The 1st try to inflict an income tax on Americana occurred as a result of the War of 1812. At the end of two years of war, the federal government owed an astounding $100 million of debt (in inflationary terms, it probably had the same impact on the treasury as $100 billion debt would today). To pay for this, the government doubled the rates of its main source of revenue, customs duties on imports. This measure obstructed trade very severely that the government wound up bringing in much less revenue than it had received from the lower rates. It's ironic that the American Revolution was started because of Tea Taxes in Boston.
Additionally, excise taxes were imposed on goods, and commodities like housing, slaves and land were taxed pay for the war. After the war ended in 1816, these taxes were repealed and instead high customs duties were handed to retire the accumulated war debt.
What's Taxable Income? The amount of income utilized to arrive at your income tax. Taxable income is your gross income minus all of your adjustments, deductions, and exemptions.
A couple of specific taxes:
Estate Taxes: One of the oldest and widely-used forms of taxation is the taxation of property held by an individual at the time of demise.
The US currently has Estate Taxes, although there are proposals to do away with them. Such a tax can take 2 types of implemantation. A direct estate tax can be levied on the estate before any transfer to heirs. An estate tax is a charge upon the deceased's entire estate, regardless of how it's disbursed. One more choice form of death tax is an inheritance tax (a tax levied on beneficiaries obtaining property from the estate). Taxes imposed upon demise provide incentive to transfer assets prior to demise.
Canada no longer has Estate Taxes.
Virtually all European countries have Estate Taxes. The perfect example is Great Britain, where high estate taxes have proficiently ruined the financial well-being of practically all of Britain's Nobility, who've been forced to sell great real estate holdings or place them in historical trusts.
Capital Gains Taxes Capital Gains are the raises in value of anything (including investments or even real estate) that makes it worth more than the price for which it was purchased. The gains are most likely not to be realized or even taxed until the asset is sold.
Capital gains are ordinarily taxed at a reduced rate than regular income to increase business development or entrepreneurship throughout all economic phases. This is thought to help companies invest in technology and broaden to create more employment.
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