In the 1902 case of Layton v. Missouri, the U.S Supreme Court ruled on a dispute involving taxation and interstate commerce. The appellant, William Layton, was a commercial traveler based in Illinois who sold goods for his employer in Missouri without having a permanent business location there. He contested Missouri's requirement that he pay an annual license tax to conduct such business activities within its borders. Layton argued this violated both the Commerce Clause and Fourteenth Amendment of the Constitution by imposing undue burdens on interstate commerce and denying him equal protection under law. However, the court upheld Missouri's right to levy such taxes as long as they were not discriminatory or excessive compared to those imposed on local businesses conducting similar operations within state lines. It concluded that states had authority over their own internal trade regulations unless explicitly prohibited by federal law or constitutionally protected rights - which it did not find applicable here. The decision affirmed that while states cannot impede free flow of interstate commerce through prohibitive taxation or regulation, they can impose reasonable fees for benefits provided like police protection and public infrastructure use.

In the dissenting opinion for Layton v. Missouri, it was argued that the state of Missouri had no right to tax a federal corporation's property located within its borders. The dissenting justices believed that such taxation infringed upon federal sovereignty and violated constitutional principles. They contended that while states have broad powers to levy taxes, these powers should not extend to taxing federally chartered entities without explicit congressional approval. Furthermore, they asserted that this case could set a dangerous precedent where states might feel emboldened to impose burdensome or discriminatory taxes on federal institutions in an attempt to undermine their operations or drive them out of business entirely.