Revolutionary War-Era Sequestration: New Taxes, War-Time Debts, Commutation and the Newburgh Conspiracy

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Focus On: Revolutionary War

 

Revolutionary War-Era Sequestration: New Taxes, War-Time Debts, Commutation and the Newburgh Conspiracy

 

By: Woody Holton | March14, 2013

Tags: Revolutionary War

 

Most descriptions of the road to the Constitution draw attention to the same mileposts. The federal convention mustered a quorum on May 25, 1787, and completed its work four months later, on September 17. Delaware became the first state to ratify, on December 7, 1787. And so on. Inevitably these timelines omit one of the Constitution’s most pivotal red-letter dates.

 

On September 27, 1785, Congress sent the thirteen state legislatures a bill for $3 million.

 

This “requisition” set off several initially distinct chains of events that, upon merging, immeasurably intensified the momentum for the Constitution.

 

There was nothing new about Congress’s placing huge demands on the states. It had done that throughout the Revolutionary War. Back then, though, paymasters and purchasing agents working for the British and French armies had scattered gold and silver through the countryside, making taxes much easier to pay. Moreover, Americans could discharge many of their wartime taxes using paper money that had depreciated to a fraction of its face value.

 

Congress had no power to enforce its demands, so the state legislatures could simply have ignored the 1785 requisition. But most made good-faith efforts to fill their quotas—with dire consequences. http://www.commandposts.com/2013/03/revolutionary-war-era-sequestration-new-taxes-war-time-debts-commutation-and-the-newburgh-consiracy/

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Focus On: Civil War

 

Income Tax To Pay War Bond Interest

 

By: George S. McGovernDate:August5 , 2011

 

More significantly, the Internal Revenue Act of 1861, the first federal income tax in American history, assured the financial community that the government would have a reliable source of income to pay the interest on war bonds. Subsequent Revenue Acts of 1862 and 1864 created moderately progressive tax brackets and set rates at 5, 7.5, and 10 percent. By the end of the war nearly one in ten American house holds (mostly in the affluent states in the industrial Northeast, the section of the country that held most of the wealth) paid an income tax.

Also enacted was an excise tax system that imposed taxes on almost everything: liquor, professional licenses, carriages, yachts, medicines, corporations, stamps, and

 

Read the content of the Internal Revenue Act of 1861 via the Library of Congress. http://www.commandposts.com/2011/08/income-tax-to-pay-war-bond-interest/