1819. McCulloch V. State of Ma ryland. belonged to the United States, it would not, therefore, be exempted from the taxation of the States. To this purpose, the United States and the several States must be considered as sovereign and independent; and the principle is clear, that a sovereign putting his property within the territory and jurisdiction of another sovereign, and of course under his protection, submits it to the ordinary taxation of the State, and must contribute fairly to the wants of the revenue. In other words, the jurisdiction of the State extends over all its territory, and every thing within or upon it, with a few known exceptions. With a view to this principle, the constitution has provided for those cases in which it was deemed necessary and proper to give the United States jurisdiction within a State, in exclusion of the State authority; and even in these cases, it will be seen, it cannot be done without the assent of the State. For a seat of government, for forts, arsenals, dock-yards, &c. the assent of the State to surrender its jurisdiction is required; but the bank asks no consent, and is paramount to all State authority, to all the rights of territory, and demands of the public revenue. We have not been told, whether the banking houses of this corporation, and any other real estate it may acquire, for the accommodation of its affairs, are, also, of this privileged order of property. In principle, it must be the same; for the privilege, if it exists, belongs to the corporation, and must cover equally all its property. It is understood, that a case was lately decided by the Supreme Court of Pennsylvania, and from which no appeal has been taken, on the part of the United States to this Court, to show that United States' property, as such, has no exemption from State taxation. A fort, belonging to the federal government, near Pittsburgh, was sold by public auction; the usual auction duty was claimed, and the payment resisted, on the ground that none could be exacted from the United States. The Court decided otherwise. In admitting Louisiana into the Union, and so, it is believed, with all the new States, it is expressly stipulated, "that no taxes shall be imposed on lands, the property of the United States." There can, then, be no pretence, that bank property, even belonging to the United States, is, on that account, exonerated from State taxation. Third. If, then, neither the nature of the property, nor the interest the United States may have in the bank, will warrant the exemption claimed, is there any thing expressed in the constitution to limit and control the State right of taxation, as now contended for? We find but one limitation to this essential right, of which the States were naturally and justly most jealous. In the 10th section of the 1st article, it is declared, that "no State shall, without the consent of Congress, lay any imposts or duties, on imports or exports, except what may be absolutely necessary for executing its inspection laws." And there is a like prohibition to laying any duty of tonnage. Here, then, is the whole restriction, or limitation, attempted to be imposed by the constitution, on the power of the States to raise revenue, precisely in the same manner, from the same subjects, and to the same extent, that any sovereign and indepen 1819. McCulloch State of Ma V. ryland. 1819. M.Culloch V. State of Ma ryland. any dent State may do; and it never was understood by 1819. M'Culloch V. ryland. other bank." The author begins, No. 34, by saying, "I flatter myself it has been clearly shown, in my last number, that the particular States, under the proposed constitution, would have Co-EQUAL autho- State of Ma rity with the Union, in the article of revenue, except as to duties on imports." Under such assurances from those who made, who recommended, and carried, the constitution, and who were supposed best to understand it, was it received and adopted by the people of these United States; and now, after a lapse of nearly thirty years, they are to be informed that all this is a mistake, all these assurances are unwarranted, and that the Federal Government does possess most productive and important powers of taxation, neither on imports, exports, or tonnage, but strictly internal, which are prohibited to the States. The question then was, whether the United States should have any command of the internal revenue; the pretension now is, that they shall enjoy exclusively the best portion of it. The question was then quieted by the acknowledgment of a co-equal right; it is now to be put at rest by the prostration of the State power. The Federal Government is to hold a power by implication and ingenious inference from general words in the constitution, which it can hardly be believed would have been suffered in an express grant. If, then, the people were not deceived when they were told that, with the exceptions mentioned, the State right of taxation is sacred and inviolable; and it be also true a Letters of Publius, or The Federalist, Nos. 31–36. Voc. IV. 44. 1819. M'Culloch V. ryland. that the Bank of the United States cannot exist under the exercise of that right, the consequence ought to be, that the Bank must not exist; for if it can State of Ma- live only by the destruction of such a right-if it can live only by the exercise of a power which this Court solemnly declared to be a "violent assumption of power, unwarranted by any clause in the constitution"—we cannot hesitate to say, let it not live. But in truth this is not the state of the controversy. No such extremes are presented for our choice. We only require, that the bank shall not violate State rights, in establishing itself, or its branches; that it shall be submitted to the jurisdiction and laws of the State, in the same manner with other corporations and other property; and all this may be done without ruining the institution, or destroying its national uses. Its profits will be diminished by contributing to the revenue of the State; and this is the whole effect that ought, in a fair and liberal spirit of reasoning, to be anticipated. But, at all events, we show, on the part of the State, a clear, general, absolute, and unqualified right of taxation, (with the exception stated ;) and protest against such a right being made to yield to implications and obscure constructions of indefinite clauses in the constitution. Such a right must not be defeated by doubtful pretensions of power, or arguments of convenience or policy to the government; much less to a private corporation. It is not a little alarming to trace the progress of this argument. 1. The power to raise the bank is founded on no provision of the constitution that has the most distant allusion to such an |
