The Constitution Matters in Taxation (original) (raw)

At bottom, what all of this means to Professor Johnson is that, in evaluating the legitimacy of an unapportioned tax today, we should go back to the understanding of the Hylton justices, under which nothing but a capitation tax or a tax on real estate should be subject to apportionment. 8 And, if there's any doubt about the appropriate result in a particular case, Johnson urges us to use "manipulative expansion" of 5 See U.S. Const. art. I, sec. 2, cl. 3: Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three-fifths of all other Persons. See also U.S. Const. art. I, sec. 9, cl. 4 ("No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken."). Apportionment therefore means that a state with, say, one-twentieth of the national population must bear one-twentieth of the aggregate liability associated with any direct tax, regardless of the state's percentage of the national tax base. 6 3 U.S. (3 Dall.) 171 (1796). 7 157 U.S. 429 (1895) (holding unapportioned tax on income from real estate unconstitutional); 158 U.S. 601 (1895) (extending principle to income from personal property and rejecting entire 1894 tax). 8 Hylton, 3 U.S. (3 Dall.) at 175 (Chase, J.); id. at 183 (Iredell, J.); id. at 177 (Paterson, J.); see infra notes 75-77 and accompanying text. Given what Johnson says about wealth taxes, he must think that even a tax on real estate is no longer subject to apportionment.