In the case of District of Columbia v. R.P. Andrews Paper Company in 1920, the Supreme Court ruled on a dispute regarding taxation between the District of Columbia and a paper company operating within its jurisdiction. The R.P. Andrews Paper Company was assessed for taxes by the district but refused to pay them, arguing that it was exempt from such local levies because it operated under a federal charter granted by Congress. The court disagreed with this argument, ruling that even though Congress had authority over Washington D.C., this did not mean businesses there were immune from local taxation laws just because they held federal charters or licenses to operate their business activities in other states as well as D.C.. Therefore, despite being federally chartered companies they are still subject to local tax laws unless specifically exempted by law.

The dissenting opinion in the case of District of Columbia v. R.P. Andrews Paper Company argued that the tax imposed by Congress on businesses operating within Washington D.C., including those incorporated outside of it, was constitutional and did not violate due process rights under the Fourteenth Amendment. The dissent contended that since these corporations were doing business within D.C., they benefited from its infrastructure, services, and protections provided by local government; therefore, it was only fair for them to contribute towards their maintenance through taxation. Furthermore, this tax did not discriminate against out-of-state companies as all businesses operating in D.C., regardless of where they were incorporated or headquartered, had to pay it equally. Thus according to this view point there was no violation of equal protection clause either.