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Historical Perspectives on the Federal Income Tax

     This site is dedicated to resolving tax issues through education and the political process.  The purpose of this site is to circulate a "PETITION FOR REDRESS OF GRIEVANCE" regarding the inadequency of the "Personal Exemption", as provided for under Subsection 151 of the Internal Revenue Code.  The information provided within this site is taken from the Congressional Record of 1909-1913 and 1934-1944, and 1954. The Statistical Abstract of the United Stated 1918-1998, Supreme Court Cases, Federal Government web-sites and other documentation provided by government sources.  This is not a tax protest.  Our argument and complaint is that the "Personal Exemption" no longer represents a fair and adequate living, thereby making the "Income Tax" a direct tax upon life, not upon "Income".

     Our arguments are based upon the following quotation taken from page 5679 of  the Congressional Record of October 16, 1913.  The author, "Judge" Hull, wrote the first "Income Tax" measure under the 16th Amendment and in his synopsis of the Revenue Act of 1913 he gave us this information:

"The statutory exemption of $3,000 is allowed for personal living or family expenses; however, this and other gross income for which special deductions are allowed by the law must be embraced in the return of gross income, and the commissioner of Internal Revenue will make these deductions when he assesses and computes the tax."

This statement has never been changed nor repealed, in fact, the Constitutional Amendment upon which it is based would prohibit the "Personal Exemption" from accomplishing anything less.  Well at least until 1944. These changes are explained in detail here.

    What happened between 1940 and 1944?

      To put this in perspective, in 1929 the personal exemption was equal to twice the per-capita consumption expenses (personal living and family expenses) as reported by the Statistical Abstract.  Today, it is worth less than 10% of those expenses.   In 1913 the personal exemption was three times the average annual wage paid to employed labor.  By 1939 this margin had been reduced to 81% of such annual pay and by 1944 it was further reduced to just 21% of the employee's annual wages.  Today, it amounts to a meager 8%.  These graphs help explain.

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