The aim of these taxes was to shut down the federal bank" (Lockard, 131). James McCulloch, the cashier for the bank issued notes without paying the taxes that Maryland law required. Maryland state courts ruled against McCulloch. This led to the first case in the Supreme Court to settle a dispute between a national and a state law. .
"The main issues were whether the federal government had the power to charter a national bank, and does the state have the power to tax the bank" (McCulloch Vs. Maryland, p7). Chief Justice John Marshall stated "If the establishment of a national bank aided the government in the exercise of its granted enumerated Powers, then the authority to establish the bank would be an implied power The power to tax is the power to destroy States can not be permitted to destroy or impede the federal government or its agencies" (Lockard, 133). This is where the Necessary and Proper clause comes in. Marshall stated that the federal government could pass laws under its implied power, the Necessary and Proper clause, which do not violate specific rules stated in the Constitution. "The bank was a "necessary and proper" means to carry out the powers given to the federal government in the Constitution and Congress did have a right to charter the bank. Therefore, states cannot direct a tax espe!.
cially at the federal government. This case became the legal cornerstone of subsequent expansions of federal power" (Cushman, 43).
This case impacts any case that involves taxes. As previously stated, a state cannot tax directly at the federal government. However, the federal government is not immune to all the taxes. The Supreme Court originally barred all taxation of the federal government. "It later ruled that non-discriminatory state taxes would be permissible if (1) they are not a directed tax on the federal government or its property, (2) they do not impose an unreasonable burden on the federal government or its instrumentalists [Graves Vs.
