Springer v. United States

102 U.S. 586

Case Year: 1881

Case Ruling: 9-0, Affirmed

Opinion Justice: Swayne

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FACTS

In June 1866 William M. Springer, an Illinois attorney, received a notice from an assistant assessor of internal revenue requiring him to file a tax return listing all of his income, gains, and profits for the previous year. Springer filed the return but refused to pay the $4,799.80 in taxes due because he believed that the federal income tax was constitutionally invalid. In Springer’s view the income tax was a “direct tax” and therefore had to be apportioned on the basis of population. Since the tax was not apportioned, it was unconstitutional.

Because of Springer’s failure to pay the required taxes, federal authorities successfully moved to have some of his property sold. After putting it up for auction, the United States purchased the property for the amount of taxes owed, then moved to have Springer ejected when he refused to move off the land. Springer responded by claiming that he did not owe a debt to the United States because the tax--the basis for the debt--was unconstitutional.

The key to Springer’s case was whether the federal income tax fell into the “direct tax” category. If it did, the tax was invalid because it had not been apportioned on the basis of population. When the case arrived at the Supreme Court, the justices devoted their attention to defining what kinds of taxes fell into the direct tax classification.


 

MR. JUSTICE SWAYNE, AFTER STATING THE FACTS, DELIVERED THE OPINION OF THE COURT.

The central and controlling question in this case is whether the tax which was levied on the income, gains, and profits of the plaintiff in error, as set forth in the record, and by pretended virtue of the acts of Congress and parts of acts therein mentioned, is a direct tax. It is fundamental with respect to the rights of the parties and the result of the case....

The clauses of the Constitution bearing on the subject are as follows:--

‘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 those bound to service for a term of years, and excluding Indians not taxed, three-fifths of all other persons.... No capitation or other direct tax shall be laid unless in proportion to the census hereinbefore directed to be taken.’

Was the tax here in question a direct tax? If it was, not having been laid according to the requirements of the Constitution, it must be admitted that the laws imposing it, and the proceedings taken under them by the assessor and collector for its imposition and collection, were all void....

It does not appear that an attempt was made [at the Constitutional Convention] by any one to define the exact meaning of the language employed.

In the twenty-first number of the Federalist, Alexander Hamilton, speaking of taxes generally, said: ‘Those of the direct kind, which principally relate to land and buildings, may admit of a rule of apportionment. Either the value of the land, or the number of the people, may serve as a standard.’...

Hamilton left behind him a series of legal briefs, and among them one entitled ‘Carriage tax.’ This paper was evidently prepared with a view to the Hylton case, in which he appeared as one of the counsel for the United States. In it he says: ‘What is the distinction between direct and indirect taxes? It is a matter of regret that terms so uncertain and vague in so important a point are to be found in the Constitution. We shall seek in vain for any antecedent settled legal meaning to the respective terms. There is none. We shall be as much at a loss to find any disposition of either which can satisfactorily determine the point.’...

It is important to look into the legislation of Congress touching the subject since that time....

... [W]henever the government has imposed a tax which it recognized as a direct tax, it has never been applied to any objects but real estate and slaves.... It does not appear that any tax like the one here in question was ever regarded or treated by Congress as a direct tax. This uniform practical construction of the Constitution touching so important a point, through so long a period, by the legislative and executive departments of the government, though not conclusive, is a consideration of great weight.

There are four adjudications by this court to be considered. They have an important, if not a conclusive, application to the case in hand. In Hylton v. United States, a tax had been laid upon pleasure-carriages. The plaintiff in error insisted that the tax was void, because it was a direct tax, and had not been apportioned among the States as required by the Constitution, where such taxes are imposed. The case was argued on both sides by counsel of eminence and ability. It was heard and determined by four judges,--Wilson, Paterson, Chase, and Iredell. The three first named had been distinguished members of the constitutional convention. Wilson was on the committee that reported the completed draft of the instrument, and warmly advocated its adoption in the State convention of Pennsylvania. The fourth was a member of the convention of North Carolina that adopted the Constitution. The case was decided in 1795. The judges were unanimous. The tax was held not to be a direct tax....

In Pacific Insurance Co. v. Soule, the taxes in question were upon the receipts of such companies from premiums and assessments, and upon all sums made or added, during the year, to their surplus or contingent funds. This court held unanimously that the taxes were not direct taxes, and that they were valid.

In Veazie Bank v. Fenno, the tax which came under consideration was one of ten per cent upon the notes of State banks paid out by other banks, State or National. The same conclusions were reached by the court as in the preceding case. Mr. Chief Justice Chase delivered the opinion of the court. In the course of his elaborate examination of the subject he said, ‘It may be rightly affirmed that, in the practical construction of the Constitution by Congress, direct taxes have been limited to taxes on land and appurtenances and taxes on polls, or capitation taxes.’

In Scholey v. Rew, the tax involved was a succession tax, imposed by the acts of Congress of June 30, 1864, and July 13, 1866. It was held that the tax was not a direct tax, and that it was constitutional and valid. In delivering the opinion of the court, Mr. Justice Clifford, after remarking that the tax there in question was not a direct tax, said: ‘Instead of that, it is plainly an excise tax or duty, authorized by sect. 1, art. 8, of the Constitution, which vests the power in Congress to lay and collect taxes, duties, imposts, and excises to pay the debts and provide for the common defence and public welfare.’

He said further: ‘Taxes on houses, lands, and other permanent real estate have always been deemed to be direct taxes, and capitation taxes, by the express words of the Constitution, are within the same category; but it has never been decided that any other legal exactions for the support of the Federal government fall within the condition that unless laid in proportion to numbers the assessment is invalid.’

All these cases are undistinguishable in principle from the case now before us, and they are decisive against the plaintiff in error.

The question, what is a direct tax, is one exclusively in American jurisprudence. The text-writers of the country are in entire accord upon the subject.

Mr. Justice Story says all taxes are usually divided into two classes,-- those which are direct and those which are indirect,-- and that ‘under the former denomination are included taxes on land or real property, and, under the latter, taxes on consumption.’

Chancellor Kent, speaking of the case of Hylton v. United States, says: ‘The better opinion seemed to be that the direct taxes contemplated by the Constitution were only two; viz., a capitation or poll tax and a tax on land.’

We are not aware that any writer, since Hylton v. United States was decided, has expressed a view of the subject different from that of these authors.

Our conclusions are, that direct taxes, within the meaning of the Constitution, are only capitation taxes, as expressed in that instrument, and taxes on real estate; and that the tax of which the plaintiff in error complains is within the category of an excise or duty....

Judgment affirmed.

MR. JUSTICE BLACK WITH WHOM 

MR. JUSTICE DOUGLAS JOINS, CONCURRING.

The Court today holds that the right to trial by jury guaranteed defendants in criminal cases in federal courts by Art. III of the United States Constitution and by the Sixth Amendment is also guaranteed by the Fourteenth Amendment to defendants tried in state courts. With this holding I agree for reasons given by the Court. I also agree because of reasons given in my dissent in Adamson v. California. In that dissent, I took the position, contrary to the holding in Twining v. New Jersey, that the Fourteenth Amendment made all of the provisions of the Bill of Rights applicable to the States. This Court in Palko v. Connecticut, decided in 1937, . . .