The U.S. Supreme Court first issued its decision in Pollock on April 8, 1895, but split 4–4 on the question of whether a general income tax was constitutional. There were only eight justices participating because Justice Howell Jackson was afflicted with tuberculosis. After he recovered, the Court heard rearguments in early May and ruled 5–4 that the tax law was unconstitutional. The majority, in an opinion written by Chief Justice Fuller, reasoned that the law violated Article II, Section 9, of the Constitution, which provides: “No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.” The argument was that the tax was unconstitutional because it was a direct tax that must be apportioned to the states according to their population, instead of being applied generally and uniformly to all those across the country with incomes greater than $4,000.

Justice Henry Billings Brown and three others dissented. Brown wrote: “The decision involves nothing less than a surrender of the taxing power to the moneyed class. Even the spectre of socialism is conjured up to frighten Congress from laying taxes upon the people in proportion to their ability to pay them.”