If we believed what Mitt Romney said in the 2012 campaign, that only 47 percent of Americans pay federal taxes, then nearly half of us have just written big checks to the U.S. Treasury (more like the U.S. Treachery), so it’s a good time to look at the income tax and how we got here.
According to Adam Young, writing for the Mises Institute, the Revolutionary War fought in the name of the inherent natural rights to life, liberty and the pursuit of happiness promised to enthrone the gains of individualism. Instead, today federal taxation causes individuals to serve the interest of ever-greater submission to the centralized state and has made reluctant bookkeepers of us all. How did this happen and so soon after winning our freedom in 1776?
It happened the very same way it happens today. The government spends more money than it takes in. And by the way, a balanced budget amendment will not help unless there are also stringent spending caps included, otherwise they’ll just keep raising taxes and never reduce the deficit.
In the beginning taxes were to pay for wars this nation incurred fighting the British. From deep debts incurred by the War of 1812, the first income tax proposal was born. They raised revenue in many ways such as taxes on land and slaves, excise taxes, taxes on goods and commodities — and thankfully, when the war ended these taxes were repealed. Instead, a high tariff was passed to retire the war debt and this temporarily defeated the income tax idea. But the seed had been planted, only to germinate again when struggling to fund the Union armies, hoping to stave off secession of the Confederacy.
We would laugh today at the initial taxes imposed in 1861 by President Lincoln under the Revenue Act. Only net income in excess of $600 a year was to be taxed and at a rate of only 3 percent.
But even before the first tax was due the government’s thirst for revenue created our progressive tax system ensuring higher-income earners would pay more. Under this scheme, the 3 percent rate would apply only to incomes between $600 to $10,000 and a higher 5 percent rate was imposed on income between $10,001 – $50,000. Not surprisingly, rates were raised again and again until today, at this time of year, millions of Americans stay up late, searching for deductions, breaking pencils in frustration, double checking the math and pulling their hair out as they complete their federal income tax returns.
The Founders rejected income taxes — or any direct taxation, unless apportioned to each state by population, as laid out in Article 1, Section 9 of the Constitution. But Democratic platforms and the progressive wing of the Republican Party continued to clamor for an income tax and introduced such a provision in 1909 attached to a tariff bill. It is said that the conservatives plan to end the income tax for good backfired on them.
In 1909 they proposed an amendment to the Constitution for an income tax because they never believed the required 3/4s of the states would ratify it. They were wrong, as state after state approved it until the 16th Amendment was ratified in 1913, giving the federal government the power to lay and collect taxes on individuals and corporations. Today, the passage of the income tax is often associated with the growth in government spending. Its biggest effect has been to shift the balance of power toward the federal government, away from the states.
Here’s an idea. Why not change the tax deadline to sometime in November, say maybe around the first Tuesday when there’s a lot of voting going on. Do you think anything would change?
As citizens of a free republic it is our duty to preserve it. If you would like to take a free online course on the U. S. Constitution go to: www.freeconstitutioncourse.com.
Mikie Kerr is a constitutional enthusiast who lives in Waikoloa and writes a monthly opinion column for West Hawaii Today.