Professors Dawn Johnsen, of Indiana University Maurer School of Law, and Walter Dellinger, of Duke Law School, argue essentially that the Pollock opinion has been discredited as a product of a highly conservative, libertarian court. They emphasize that it would make no functional sense whatsoever to require a wealth tax to be applied proportionally by state.
This is sensible, but unlikely to convince originalists, like the most conservative justices on the Supreme Court today.
Professor Bruce Ackerman, of Yale Law School, offers the more technical answer that in a 1900 case, the Supreme Court upheld an estate tax on the wealthy, partly rejecting the logic of the Pollock case. In his view, the 16th Amendment was meant to repudiate the Pollock decision even more thoroughly.
The problem with Ackerman’s argument is that on its face the 16th Amendment only allows an income tax. It’s silent on other forms of direct taxes.
In the landmark Affordable Care Act case in 2012, Chief Justice John Roberts briefly reviewed the history of the direct tax issue while upholding the individual health-insurance mandate as a legitimate tax within Congress’s power. But he didn’t show his hand with respect to the true meaning of “direct,” noting only that the court “continued to consider taxes on personal property to be direct taxes” as late as 1920, after the 16th Amendment was passed.
The bottom line for me is that we shouldn’t interpret “direct” too broadly, given the tainted nature of the provision and the spirit of the 16th Amendment. As Justice Oliver Wendell Holmes put it while dissenting in the 1920 case, “the known purpose of this Amendment was to get rid of nice questions as to what might be direct taxes.”
But the court’s conservative originalists would almost surely go the other way. The decision would likely come down to Roberts’s vote — like so many other unsettled questions in today’s constitutional law.
Noah Feldman is a Bloomberg Opinion columnist. He is a professor of law at Harvard University and was a clerk to U.S. Supreme Court Justice David Souter. His books include “The Three Lives of James Madison: Genius, Partisan, President.”