchise Tax Bd., 209 Cal. App. 4th 938 (2012), review granted and opinion superseded sub nom., 291 P.3d 327 (Cal. Jan. 16, 2013).