Bailey v. Drexel Furniture (1922)
The Drexel Furniture Company was a North Carolina Business. Congress had passed a child labor tax law in 1919, and Drexel Furniture was one of the businesses that employed children. To that end, the company was taxed roughly $6,000. It sued for a refund, and the case went to the Supreme Court. Chief Justice Taft presented the majority opinion, that the child labor tax law was a regulation on business, not an indirect tax as the United States had argued, and therefore was out of the boundaries of congressional authority. As a result, business regulation was set back a step, which was no small event in the 1920s when industry was growing faster than Government's willingness to control it.
The Drexel Furniture Company was a North Carolina Business. Congress had passed a child labor tax law in 1919, and Drexel Furniture was one of the businesses that employed children. To that end, the company was taxed roughly $6,000. It sued for a refund, and the case went to the Supreme Court. Chief Justice Taft presented the majority opinion, that the child labor tax law was a regulation on business, not an indirect tax as the United States had argued, and therefore was out of the boundaries of congressional authority. As a result, business regulation was set back a step, which was no small event in the 1920s when industry was growing faster than Government's willingness to control it.