Judicial Review of Congressional Power to Tax under U.S. Constitution: Tensions between Framers’ Intent and Imperatives of Reality

Abstract

This paper discusses authority granted to Congress over imposing federal taxes in general, and income tax in specific. The author used the critical analytical method to analyze the rulings of the U.S. Supreme Court, the U.S. Income Tax Law, and the U.S. Constitution, to reach the policy followed by the court in ruling on the constitutionality of legal provisions related to the constitutionality of such tax legislations. The importance of this article comes in that it is one of the few studies that analyzed and criticized the policy of the U.S. Supreme Court in its ruling on the constitutionality of tax federal legislations. The author explains the role of the U.S. Supreme Court in identifying what is considered as income in some gray areas that the U.S. tax code (26 U.S. Code of 1986) did not provide an answer for, or petitioners claimed that such income does not fall in gross income inclusions. In addition, the author explains the philosophy behind granting Congress such power, and the effects of such authority. Although the author believes that many amendments to the tax code has political backgrounds rather than economic, granting this power to Congress would be less arbitrary compared to the political scenarios that could appear if it granted to the Executive Branch. At last, the author discusses the constitutional limits on congressional power of taxing and how these limits would affect tax legislations that Congress was trying to pass, considering people’s right of equity in tax treatment under Uniformity Clause.

Keywords

• Separation of Powers
• Taxing Power
• Taxation Clauses
• Taxable Income
• Checks and Balances