This Article reviews the Sixth Circuit’s approach in Cuno v. DaimlerChrsyler in determining whether a state-level investment tax incentive is coercive and therefore unconstitutional under the Dormant Commerce Clause, and argues that the court should look at diversifying factors that could be decisive on the date that a business decision was made to leave a state (or reduce its number of employees in that state), not just on the date that the initial selection of receiving tax incentives was made in the consideration of “practical and economic effect.” This Article begins by offering an overview of state-level investment tax incentives and a brief explanation of different types of those incentives—customized or generally available incentives. This section focuses especially on how we should balance federal and state interests—the free trade policy and state’s right to economic development—and other associated problems of interstate competition. Next, the Article discusses major theories advanced to delineate constitutional incentives from invalid discriminations against interstate commerce depending on the different interpretations of case law and the underlying values of the Commerce Clause. The theories are considered using Cuno as a case study. In Cuno, the Sixth Circuit followed Professors Walter Hellerstein & Dan T. Coenen’s Coercive Powers Theory that bifurcates its approach by holding that Ohio’s investment tax credit (ITC) was impermissible due to its previously incurred corporate franchise tax; by contrast, the Court held that Ohio’s personal property tax exemption was permissible because there were no existing tax liabilities. This Article argues that the Court, by exclusively focusing on the preexisting tax liabilities on the date of the initial selection of receiving those incentives, overlooked other significant factors that could be decisive in determining the constitutionality of those incentives. To illustrate this point, I have estimated how the permissible property tax exemption could coerce businesses to maintain or increase the level of in-state activities by setting up a mathematical model of those incentives that integrate a clawback provision during economic downturns. The simulated results of this Article reveal that the potential burden of receiving a personal property tax exemption could exceed ITC’s preexisting burdens since property tax exemption’s burden would become payable upon leaving the state. Thus, property tax exemptions can be relatively more coercive than ITCs. In applying the Coercive Powers Theory, although Professors Hellerstein & Coenen were concerned as to some theoretically drawn exceptions that could defeat the distinction, they emphasized that other factors that reflect practical and economic effect must be considered in determining whether a state tax incentive is coercive. This Article concludes that a personal property tax exemption with a clawback clause could be a good example of taking into account the economic effect in determining the permissibility of state tax incentives, and the Court’s analysis on the ITC can be considered erroneous relative to the property tax exemption. From a tax policy perspective, the Article briefly discusses issues of the method in which the incentives are granted. Depending on the type of tax incentives, they could potentially create greater horizontal or vertical inequality and be more likely abused by politicians at their discretion coupled with an associated problem of difficulties in evaluating costs and benefits of a state-tax incentive.