In the case of Aspinwall v. Butler, the Supreme Court of the United States ruled that a state could not tax the income of a non-resident who earned income in the state. The case was brought by a resident of New York, Aspinwall, who had earned income in the state of Pennsylvania. Aspinwall argued that the Pennsylvania tax was unconstitutional because it violated the Due Process Clause of the Fourteenth Amendment. The Supreme Court agreed with Aspinwall, ruling that the Pennsylvania tax was unconstitutional. The Court held that the Due Process Clause of the Fourteenth Amendment prohibited a state from taxing the income of a non-resident who earned income in the state. The Court reasoned that the tax was an unreasonable burden on interstate commerce and violated the right of a non-resident to be free from taxation without representation. The decision in Aspinwall v. Butler was an important one in the development of the law of taxation. It established the principle that a state cannot tax the income of a non-resident who earned income in the state. This principle has been applied in numerous cases since then, and it remains an important part of the law of taxation today.

In the dissenting opinion of Aspinwall v. Butler, Justice Field argued that the majority’s decision was a violation of Article I, Section 10 of the Constitution which states that no state shall pass any law impairing contracts. In this case, New York had passed a statute allowing for debtors to pay their creditors in installments over time rather than all at once as originally agreed upon in contract form. The majority held that this did not violate Article I because it only applied prospectively and thus did not affect existing contracts; however, Justice Field disagreed with this interpretation and argued instead that even if it were prospective legislation it still violated Article I by changing the terms of an already existing contract without consent from both parties involved. He further noted how such laws could be abused by debtors who would take advantage of them to avoid paying what they owed while creditors would have little recourse against them since they could not legally collect more than what was allowed under these new statutes. Ultimately he concluded his dissent by stating “The power assumed is one which has been uniformly denied to Congress and State legislatures alike…and should be resisted whenever attempted”