In the 1897 case Hodgson v. Vermont, the U.S Supreme Court ruled on a dispute involving interstate commerce and state taxation powers. The plaintiff, Mr. Hodgson, was an out-of-state businessman who sold goods in Vermont but stored his merchandise in New York between sales trips. He argued that he should not be subject to personal property taxes levied by Vermont because his goods were not physically present within the state at the time of assessment and thus did not benefit from any services provided by it. The court disagreed with this argument stating that as long as there was sufficient connection or nexus between a taxpayer's business activities and a taxing jurisdiction (in this case, selling goods), then tax could be imposed even if physical presence is lacking during tax assessment period. This decision affirmed states' rights to impose taxes on out-of-state businesses operating within their borders under certain conditions which has significant implications for modern e-commerce where physical presence often does not coincide with place of business operations.

In the dissenting opinion for Hodgson v. Vermont, Justice Harlan argued that the majority's decision to uphold a state law allowing taxation of national bank shares at higher rates than other moneyed capital in active business operations was inconsistent with previous Supreme Court rulings and federal legislation. He contended that such differential treatment violated the principle of equality embodied in the Fourteenth Amendment's Equal Protection Clause. Harlan emphasized that all forms of property should be taxed equally under state laws, irrespective of their nature or form. Furthermore, he expressed concern about states potentially exploiting this ruling to impose excessive taxes on national banks, thereby undermining their stability and effectiveness as federally chartered institutions designed to support nationwide commerce and finance.