The first attempt to impose an income tax on America occurred
during the War of 1812.
After more than two years of war, the federal government owed an
unbelievable $100 million of debt. To pay for this, the
government doubled the rates of its major source of revenue,
customs duties on imports, which obstructed trade and ended up
yielding less revenue than the previous lower rates.
And to think that the Revolution was started because of Tea
Taxes in Boston?
Excise taxes were imposed on goods and commodities, and housing,
slaves and land were taxed during the war.
After the war ended in 1816, these taxes were repealed and
instead high customs duties were passed to retire the
accumulated war debt.
What is Taxable Income? The amount of income used to arrive at
your income tax. Taxable income is your gross income minus all
your adjustments, deductions, and exemptions. Some specific
taxes: Estate Taxes: One of the oldest and most common forms of
taxation is the taxation of property held by an individual at
the time of death.
The US still has Estate Taxes, although there are proposals to
do away with them. Such a tax can take the form, among others,
of estate tax (a tax levied on the estate before any transfers).
An estate tax is a charge upon the deceased's entire estate,
regardless of how it is disbursed. An alternative form of death
tax is an inheritance tax (a tax levied on beneficiaries
receiving property from the estate). Taxes imposed upon death
provide incentive to transfer assets before death.
Canada no longer has Estate Taxes. Most European countries have
Estate Taxes, one prime example is Great Britain which has such
high Estate Taxes that it has just about ruined the financial
well-being of most of Britain's Nobility which has been forced
to sell vast Real Estate holdings over time.
Such a tax can take the form, among others, of estate tax (a tax
levied on the estate before any transfers).
An estate tax is a charge upon the decedent's entire estate,
regardless of how it is disbursed. An alternative form of death
tax is an inheritance tax (a tax levied on individuals receiving
property from the estate).
Taxes imposed upon death provide incentive to transfer assets
before death. Capital Gains Taxes Capital Gains are the
increases in value of anything (including investments or real
estate) that makes it worth more than the purchase price. The
gain may not be realized or taxed until the asset is sold.
Capital gains are normally taxed at a lower rate than regular
income to promote business or entrepreneurship during good and
bad economic times.
About the author:
Why there is an Income Tax
by Frank Vanderlugt
