(Quote) Jim-826315 said:
I stand corrected. The Sixteenth Amendment was ratified in 1913, but there was an income tax in 186...
(Quote) Jim-826315 said:
I stand corrected. The Sixteenth Amendment was ratified in 1913, but there was an income tax in 1862. Now I remember Michael Reagan mentioning the "Yankee, Republican and unconstitutional" tax.
The XVI Amendment gave Congress no new taxing power. It always had the power to tax incomes under Article I Section 8 of the Constitution.
The income tax had an off and on existence after the Civil War.
In 1894 the Wilson - Gorman Tariff Act levied a 2% tax on income in excess of $4,000. This act was challenged in Court in the Pollock case (Pollock vs Farmers Loan and Trust) on the basis that it was a direct tax that under the Constitution had to be an apportioned per the requirements of Article I Sec. 8 dealing with direct taxes.
The case made its way to the Supreme Court. The Court Held, contrary to all other court ruling preceding it and contrary to all prior legal understanding of direct taxes that in so far as the 1894 Act levied a tax an property and income derived from property it was unconstitutional because it did not properly apportion the tax as required. It further held that the tax was Constitutional on income derived from all other sources; i.e. wages and salary. and finally it held that since it was Congresses intent to tax all income in essence it would be unfair to hold only part of the Act Unconstitutional and allowing the full burden of the tax to fall solely on that income that it found to be Constitutional, it thereforef declared the entire law to be unconstitutional.
Prior to that decision all forms of income taxes were considered to be indirect taxes. Direct taxes were understood to mean taxes directly levied on property, ad valorum taxes, Capitation taxes and their ilk.
After that decision, agitation continued to enact an income tax. That presuure came mainly from the far left in those days, specifically from the Socialists of the day.
Legal scholars then and now believe the Court's decision in the Pollock case was incorrect and poorly conceived and supported. Nevertheless, it stood and something had to be done about it. As it stood, any tax on income such as rents, any investment income, interest, dividends had to be apportioned. While taxes on wages and salary could be levied with no restrictions except the political repercussions at the ballot box.
The answer was the XVI Amendment which did nothing more than render, by definition of the Amendment, a tax on income from whatever source derived to be an indirect tax.
As later cases decided by the Supreme Court state, that the XVI gave Congress no new powers of taxation and merely placed all taxes on income from whatever source derived in their proper category of ing direct taxes not requiring apportionment.
That is why factions calling for a Constitutional amendment to repeal the XVI would have no effect on Congress' powers to levy an income tax. And if it did go ahead and was challenged based on the Pollock case, it would survive the challenge since the Courts today would not follow the Pollock precedence.