The Supreme Court did not rule that all income taxes were direct taxes. Instead, the Court held that although generally income taxes are indirect taxes (excises) authorized by the United States Constitution in Article 1, Section 8, Clause 1, taxes on interest, dividends and rents in the 1894 Act had a profound effect on the underlying assets. The Court ruled that the tax on dividends, interest and rent should be viewed as a direct tax, as they fell on the property itself, rather than as an indirect tax. Direct taxes were required to follow the rule of apportionment found in Article 1, Section 2, Clause 3. The rule of apportionment requires the amount of a direct tax collected to be divided by the number of members in the United States House of Representatives, with the quotient then multiplied by the number of representatives each state has to determine each state's share of the tax that it then needs to lay and collect, through its own taxing authority.