Essay on Communications

3104 Words Oct 7th, 2013 13 Pages
Introduction
Developing an alternative economically feasible tax collecting system which is fair and balanced to both businesses and citizens of the United States. The United States currently uses a progressive tax system, which is dependent on two important factors: income, which is a key component of the progressive taxation, depending on income of an individual. The tax rate increases for higher income earners and decreases for lower income earners. The other major factor in the progressive taxation system is expenditures. Expenditures are various sales takes that impose or collect revenue. The concept of expenditures is the more you spend, the more taxes you will pay thus increasing revenue within the progressive taxation system.
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In 1794 a rebellion erupted in Pennsylvania due to the whiskey tax where federal groups were sent by Washington to quall the rebellion, defending the power of congress to collect direct taxes. Benjamin Franklin was quoted as saying “in this world, nothing can be said to be certain, expect death and taxes.” The ability of the United States to collect taxes is paramount, during the civil war congress was pressed into action by passing the Revenue Act of 1861 which levied an income tax on income greater than $800 but the act was rescinded in 1872. This act was credited with what we considered the modern tax system today. The system entailed the creation of an internal revenue collection, the tax was progressive and some deductions were allowed. Because of the tax system that used tariffs and duties, it began to have an adverse affect on world trade and living standards of the poor, something needed to be done. In an effort to collect revenue using a different method, congress passed the 16th Amendment which removed a provisional clause for bidding the collection of direct taxes.
In the advent of World War 1 & 2, various revenue acts were created, ratcheting up tax rates and lowering deductions. The tax rates bloomed over the years to over 76% for high income earners. It was only in 1981 the Economic Recovery Act was passed, which basically turned the tide on taxation, lowering the tax bracket by 25% and the corporate rate to 35%. The

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