(federal income tax)
Tax protester Sixteenth Amendment arguments are assertions that the imposition of the U.S. federal income tax is illegal because the Sixteenth Amendment to the United States Constitution was never properly ratified, or that the amendment provides no power to tax income. Proper ratification of the Sixteenth Amendment is disputed by tax protesters who argue that the quoted text of the Amendment differed from the text proposed by Congress, or that Ohio was not a State during ratification. Sixteenth Amendment ratification arguments have been rejected in every court case where they have been raised and have been identified as legally frivolous.
Some protesters have argued that because the Sixteenth Amendment does not contain the words “repeal” or “repealed”, the Amendment is ineffective to change the law. Others argue that due to language in Stanton v. Baltic Mining Co., the income tax is an unconstitutional direct tax that should be apportioned (divided equally amongst the population of the various states). Several tax protesters assert that the Congress has no constitutional power to tax labor or income from labor,[3] citing a variety of court cases. These arguments include claims that the word “income” as used in the Sixteenth Amendment cannot be interpreted as applying to wages; that wages are not income because labor is exchanged for them; that taxing wages violates individuals’ right to property, and several others. Another argument raised is that because the federal income tax is progressive, the discriminations and inequalities created by the tax should render the tax unconstitutional under the 14th Amendment, which guarantees equal protection under the law. Such arguments have been ruled without merit under contemporary jurisprudence; evading taxes is a serious criminal offense.
The Sixteenth Amendment (Amendment XVI) to the United States Constitution allows the Congress to levy an income tax without apportioning it among the states or basing it on Census results. This amendment exempted income taxes from the constitutional requirements regarding direct taxes, after income taxes on rents, dividends, and interest were ruled to be direct taxes in Pollock v. Farmers’ Loan & Trust Co. (1895). It was ratified on February 3, 1913.
(to raise revenue to fund the civil war, congress introduced the income tax through the Revenue Act of 1861)
(it levied a flat tax of 3% on annual income above $800, which was equivalent to $19,490 in today’s money)
This act was replaced the following year with the Revenue Act of 1862, which levied a graduated tax of 3–5% on income above $600 (worth $13,156 today[8]) and specified a termination of income taxation in 1866.
The Socialist Labor Party advocated a graduated income tax in 1887. The Populist Party “demand[ed] a graduated income tax” in its 1892 platform.[10] The Democratic Party, led by William Jennings Bryan, advocated the income tax law passed in 1894,[11] and proposed an income tax in its 1908 platform.[12]
Prior to the Supreme Court’s decision in Pollock v. Farmers’ Loan & Trust Co., all income taxes had been considered to be indirect taxes and so were required to be imposed with geographical uniformity; as opposed to being direct taxes, which are required to be apportioned among the states according to population.
The Wilson–Gorman Tariff Act of 1894 attempted to impose a federal tax of 2% on incomes over $4,000 (worth $101,200 today).
(derided as “un-Democratic, inquisitorial, and wrong in principle,” it was challenged in federal court)