Welcome To              TaxHistory.com
Historical Perspectives on the Federal Income Tax

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Cover Page
Table Of Contents


There is only one express exception to Federal taxing power found in the United States Constitution. Article I, Section 9 provides "No tax or duty shall be laid on articles exported from any State."

The Constitution divides all taxes into two classifications; direct taxes and indirect taxes. Direct taxes must be levied according to the rule of apportionment and indirect taxes must be levied according to the rule of uniformity.

It is important to note and emphasize that these are classifications for purposes of how taxes may be levied, not denials of taxing power. The Federal government may enact direct taxes, but if it does so, they must be apportioned among the States.

The classification of direct taxes and the rule of apportionment are set forth in Article I, Section 9, Clause 4 of the Constitution, which states:

No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census of Enumeration herein before directed to be taken.

There are two types of direct taxes that therefore have to be apportioned: taxes on property (real or personal) and "Capitation” taxes (head taxes).  Congress has in the past levied taxes on property. In 1813, Congress levied a direct tax on property totaling three million dollars, which the statute apportioned among the eighteen states and then among the counties (parishes) of each State.1  Thus, for example, $369,018.44 was apportioned to Virginia and $6,364.60 of that amount apportioned to Fairfax County. Provisions for assessing and collecting the tax were contained in the Act of July 22, 1813.2  A direct tax on property totaling $20 million was levied in 1861, apportioned


among the States, territories, and the District of Columbia.3 Congress has never enacted a “head tax”.

The classification of indirect taxes and the rule of uniformity are set forth In Article 1, Section 8, Clause 1 of the Constitution, which states:

The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States.

All taxes, which are not direct, are indirect and subject to the rule of uniformity. The rule of uniformity requires that an indirect tax not discriminate geographically.4 For example, it would violate the rule of uniformity to enact a special income tax rate for residents of the State of Texas; however, it does not violate the rule to have a special income tax rate for individuals who make over $50,000 per year.

1       Act of August 2,1813, 2 Stat. 53.

2       3 Stat. 22 (1813).

3          Act of August 6, 1861, $ 8, 12 Stat. 295. 

For questions about the material on this site or for problems concerning the mechanics of this site contact info@taxhistory.com
Like the new site? Let us know! Don't like it Let us know that too