A Short Timeline of Tax Practices of the USA, Part One
December 21, 2009 by Taxcut Editor
Filed under Personal and Business Taxes
W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…
From 1868 to 1913, about 90% of the national government’s revenue was gotten from taxes on alcohol and tobacco. While the Civil War was going on there was a brief income tax, but it was not until 1913 when the 16th Amendment permitted Congress to tax incomes “from whatever sources attained.” The initial 1040’s were due on March 1, 1914. No money was taken from paychecks and none was sent away with the return. Each taxpayer’s taxes were checked by IRS field agents and a bill mailed to the taxpayer on the first of June.
1766 – Colony leaders met to protest British taxes in place by the Stamp Act. This Stamp Act Congress, as it was named, was the beginning of the American independence movement and the origin of the modern U.S.
1782 – The first Congress under the Articles of Confederation formed. This Congress didn’t have any ability to tax the people.
1789 – Americans gave a new Congress taxing powers. Without taxing powers, the first Congress of the United States scantly survived 7 years before being declared a failure; the 2nd Congress, with taxing powers, is still functioning after almost 300 years. If you are feeling the pressure with today’s taxes, call a CPA for Tax Preparation in Raleigh, NC for all your tax-related needs!
1792 – Alexander Hamilton coerces Congress to pass an excise tax on whiskey to increase earned income for the government and steady the increase in alcohol consumption. In the western frontier whiskey was the basic mode of exchange, and the twenty-five percent tax was a bit difficult to deal with. By 1794 the area was in open revolt. The forerunner of the Internal Revenue Service was created to enforce the tax. Go here if you want help from a modern-day CPA firm in Raleigh, NC.
1832 – The national debt that remained after the Revolutionary War and the War of 1812 is finally accounted for and paid. The South doesn’t see any reason to continue high import taxes that raise prices for Southern consumers and promote industrial monopolies in the North.
1850 – John C. Calhoun of South Carolina warns Congress that the South could leave the Union due to the fact that the overly oppressive taxing of the South increased funds that ended up in the North, causing a great shift in wealth from the South to the North.
Stay tuned for Parts 2 and 3 of the Timeline of US Tax Policy!
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