Is the Federal Income Tax Legal under the 16th Amendment - Research Paper Example

The constitutionality of the 16th Amendment has been the subject of controversy and challenge since its inception, particularly since it was not ratified by all US States and outright rejected by at least three states.  Despite the issues raised, the US Supreme Courts have continued to uphold the Constitutionality of the 16th Amendment.  This paper examines the history and background of income taxes within the context of the US Constitution and highlights the legal issues that give rise to the controversy over the constitutional power conferred upon Congress to collect Federal income taxes.

  It will be argued that the authority is limited and that the 16th Amendment confers upon Congress an authority that the Constitution does not provide for.  The constitutionality of the 16th Amendment is also questionable on the grounds that it was not ratified by each of the fifty states. The 16th Amendment to the US Constitution confers upon Congress the authority to levy income taxes without having to apportion the tax between the individual states. Neither is it necessary for the taxes to bases on a census (US Constitution 16th Amendment).

The 16th Amendment reversed the decision of the US Supreme Court in Pollock v Farmers & Trust Co (1895) which essentially held that unapportioned taxes on income from interest, dividends and rents pursuant to the Wilson-Gorman Tariff Act 1894 were characterized as direct taxes and were, therefore, ultra vires the US Constitution. The contravention arises because the Constitution requires that direct taxes were required to be apportioned (Pollock v Farmers & Trust Co 1895). Article 1, Section 8 of the US Constitution is seemingly straightforward in that it provides Congress with the authority to “Lay and Collect Taxes, Duties, Imposts and Excises,” for the purpose of paying “the Debts and provide for the common Defence and general Welfare of the United States” (US Constitution, Article 1, Section 8).

However, Article 1, Section 8 contains a proviso which directs that the authority to levy taxes “shall be uniform” across the US (US Constitution Article 1, Section 8). Yet another limitation is contained in Article 1, Section 9 which provides as follows: No capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.  No Tax or Duty shall be laid on Articles exported from any State. In other words, the constitutional power conferred on Congress to levy taxes cannot be posted against exports and is required to be uniform across the US and direct taxes are required to be based on a population census.

Although these constraints on taxing authority are seemingly straightforward, taxing authority has given way to a fierce debate over two centuries.