The United States Since the Civil WarLingley, Charles Ramsdell
History
The United States Since the Civil War
Lingley, Charles Ramsdell
United States -- History -- 1865-1921
Yet one more drop remained to fill the cup of Democratic humiliation to
overflowing. The constitutionality of the income tax had been assumed
to have been settled by previous decisions of the Supreme Court,
especially that in the case Springer _v._ United States, which had been
decided in 1880, and in which the Court had upheld the law. The new tax
was brought before the Court in 1894, in Pollock _v._ Farmers' Loan and
Trust Company. The argument against the tax was pressed with great
vigor, not merely on constitutional grounds, but for evident social and
economic reasons. Important financial interests engaged powerful legal
talent and it became clear that the question to be settled was as much
a class and sectional controversy as a constitutional problem. Counsel
urged the Court that the tax scattered to the winds the fundamental
principles of the rights of private property. Justice Field, deciding
against the tax, declared it an "assault upon capital" and a step
toward a war of the poor against the rich. There was fear among some
that the exemption of the smaller incomes might result in placing the
entire burden of taxation on the wealthy. Justice Field, for example,
felt that taxing persons whose income was $4,000 and exempting those
whose income was less than that amount was like taxing Protestants, as
a class, at one rate and Catholics at another. The sectional aspects of
the controversy were brought out in objections that the bulk of the tax
would fall on the Northeast. The most important point involved was the
meaning of the word "direct" as used in the Constitution in the phrase
"direct Taxes shall be apportioned among the several States ... according
to their respective Numbers." If an income tax is a direct tax, it must
be apportioned among the states according to population. Unhappily the
framers of the Constitution were not clear as to what they meant by
the word direct, and specifically they could not have told whether an
income tax was direct or not, because no such tax existed in England
or America at that time. Hence the Supreme Court was placed in the
awkward position of defining a word which the framers themselves could
not define, although the uniform practice hitherto had been to regard
the income tax as indirect and therefore constitutional, even if not
apportioned according to population.
Public-domain text, read in full here on John Shaqi.
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