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War debts are greater than tariffs and excise revenues so congress passed the federal income tax law. never enacted because the consitution bans direct tax on property
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Congess Amends the law and gets it passed, it is the first tax based on people's ability to pay
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Income Tax rate is increased to 5% and 10 % tax brackets.
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The federal income tax is repealed
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new version passed with a flat rate of 2%
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the flat rate is declared unconstitutional because any direct tax is to be divided among the states based on population.
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the 16th amendment would allow for the federal government to create an income tax without reguard for population of states.
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the 16th amendment is passed