• Last updated on November 11, 2022

The Supreme Court established that the federal tax power could be used to regulate commerce.

Congress had passed a law to regulate the production of oleomargarine. Defendant McCray, convicted for buying colored oleomargarine at a lower than legal price, claimed that Congress had exceeded its proper power to tax for revenue purposes. McCray maintained that the law violated the Tenth Amendment, which gave the states the right to tax on those matters not within the proper scope of the federal government, as well as his rights to due process and just compensation for an improper taking under the Fifth Amendment.Taxing and spending clause;McCray v. United States[MacCray v. United States]Commerce, regulation of;McCray v. United States[MacCray v. United States]

One of the dissenters in McCray, Melville W. Fuller left a small legal legacy to the Supreme Court, although he served as chief justice for twenty-two years.

(Collection of the Supreme Court of the United States)

As with McCulloch v. Maryland[case]McCulloch v. Maryland[MacCulloch v. Maryland] (1819), the question was which level of government had the power to take the action. The Supreme Court, by a 6-3 vote, ruled against McCray. Following McCulloch, Justice Byron R. White,White, Byron R.;McCray v. United States[MacCray v. United States] in his opinion for the Court, noted there was no explicit ban on Congress levying an excise tax, and therefore, it could be “necessary and proper” within the meaning of Article I, section 8, of the Constitution. White, while reserving the Court’s power to look into abuses, found Congress had a broad taxing power beyond mere revenue generation. With this conclusion, there would be no proper objections from the states under the Tenth Amendment and no proper individual objections under the Fifth Amendment. This ruling was restricted somewhat in the 1920’s but restored in the 1930’s. Chief Justice Melville W. Fuller and Justices Henry B. Brown and Wheeler H. Peckham dissented.

Commerce, regulation of

Federalism

McCulloch v. Maryland

Taxing and spending clause

Categories: History Content