In the case of Reading Railroad Company v. Pennsylvania, the Supreme Court of the United States was asked to decide whether a state tax on railway gross receipts was constitutional. The Reading Railroad Company argued that the tax was unconstitutional because it violated the Commerce Clause of the United States Constitution. The Supreme Court disagreed and held that the tax was constitutional. The Supreme Court reasoned that the tax was not a burden on interstate commerce because it was imposed on the gross receipts of the railroad, not on the goods or passengers that were transported. The Court also noted that the tax was imposed on all railroads operating within the state, regardless of whether they were engaged in interstate commerce. The Court concluded that the tax was a valid exercise of the state's power to tax and did not violate the Commerce Clause. The Court's decision in this case established the principle that states may impose taxes on the gross receipts of railroads operating within their borders, even if the railroads are engaged in interstate commerce. This principle has been applied to other forms of taxation, such as taxes on the gross receipts of businesses, and has been used to uphold the constitutionality of state taxes on interstate commerce.

In the case of Reading Railroad Company v. Pennsylvania, the Supreme Court was tasked with determining whether or not a state tax on railway gross receipts violated the Constitution. The majority opinion held that it did not violate any constitutional provisions and thus upheld the state's right to impose such taxes. However, Justice Field dissented from this decision and argued that states should be limited in their ability to tax interstate commerce as outlined by Congress under Article I Section 8 of the Constitution. He further argued that allowing states to freely impose taxes on goods moving between them would lead to an increase in taxation which could ultimately impede economic growth across all states involved. Additionally, he noted that if each individual state were allowed free reign over taxing interstate commerce then they could effectively create monopolies within their own borders at other’s expense; something which is expressly forbidden by Article I Section 10 of the Constitution. As such, Justice Field concluded his dissent by arguing for greater federal control over taxation related matters involving multiple states so as to ensure fair competition amongst them while also protecting citizens from excessive taxation imposed upon them without due process or representation