In the case of Knowlton v. Moore in 1899, the United States Supreme Court upheld a federal inheritance tax law that imposed different rates based on the amount inherited and relationship to the deceased. The plaintiffs argued that this was an unconstitutional direct tax not apportioned among states according to population as required by Article I, Section 2 of the Constitution. However, Justice Edward Douglass White wrote for a majority of six justices that while some taxes on property were indeed "direct," an estate or inheritance tax was fundamentally different because it taxed not ownership but rather "the transmission from owner to owner." Therefore, such a tax did not need to be apportioned among states according to population. This decision helped establish precedent for progressive taxation in America.

In the dissenting opinion for Knowlton v. Moore, Justice Brewer argued that the federal inheritance tax was unconstitutional because it violated the uniformity clause of Article I, Section 8 of the Constitution. He contended that this clause requires all duties, imposts and excises to be uniform throughout the United States. According to him, a progressive tax rate is not uniform as it imposes different rates on different people based on their wealth status. Furthermore, he believed that an inheritance tax is essentially a direct tax which must be apportioned among states according to population under Article I Section 2 Clause 3 and Article I Section 9 Clause 4 of U.S Constitution; however in this case it was not done so. Thus he concluded that such taxation without proper apportionment violates constitutional principles.