What funded the federal government before the income tax?

In 1913, Amendment XVI was ratified by the states, changing the constitutional funding of the federal government from taxes on goods and services to an individual income tax.

Learn the history behind the 16^th Amendment from The Constitution Annotated: Amdt16.2 Historical Background on Sixteenth Amendment

Before the income tax, taxes on imported goods funded our federal government while bolstering the domestic production of goods. I quote from Britannica: First term as president of Woodrow Wilson

“Wilson’s approach achieved spectacular results. He won his first victory with passage of the Underwood-Simmons Tariff (1913), which reduced duties on imports for the first time in 40 years. Accompanying the new tariff, to offset lost revenues, was an income tax, which was permitted under the recently adopted Sixteenth Amendment to the Constitution. Wilson’s second victory came when, after months of complicated debate and bargaining over banking and currency reform, Congress in 1913 passed the act creating the Federal Reserve System, which remains the most powerful government agency in economic affairs. A third victory came with passage of the Clayton Antitrust Act (1914), which strengthened existing laws against anticompetitive business actions and gave labour unions relief from court injunctions. Accompanying this act was the Federal Trade Commission Act of 1914, which created the Federal Trade Commission, a major agency overseeing business practices.“

In 1894, the U.S. Congress attempted to “tax incomes uniformly throughout the United States.”

The word uniformly means identical, the same, or consistent, as from example to example or place to place; constant; unvarying; undeviating.

The Federal Capitation Tax (aka Income Tax)

In the post-Civil War era, two amendments, the 13^th and the 14^th, served to equalize the benefits and privileges among all our people. Perhaps the most consequential and just clause is this: Amendment XIV, Section 1:
All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Remember this phrase: ‘the equal protection of the laws‘

The National Constitution Center: How we wound up with the income tax

The National Constitution Center reports the history of the individual income tax before 1913.

“The second income tax law was soon overturned by the Supreme Court in the 1895 decision of Pollock v. Farmers’ Loan & Trust. In a 5-4 decision, the court said the Income Tax Act of 1894 was an unconstitutional direct tax because it taxed interest, dividends, and rent in violation of Article 1, Section 2, which requires such taxes to be imposed in proportion to the states’ population.

“By the time President Taft took office in 1909, public outcry had grown over a tax system that undertaxed the rich and overtaxed the poor. In June 1909, Taft sent a letter to Congress during the debate in Congress over the Payne-Aldrich tariff to lobby for the 16th Amendment. He explained that part of the Pollock decision allowed the federal government to levy a corporate income tax as an excise tax. “The decision in the Pollock case left power in the National Government to levy an excise tax, which accomplishes the same purpose as a corporate income tax and is free from certain objections urged to the proposed income tax measure,” he said.

“The President then defined a basic two-tax system where income taxes were collected from citizens and businesses. He also understood that the amendment wouldn’t allow the Supreme Court to overturn a personal income tax based on the Pollock decision.”

My Opinion

The graduated income tax violates the equal protection clause of the 14^th Amendment. Therefore, the income tax is unconstitutional.

I propose we return to excise taxes on goods produced in the United States of America and taxation of imported goods. Such taxes inherently comply with the equal protection clause because the more significant the personal wealth, the greater the purchases by wealthy persons.

John White
Rockwall, Texas