Nate Silver/538-Warren's Wealth Tax Isn't The Slam Dunk Progressives Want It To Be

[Gothmog]

60. Unclear if Warren's Wealth Tax Proposal is Constitutional

The law is not clear here. https://taxfoundation.org/warren-wealth-tax-constitutionality/

Another issue is that a wealth tax may violate the U.S. Constitution, though legal opinions thus far are mixed. Our report did not analyze whether a wealth tax would be constitutional, and the short answer is that it’s unclear.

The Constitution prohibits federal direct taxes that are not apportioned by population, except for the income tax which is specifically permitted by the Sixteenth Amendment. I think every expert would agree on those points.

So the question is, what is and is not a direct tax? In one of the first U.S. Supreme Court cases, the Hylton case of 1796, they observed that a capitation, or head tax (flat rate on each person), would be a direct tax and thus unconstitutional if not apportioned. In the Pollock case of 1895, they came to a similar conclusion. That’s why the Sixteenth Amendment was adopted, to allow income taxes to be constitutional. An attempt to tax unrealized capital gains was struck down in the Macomber case of 1920.

This tax may be upheld but it would take years of litigation