McCray v. United States
**Overview of McCray v. United States**
McCray v. United States is a significant Supreme Court case addressing the scope of Congress's taxing powers, specifically concerning the regulation of oleomargarine production. The case originated when McCray was convicted for purchasing colored oleomargarine below the legal price, leading him to challenge the constitutionality of the federal law regulating this product. He argued that Congress had overstepped its authority by imposing an excise tax that infringed upon states' rights under the Tenth Amendment and violated his rights to due process and just compensation as outlined in the Fifth Amendment.
The Supreme Court, in a 6-3 decision, upheld Congress's ability to levy such a tax, asserting that it was within their "necessary and proper" powers as described in the Constitution. Justice Byron R. White emphasized that the federal government possessed broad taxing authority, which was not limited to revenue generation alone. The ruling highlighted the tension between federal and state powers while establishing a precedent regarding the interpretation of congressional authority in tax-related matters. Although the ruling faced restrictions in the 1920s, it was later reaffirmed in the 1930s, reflecting ongoing debates about the balance of power within the federal system.
McCray v. United States
Date: May 31, 1904
Citation: 195 U.S. 27
Issues: Taxing and spending clause; regulation of commerce
Significance: 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.
As with McCulloch 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, 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.