The United States brought a case against the City Bank of Columbus, alleging that it had failed to pay taxes on its profits from certain bonds. The bank argued that the tax was unconstitutional and should not be enforced. The Supreme Court ruled in favor of the United States, finding that Congress has broad authority to impose taxes and can do so even if those taxes are imposed on state-chartered banks like City Bank of Columbus. Furthermore, the court found that there is no constitutional prohibition preventing Congress from taxing income derived from investments such as bonds held by corporations or individuals. This ruling established an important precedent for federal taxation powers over state-chartered entities and affirmed Congress’s ability to levy taxes on investment income regardless of source or ownership structure.

In the case of The United States v. The City Bank of Columbus, the dissenting opinion argued that Congress had no authority to pass a law requiring state banks to pay taxes on their notes and bonds issued by them as part of their business operations. According to the dissenters, such taxation was unconstitutional because it violated both Article I Section 8 Clause 1 which grants Congress power “to lay and collect Taxes” only for purposes related to its enumerated powers in order “to provide for the common Defence and general Welfare”; as well as Article X Section 2 Clause 3 which states that “No State shall…pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts.” Furthermore, they argued that even if Congress did have such authority under these clauses then it would still be an unconstitutional exercise since taxing state bank notes would effectively amount to a taking without just compensation in violation of Amendment V's prohibition against private property being taken without due process. Ultimately, this dissent concluded that while there may be some valid reasons why Congress should tax state bank notes - including raising revenue - doing so through legislation rather than through constitutional amendment is not permissible under either federal or state laws.