CHAPTER VIII.

THE POWERS OF CONGRESS.

§ 136. Powers of Congress in General.-The government of the United States is one of delegated powers,1 it rests upon the Constitution of the United States, and has only such powers as are therein granted to it. The grants of powers to Congress, the legislative department of the government (except the grant of powers to govern territory belonging to the United States but outside of the limits of the United States itself), are contained in the eighth section of the first article of the Constitution. The powers thus granted are given only in their rough outline; the Constitution enumerates these powers but does not define them. The powers granted by the Constitution to Congress are the maximum which it can exercise. Congress is not compelled to use all the powers granted to it; it may entirely disregard certain of these powers, or may exercise them only in part. When Congress fails to legislate on any subject over which they have been given jurisdiction but which has not been expressly denied to the States, then the States may legislate on the subject. It is not required that a power be expressly granted to Congress, it is sufficient if it be granted to it by implication.2

The eighth section of the first article contains eighteen clauses, each containing the grant of certain powers to Congress. These eighteen clauses will be taken up in order.

§ 137. The Power of Taxation.-Clause 1: "The Congress shall have power to lay and collect taxes, duties, imposts, and excises; to pay the debts and provide for the common defense and general welfare of the United States; but all duties, im

'See Chapter I., ante.
2
" McCulloch

V. Maryland, 4

Wheaton, 316.

posts, and excises, shall be uniform throughout the United States."

The power of taxation granted to the United States is not exclusive; the power to tax still remains with the States subject to the restrictions contained in the Constitution, including the implied restriction not to lay any tax which will in any way interfere with the operation of the Federal Government.3

Taxation is an incident of sovereignty, and essential to the very existence of any government. The inability of the United States government to lay and collect taxes under the Articles of Confederation, except through the agency of the States, was the most vital of the many defects in that system of government. The Supreme Court has said, in speaking of this general subject of taxation, that: "Taxation is a sacred right, essential to the existence of government; an incident of sovereignty."

The taxing power is co-extensive with sovereignty," and the power of the United States to tax is co-extensive with its territorial limits. Such power is unlimited as to its extent, in those cases where the right exists, and may be exercised to its utmost extent. 8

It is within the power of Congress to select the objects upon which a tax shall be laid. In exerting this power no want of due process of law can result, and the Fifth Amendment to the Constitution does not apply. The general presumption in favor of the validity of an Act of Congress is particularly strong in favor of any revenue law.10 All means which are necessary to

'Van Allen v. the Assessors, 3 Wallace, 573, 585; Bradley v. People of Illinois, 4 Wallace, 459, 462; McCulloch v. Maryland, 4 Wheaton, 316; Osborn v. Bank of United States, 9 Wheaton, 738; Weston v. City of Charleston, 2 Peters, 449; Dobbins v. Erie County Commissioners, 16 Peters, 435, 455. See Chapter V., ante.

4 Dobbins v. the Erie County Commissioners, 16 Peters, 435, 447.

be exercised for the legitimate purpose of levying taxes and collecting the same, may be employed to that end.11

Such being the right of taxation, it is now necessary to consider what are taxes. "A tax is understood to be a charge, a pecuniary burden, for the support of Government."2 "Taxes proper, or general taxes, proceed upon the theory that the existence of Government is a necessity; that it cannot continue without means to pay its expenses; that for these means it has the right to compel all citizens and property within its limits to contribute; and that for such contribution it renders no return of special benefit to any property, but only secures to the citizen that general benefit which results from protection to his person and property and the promotion of those various schemes which have for their object the welfare of all. The public revenues are a portion that each subject gives of his property in order to secure or enjoy the remainder.”13 A tax is to be distinguished from a toll; a tax is a demand of sovereignty, while a toll is a demand of proprietorship.1

18

16

17

Among the proper subjects of taxation by the United States Government are manufactories, banks, 18 occupations, railroads,18 and express companies.1

19

Congress has power to impose a license duty on those who are engaged in a business which is a subject of police regulation by the State, as in the case of imposing a license for carrying on the business of a retailer in liquors.20 But a license to carry on a particular business under an Act of Congress conveys to

11 United States v. 288 Packages of Merry World Tobacco, 103 Fed. Rep. 455.

12 United States v. Baltimore & Ohio R. R. Co., 17 Wallace, 322,

326.

13 Illinois Central R. R. Co. v. Decatur, 147 U. S. 190, 198.

"Case of State Freight Tax, 15 Wallace, 232; St. Louis v. Western Union Tel. Co., 148 U. S. 92, 97. 15 United States v. Singer, 15 Wallace, 111.

16 Bank for Saving v. Collector, 3 Wallace, 495; Central National Bank v. United States, 137 U. S. 335, 355.

17 Pacific Insurance Company v. Soule, 7 Wallace, 433, 445; United States v. Cutting, 3 Wallace, 441, 443.

18 Little Miami, etc., R. R. v. United States, 108 U. S. 277.

19 Petzer v. Wood, 109 U. S. 183. 20 United States V. Riley, 5 Blatchf. 204, 27 Fed. Cas. 16, 164.

the licensee no authority to carry on the licensed business within a State.21

§ 138. Restrictions Upon the Power of Taxation. The Constitution places three restrictions on the general power of taxation granted to the United States Government, as follows:

"But all duties, imposts, and excises, shall be uniform throughout the United States."

"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."

The first two restrictions are taken up together in the next section.

The prohibition against export duties was inserted into the Constitution as a part of the third great compromise in the Constitutional Convention and was a concession to the South. This prohibition of any duties on export is absolute; but the proper fees accruing in the due administration of the laws and regulations necessary to be observed to protect the government from imposition and fraud likely to be committed under pretense of exportation are in no sense a duty of exportation, nor is the charge for stamps required to be placed on packages of manufactured tobacco intended for exportation a duty of exports within the meaning of this prohibition.22 This prohibition does not prohibit export duties in the colonies of the United States.

Taxes can only be laid and collected for the purposes of paying the debts and providing for the common defense and general welfare of the United States. It therefore follows that all appropriations of money for other purposes are invalid. Under this principle, the Act of Congress authorizing the issue of licenses to produce sugar, and for the payment of a bounty to the producers of sugar from beets, sorghum, or sugar cane - grown in the United States, or from maple sap produced within the United States, was held to be unconstitutional, as such boun

21 License Tax Cases, 5 Wallace, 462, 480; Pervear V. Commonwealth, 5 Wallace, 475, 478.

22 Pace v. Burgess, 92 U. S. 372; Turpin v. Burgess, 117 U. S. 504. See also Sec. 172.