In the case of Alexander Sprunt & Son, Inc. et al v. United States (1929), the U.S Supreme Court ruled in favor of the government, upholding a tax imposed on cotton exporters under Section 701(a) of Revenue Act 1918. The plaintiffs were cotton exporting companies who argued that this tax was unconstitutional as it violated their Fifth Amendment rights by depriving them of property without due process and equal protection laws. They also claimed that Congress exceeded its taxing power under Article I, Section 8 of Constitution by imposing an excise tax on exportation which is prohibited by Article I, Section 9 clause prohibiting taxes or duties on exports from any state. However, the court held that this was not an export duty but rather an income tax validly imposed upon profits derived from sales for export and thus within Congressional powers to levy taxes.

In the dissenting opinion for Alexander Sprunt & Son, Inc. v. United States, Justice Stone argued that the majority's decision to uphold a tax on cotton exports was inconsistent with previous court rulings and violated constitutional principles of taxation. He contended that the tax was not an excise but a direct tax because it targeted property rather than activities or privileges, thus requiring apportionment among states according to population as stipulated in Article I of the Constitution. Furthermore, he disagreed with the majority's interpretation of Flint v. Stone Tracy Co., asserting that this case did not establish a broad definition of excise taxes but instead emphasized their connection to privileges granted by government authority which were absent in this case involving private business transactions without any special benefits from federal law or policy.