W. Marc Gilfillan, CPA, NC, individual and business CPA and Tax expert, shares about the history of taxes…

“Slavery - the one cause of the Civil War.” - John Stuart Mill, 1862

Can there be a doubtful thoughts about this topic? Of course the American Civil War was about slavery… was it not? Well actually, one of the most popular myths in our history is that the Civil War began because of the slavery issue and that Lincoln, the Great Emancipator, fueled a terrible war to break the chains of bonding that shackled over 3 million black Americans. Right before the war, the South had everything its way.

In 1860, the South held the Supreme Court and Lincoln and Congress were beginning the process of passing a constitutional amendment to keep slavery forever! So what happened?

Let’s move the time back to the year 1832. By 1832 the national debt from the War of 1812 had been re-paid and Southerners didn’t see a need to continue the high import taxes which appeared to only jack up prices for the South’s consumers. Either the South paid high import taxes on imported goods or it bought Northern manufactured goods at terribly overpriced prices. In either case, Southern funds transferred to the North. To say the South wasn’t content with this arrangement would be an understatement. If you are feeling the pressure with today’s taxes, call a CPA for Tax Preparation in Raleigh, NC for all your tax-related needs!

So, in 1832 a convention was held in South Carolina to get rid of these federal import taxes. The convention declared the tax was unconstitutional and gave the governor the power to to resist the enforcing of the import taxes instituted by the national government. It looked like a civil war was in the making. Mild tempers won over, however, and the Great Compromise of 1833 reduced import taxes over the subsequent few years to an area the South could tolerate. Go here if you want help with a modern-day Tax Return in Raleigh, NC.

Over the ensuing years, however, Northern corporate and manufacturer companies forced into Congress new taxes that again oppressed Southern planters and allowed Northern Manufacturers to become rich once again. In 1850, John C. Calhoun, the South’s most exceptional spokesman, delivered a speech to Congress. His speech listed three grievances of the South that may cause secession from the Union and war. The first two had to do with fears about the erosion of power of the South in general and the states as well.

The third, and only concrete complaint, concerned tax policy. In Calhoun’s view, national import taxes was a targeted legislation against the South. Huge amounts of taxation on the South raised money that was used in the North. The focus of economic strength in the United States was shifting strongly to the North. Calhoun threatened secession if the taxes were not lowered. But what of the slavery issue? Well, during his campaign for the presidency in 1860, Lincoln repeatedly said he wouldn’t interfere with slavery in the South. Actually, the vast majority of Northerners did not really care about black men in bondage, any more than they cared about the Indian in the West or poor uneducated workers in factories. The majority of black slaves got substantially better quality treatment and more compassion than their counterparts in the North. Lincoln, in fact, promised Southern plantation-owners that run-away slaves would be returned. The Congress and subsequently the Supreme Court (Dred Scott decision) further acknowledged that slavery was here to stay.

However, just as Lincoln was placed in office and Congress came together in 1861, they enacted new high import tariffs. Slavery was not an issue - higher import taxes were. In his inaugural address Lincoln said he would collect the customs in the South even if there was a secession!

Fort Sumter, near the beginning of the Charleston Harbor, began filling with Union troops to enforce the collection of the new taxes. The Civil War began in 1861 when South Carolinians shot at the federal garrison at Fort Sumter. The inevitable had been stewing for decades - but it was not about slavery. It was about tax policy.

2 years later, Lincoln issued the Emancipation Proclamation, and then only following several military battles, as a last resort to rally the North behind a noble cause. To address the slave issue - most the North did not care much about black people in bondage, no more than they cared of Indians in the west or poor illiterate workers in the factories. Ironically, most black slaves got better treatment and greater compassion than their impoverished counterparts in the North.

That’s it for the History of Taxes Series!

http://www.marccpa.com/

Technorati Tags: accountant, bookkeeping, cpa, income tax, marc gilfillan, NC, raleigh, tax, tax preparation, tax return, taxes