The Lesson in Taxation, Part 7: Tax Law and The Revolution
W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…
There has been no other revolution that was more deeply rooted in taxation. Taxation didn't just cause it, but assisted in providing unity for the unorganized and squabbling colonies. However, probably not precisely the way you might imagine. If you're feeling the pressure with today's taxes, call a CPA for Tax Preparation in Raleigh, NC for all your tax-related needs!
First, the British taxes on the colonies were neither not fair nor oppressing on the people. Actually, Americans had a good life: we had the help of Britain, the land was fertile, business was good, and jobs were widely available. Europe's social castes did not limit the citizens and our sons were not conscripted to battle in wars in far-away lands… we had the good life. So why? Well, there were many missteps and misstatements by each side. Go here if you want help with a modern-day Tax Return in Raleigh, NC.
“Taxation without representation” was truly an issue. The problem was, no one knew quite what to do about it (after the American revolution, many colonies such as Canada and Australia found more productive solutions). But at the time there wasn't agreement by the British parliament or American leaders on what could be done to avoid “taxation without representation”. Ben Franklin, unknowingly I presume, complicated the issue. He went over to England as our liaison and told the British that internal taxes were bad but external taxes were OK.
By internal taxes, he meant the stamp tax and other taxes that were paid on transactions within the colonies themselves. External taxes, according to colonists’ definition, were taxes such as import taxes that were placed upon transactions that only in part took place in the colonies. They thought import taxes were external to the colonies. Yes, if you are confused about this, you ought to be. It makes almost no sense. Apparently no one caught on to the connection with import/export taxes and the final prices paid for the products. Essentially, import/export taxes affected the “other guy” so they were OK.
OK, said the British parliament. if that’s what you desire we will play along and give you whatever it takes to make you happy. So, the British enacted new tariffs, import and export taxes. Then, Americans changed their mind. They saw the flaw of their reasoning… but it was too late and the issue worsened.
Keep an eye out for W. Marc Gilfillan's next chapter in his History of Taxes series: Taxes and the Boston Tea Party.
http://www.marccpa.com/
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