Restricting Legislative Power to Tax in the United States

Abstract

The Government’s authority to impose taxes is one of its most pervasive and fundamental powers. In the United States, this power is granted to Congress by the U.S. Constitution with few explicit restrictions. Moreover, the courts in the United States almost invariably affirm the Government’s power to tax in the face of constitutional challenges.3 This “presumption of constitutionality” afforded most tax legislation is a long-standing and well-accepted proposition. As a result, constitutional law has played a relatively minor role in the development of tax laws in the United States.

While many questions arise from the intersection between constitutional law and federal and state taxing power, most are not answered by the litigated cases. Our goal is not to raise possible constitutional claims, but instead to provide an overview of how courts in the United States have applied constitutional limitations to federal and state taxing power so that others may make relevant comparisons with tax systems in other countries. Space limitations require selective treatment of the subject rather than a comprehensive analysis..