297 U.S. 1, 56 S.Ct. 312, 80 L.Ed. 477 ( 1936)
In 1933 Congress attempted to benefit farm producers through the Agricultural Adjustment Act. The basic scheme adopted was the payment of various amounts to farmers in return for the farmers' promise to reduce crop acreage. A processing tax designed to finance the program of benefit payments was levied on the first processor of the commodity involved, and was to be measured by the difference between current average farm prices and the price prevailing in an earlier base period ( 1909-1914). Butler, the receiver for a processor, refused to pay the tax. The District Court ordered it paid, but the Circuit Court of Appeals reversed the order. The government appealed.
MR. JUSTICE ROBERTS delivered the opinion of the Court. . . .
It is inaccurate and misleading to speak of the exaction from processors prescribed by the challenged act as a tax, or to say that as a tax it is subject to no infirmity. A tax, in the general understanding of the term, and as used in the Constitution, signifies an exaction for the support of the government. The word has never been thought to connote the expropriation of money from one group for the benefit of another. We may concede that the latter sort of imposition is constitutional when imposed to effectuate regulation of a matter in which both groups are interested and in respect of which there is a power of legislative regulation. But manifestly no justification for it can be found unless as an integral part of such regulation. The exaction cannot be wrested out of its setting, denominated an excise for raising revenue and legalized by ignoring its purpose as a mere instrumentality for bringing about a desired end. To do this would be to shut our eyes to what all others than we can see and understand. Child Labor Tax Case [ Bailey v. Drexel Furniture Co.] . . . .
We conclude that the act is one regulating agricultural production; that the tax is a mere incident of such regulation; and that the respondents have standing to challenge the legality of the exaction.
It does not follow that as the act is not an exertion of the taxing power and the exaction not a true tax, the statute is void or the exaction uncollectible. For, to paraphrase what was said in the Head Money Cases, 112 U.S. 580, if this is an expedient regulation by Congress, of a subject within one of its granted powers, "and the end to be attained is one falling within that power, the act is not void, because, within a loose and more extended sense than was used in the Constitution," the exaction is called a tax.
The Government asserts that even if the respondents may question the propriety of the appropriation embodied in the statute, their attack must fail because Article 1, §8 of the Constitution, authorizes the contemplated expenditure of the funds raised by the tax. This contention presents the great and the controlling question in the case. We approach its decision with a sense of our