A Brief Timeline of Taxation of the United States, Chapter One
W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…
Between 1868 until 1913, almost ninety percent of the federal government’s revenue was gotten from taxes on whiskey and tobacco. While the Civil War was occurring the government instituted a short income tax, but it was not until 1913 that the 16th Amendment was passed and enabled Congress to tax incomes “from whatever sources attained.” The initial 1040’s were due on March 1, 1914. No money was withheld from paychecks and no money was sent away with the return. Every taxpayer’s taxes were checked by IRS field agents and a bill mailed to the taxpayer on the first of June.
1766 – Colonial leaders got together to extinguish British taxes under the Stamp Act. The Stamp Act Congress, which it was named, was the beginning of the American independence movement and the birth of the modern U.S.
1782 – The first Congress under the Articles of Confederation formed. This Congress didn't have any powers of taxation.
1789 – America gave a new Congress taxing powers. Without taxing powers, the first Congress of the U.S. scantly survived seven years before being declared a failure; the second Congress, granted taxation powers, is currently going strong after almost 300 years. 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!
1792 – Alexander Hamilton persuades Congress to pass an excise tax on whiskey to increase earned income for the government and steady the increase in drinking. In the western frontier whiskey was the basic medium of exchange, and the twenty-five percent tax was a bit difficult to deal with. By 1794 the region was in open revolt. The forerunner of the Internal Revenue Service was spawned to give the tax enforcement. 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 increase the price on goods for Southern consumers and promote industrial monopolies in the North.
1850 – John C. Calhoun of South Carolina warns Congress that the South might secede from the Union due to the fact that the overly oppressive taxing in the South increased funds that ended up in the North, creating a great shift in money from the South to the North.
Stay tuned for Parts 2 and 3 of the Timeline of US Tax Policy!
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