In the 1940 case of Best & Company, Inc. v. Maxwell, Commissioner of Revenue of North Carolina, the U.S Supreme Court ruled in favor of North Carolina's right to tax out-of-state businesses operating within its borders. The dispute arose when New York-based retailer Best & Co., which sold goods through mail order and traveling salespeople but did not have a physical store in North Carolina, was taxed by the state for its business activities there. Best & Co argued that this taxation violated their rights under both the Due Process Clause and Commerce Clause of the Constitution as they had no physical presence or "nexus" in NC. The court disagreed with this argument stating that since company representatives were physically present conducting business operations such as taking orders and delivering merchandise within NC boundaries on a regular basis; it constituted sufficient nexus for imposing taxes without violating constitutional principles. This ruling affirmed states' authority to levy taxes on interstate commerce provided there is substantial connection between taxing state and taxpayer’s activity.

In the dissenting opinion for BEST & COMPANY, INC. v. MAXWELL, it was argued that North Carolina's imposition of a use tax on goods purchased out-of-state and then brought into the state for personal or business use violated the Commerce Clause of the U.S. Constitution by discriminating against interstate commerce. The dissenting justices contended that this taxation scheme effectively penalized residents for purchasing goods from out-of-state vendors, thereby discouraging such transactions and favoring in-state businesses over their out-of-state counterparts. They further asserted that allowing states to impose such taxes would lead to economic protectionism and disrupt free trade among states - outcomes contrary to what framers intended when they drafted the Commerce Clause.