US Enacts War Revenue Act
Oct. 10th, 2017 12:01 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
dragonlady7via http://ift.tt/2grJXtK:
today-in-wwi:
October 3 1917, Washington–In addition to raising money through the the Liberty Loans, the US government also increased tax rates. The income tax was relatively new as a standard part of the tax code, as the 16th Amendment permitting it was only ratified in 1913–although there had been an income tax briefly during and just after the Civil War. On October 3, President Wilson signed the War Revenue Act, which doubled the standard income tax rate (from 2% to 4%), and greatly increased the marginal rates for higher-income earners, up to 67% for the very highest rate. The standard exemption was also lowered, meaning that more Americans would be paying taxes.
Nevertheless, the exemptions were still quite generous ($2000 for married filers, corresponding to around $36,000 in 2017) meant that the vast majority of Americans did not pay income tax. Nevertheless, the US government was able to full one third of the cost of the war with a tax paid by only 5% of Americans. Similarly, the top brackets only applied to extremely high incomes; the top rate applied to incomes of over $2 million ($36 million today), and rates were still below 50% for incomes below $300,000 ($5.5 million today).
Today in 1916: Germans Decree Forced Labor in Belgium and PolandToday in 1915: Russia Issues Ultimatum to BulgariaToday in 1914: First Canadian Troop Convoy Departs for Europe
today-in-wwi:
October 3 1917, Washington–In addition to raising money through the the Liberty Loans, the US government also increased tax rates. The income tax was relatively new as a standard part of the tax code, as the 16th Amendment permitting it was only ratified in 1913–although there had been an income tax briefly during and just after the Civil War. On October 3, President Wilson signed the War Revenue Act, which doubled the standard income tax rate (from 2% to 4%), and greatly increased the marginal rates for higher-income earners, up to 67% for the very highest rate. The standard exemption was also lowered, meaning that more Americans would be paying taxes.
Nevertheless, the exemptions were still quite generous ($2000 for married filers, corresponding to around $36,000 in 2017) meant that the vast majority of Americans did not pay income tax. Nevertheless, the US government was able to full one third of the cost of the war with a tax paid by only 5% of Americans. Similarly, the top brackets only applied to extremely high incomes; the top rate applied to incomes of over $2 million ($36 million today), and rates were still below 50% for incomes below $300,000 ($5.5 million today).
Today in 1916: Germans Decree Forced Labor in Belgium and PolandToday in 1915: Russia Issues Ultimatum to BulgariaToday in 1914: First Canadian Troop Convoy Departs for Europe
