A History of Taxation, Part Seven: Tax Law and America's Revolution
W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…
No other revolution that was more deeply rooted in taxation. Taxation not only caused it, but assisted in providing unity for the unorganized and squabbling colonies. However, maybe not precisely the way you might imagine. 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!
First, the British taxation on the colonies were neither unfair nor oppressive. In fact, Americans had it great: we had the help of the British empire, our land was fertile, business was good, and jobs were widely available. Europe's social structures didn't limit the citizens and our sons were not forced to battle in wars in far-off places… we had it good. So what happened? Well, some missteps and misstatements by both sides. Go here if you want help with a modern-day Tax Return in Raleigh, NC.
“Taxation without representation” was indeed a problem. But nobody quite knew what to do about this problem (after the American revolution, other colonies such as Canada and Australia found more achievable solutions). But at this point in history there wasn't agreement by the British parliament or American leaders on what should happen to avoid “taxation without representation”. Ben Franklin, probably without his own knowledge I presume, made the issue worse. He took a boat over to England as our liaison and told the British that internal taxes were unacceptable but external taxes were OK.
By internal taxes, Franklin meant the paper tax and other taxes that were paid on transactions within the colonies themselves. External taxes, according to colonists’ definition, were taxes like import taxes that were on transactions that only partially took place in the colonies. The colonists believed import taxes were external to the colonies. Yes, if you’re confused about this, you ought to be. It makes almost no sense. Apparently no one caught on to the connection between import/export taxes and the ultimate prices paid for the products. Essentially, import/export taxes affected the “other guy” so they were OK.
OK, said the British parliament. if that is what you desire we’ll play along and give you whatever it takes to make you happy. So, the British created new tariffs, import and export taxes. Then, Americans changed their mind. They saw the folly of their reasoning… but it was too late and the issue got worse.
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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