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The Pamphlet Collection of Sir Robert Stout: Volume 51

A Tariff for Revenue "only" alone Constitutional

A Tariff for Revenue "only" alone Constitutional.

Q. Has the Supreme Court ever passed judgment upon the question whether the Government of the United States has the right to levy taxes for any other than public purposes, as for example, for the protection or promotion of private interests?

A. The city of Topeka, in Kansas, under an act of the Legislature of that State passed in 1872, voted to give, and with consent of a majority of its electors, did give £20,000 to an Iron Bridge Company, on condition that the latter established and operated their shops within the limits of the city. When an attempt was made to meet this expenditure by taxation, the power of this city, as well as of any political organisation in the United States—Municipal, State or Federal—to levy taxes for any such purpose as the encouragement of manufacturing enterprises was denied, and the question thus raised, was finally carried to the U.S. Supreme Court for adjudication. The Court, with but one dissenting opinion, absolutely and unqualifiedly decided the question in the negative, and incorporated in its decision the following statement : "To lay with one hand the power of the government on the property of the citizen, and with the other to bestow it upon favoured individuals to aid private enterprises and build up private fortunes, is none the less a robbery because it is done under the forms of law and is called taxation. This is not legislation, it is a decree under legislative forms. Nor is it taxation. Beyond a cavil, there can be no lawful tax which is not laid for public purposes."

Q. Does this decision deny the right of Congress or of the page 8 State Legislatures to levy and collect taxes for any other purpose than revenue?

A. It is clearly incapable of any other interpretation.

Q. Why then has not the "protective" system been abolished in the United States by applying this decision of its Supreme Court?

A. Because it is impossible to prove in respect to any particular tariff tax, that Congress had imposed it for "protection" rather than for revenue.