Supreme Court Declares Income Tax Unconstitutional
The Supreme Court declared the income tax to be null and void in a momentous 5-4 decision written by the Chief Justice. Congress no longer has the power to invoke, impose and collect an income tax.
Senator David Hill said about the decision, “I am naturally gratified. I never had any doubt that the tax is unconstitutional and there was never any good reason for the income tax law. It was pressed upon Congress by a lot of cranks and disturbers.”
In an editorial addressing this decision, the New York Times said it was a remarkable win against an unfair, unpatriotic and unwise law. The Times also saw the decision as evidence that the Court is capable of resisting the influence of partisan prejudice.
Thomas Harland, ex-Deputy Commissioner of Internal Revenue, said a few days before the decision, that even if it were not overturned, he could not imagine how the tax could be administered, and it would need to rely primarily on voluntary disclosure – a far-fetched notion.
The issue was not whether the government had a need for the funds or should have the funds, but rather the method of taxation. It had been clearly felt that the Federal Government had no right to directly tax individuals, only the states could do that. A major issue that was not ruled upon was the inequity of the tax which exempted 98% of the population and was considered a tax only on the wealthy.
The entire decision, and concurring opinions, is cited as Pollack v. Farmers Loan & Trust Co. (157 U.S.429; 15 S.Ct.673).
Post script: Happy April 1st! However, surprise of surprises – everything written here is true and actually took place, but in 1895! The 16th Amendment was enacted in 1913 to make an income tax constitutional. On March 1, 1913, the first income tax Form 1040 (the next available federal form number) was made available. The 1895 tax was 2% on income over $4,000 (equivalent to about $105,000 in today’s buying power). Also, the first tax law was tacked on to other legislation and was enacted on October 3, 1913 retroactive to March 1, 1913. Some things never seem to change!
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