- The first income tax suggested in the United States was during the War of 1812 but is was never imposed.
- The first Federal income tax was adopted as part of the Revenue Act of 1861. The tax lapsed after the American Civil War. Subsequently enacted income taxes were held to be unconstitutional by the Supreme Court because they were not given to the states.
- In 1913, the Sixteenth Amendment was ratified, permitting the Federal government to levy an income tax without giving all of it to the states. It states:
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
- Federal taxes were expanded greatly during World War I, after the Wall Street crash of 29 and throughout the rest of the twentieth century.
- Federal income tax rates have been modified frequently. Tax rates were changed in 34 of the 97 years between 1913 and 2010.
Seems that there have always been severe reactions to taxes in this country. Many today do not want to see taxes raised on the wealthiest Americans. Some want to see the tax code greatly modified. Many want corporate taxes greatly lowered. Some advocate a tax on things purchased rather than a tax on income. It will be interesting to see if anything is done to our system of taxation.
What changes would you like to see in the way we are taxed?