Reference - Insurance

Reference - Insurance. Susan, a trained nurse, was recently elected to the U.S. Senate. Susan is very concerned about the lack of insurance for many children and also working adults who cannot afford the insurance premiums. She proposes legislation that states be taxed sufficiently to provide health insurance coverage to children and that federal funds for state highways be denied to any state that does not also provide insurance coverage for uninsured adults. She also proposed that states with citizens earning higher than average incomes be taxed at a higher rate than other states. Bill, a senator, tells Susan that Congress lacks the authority to tax in this manner because the U.S. Constitution expressly reserves that right to the states. Ellen, another senator, tells Susan that Congress has no authority to link highway funds or any other funds with social welfare objectives. Sam, an administrative assistant, tells Susan that Congress is prohibited from taxing residents of one state at a higher rate than citizens of another state. Which of the following is true regarding Sam's statement?

A) Sam is incorrect. The U.S. Congress has complete discretion on taxation.
B) Sam is incorrect, but before the U.S. Congress taxes one state's residents at a higher rate than citizens of other states, a compelling need must be shown.
C) Sam is incorrect, but before the U.S. Congress taxes one state's residents at a higher rate than citizens of other states, an important need must be shown.
D) Sam is incorrect, but before the U.S. Congress taxes one state's residents at a higher rate than citizens of other states, a disparity of income of over 30% must be shown.
E) Sam is correct.