How was federal government funded before federal income taxes?

Answer 1

Article I, The Constitution of the united States of America.

Section. 8. "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises,...... but all Duties, Imposts and Excises shall be uniform throughout the United States;"

Section. 9.

"No Capitation, (head tax) or other direct, Tax shall be laid, ."

"No Tax or Duty shall be laid on Articles exported from any State."

　

Above, is the law governing taxes by the Federal government before the income tax and other taxes placed upon incomes (i.e. Social Security, etc.).

Duties are tariffs upon imported goods. Imposts are an extra tariff placed upon goods imported or exported out of the nation. And Excises are generally a tax placed upon a good, foreign or domestic

Section 8 gave Congress the power "to Tax," also. This relates to and is regulated by Section 9. The Congress could place a tax upon the States, but it had to be placed based upon the population of each state vs. the population of other states or by "Proportion." (To my knowledge, this was never used).

After the War between the States (American Civil War), an Impost Tax was placed upon goods imported and exported to and from Confederate States and Union States. This Impost is still good today. This was to punish the Confederate States, but the Constitution does not prohibit the use, because it says:

"No Tax or Duty shall be laid on Articles exported from any State."

It does not say any thing about "Impost." So, this is how they justified its use.

President Thomas Jefferson called the system fair, because the rich bought the foreign goods with taxes upon them, while, the poorer farmer did not receive the burden of taxation.