Revenue Act of 1862

Examples of Revenue Act of 1862 in the following topics:

• Union Finances

  • The Morrill Tariff and the Homestead Act were among the far-reaching changes enacted by Congress in this period to fulfill the Republican vision of an industrial nation.
  • The United States required more than three billion dollars to pay for the immense armies and fleets raised to fight the Civil War and more than $400 million in 1862 alone.
  • The Morrill Tariff was also an important source of tax revenue.
  • The Union also levied the nation's first income tax with the Revenue Act of 1862.
  • The Legal Tender Act of 1862 was enacted in February 1862 to issue paper money to finance the war.

• Higher Education

  • The Morrill Land Grant Colleges Act of 1862 provided for the establishment of public colleges for "liberal and practical education".
  • The Morrill Land-Grant Acts are United States statutes signed into law by President Abraham Lincoln on July 2, 1862 that allowed for the creation of land-grant colleges.
  • The resulting management of this scrip by the university yielded one third of the total grant revenues generated by all the states, even though New York received only one-tenth of the 1862 land grant.
  • The 1862 Morrill Act allocated 17.4 million acres (70,000 km2) of land, which, when sold, yielded a collective endowment of $7.55 million.
  • Though the 1890 Act granted cash instead of land, it granted colleges under that act the same legal standing as the 1862 Act colleges; hence, the term "land-grant college" properly applies to both groups.

• Government During the War

  • With the establishment of the Confederacy, Republicans in Congress enacted sweeping federal changes, including implementation of the Morrill Tariff and passage of the Homestead Act, Pacific Railroad Act, and National Banking Act.
  • By taxing British imports, the Morrill Tariff provided an additional source of revenue and encouraged the establishment of domestic factories.
  • The Pacific Railroad Act of 1862 promoted the construction of the transcontinental railroad in the United States.
  • The 1862 Homestead Act opened up public-domain lands for family farms at no cost.
  • The permanent Confederate Congress began its first session on February 18, 1862.

• Higher Education

  • The Morrill Land-Grant College Act was a U.S. statute signed into law by President Abraham Lincoln on July 2, 1862, that allowed for the creation of land-grant colleges.
  • Aided by the secession of many states that did not support the plans, this reconfigured Morrill Act was signed into law by President Abraham Lincoln in 1862.
  • After the war, however, the 1862 Act was extended to the former Confederate states; it was eventually extended to every state and territory, including those created after 1862.
  • The 1862 Morrill Act allocated a total of 17.4 million acres of land, which, when sold, yielded a collective endowment of $7.55 million.
  • Kansas State University was the first college funded by land grants under the Morrill Act of 1862.

• Fiscal Policy -- Budget and Taxes

  • (Local governments, in contrast, generally collect most of their tax revenues from property taxes.
  • The first U.S. income tax law was enacted in 1862 to support the Civil War.
  • The 1862 tax law also established the Office of the Commissioner of Internal Revenue to collect taxes and enforce tax laws either by seizing the property and income of non-payers or through prosecution.
  • The Tax Reform Act of 1986, perhaps the most substantial reform of the U.S. tax system since the beginning of the income tax, reduced income tax rates while cutting back many popular income tax deductions (the home mortgage deduction and IRA deductions were preserved, however).
  • The Tax Reform Act replaced the previous law's 15 tax brackets, which had a top tax rate of 50 percent, with a system that had only two tax brackets -- 15 percent and 28 percent.

• The Tariff

  • The United States Revenue Act of 1913 re-imposed the federal income tax, and lowered basic tariff rates from 40% to 25%.
  • The United States Revenue Act of 1913 (also known as the Tariff Act, Underwood Tariff or Underwood-Simmons Act) re-imposed the federal income tax following the ratification of the Sixteenth Amendment.
  • Underwood of Alabama guided the Revenue Act of 1913 through the House (where it passed, 281 to 139) and the Senate (where it passed, 44 to 37).
  • The Act also provided for the re-institution of a federal income tax as a means of compensating for anticipated lost revenue due to the reduction of tariff duties.
  • Within a few years after the Revenue Act was implemented, the federal income tax replaced tariffs as the chief source of revenue for the government.

• Federal Income Tax Rates

  • In order to help pay for the American Civil War, the federal government imposed its first personal income tax on August 5, 1861 as part of the Revenue Act of 1861.
  • This tax was repealed and replaced by another income tax in 1862.
  • The purpose of Wilson-Gorman tariff was to make up for revenue that would be lost by other tariff reductions.
  • In fiscal year 1918, annual internal revenue collections for the first time passed the billion-dollar mark, rising to 5.4 billion by 1920.
  • This graph shows the revenue the U.S. government has made purely from income tax, in relation to all taxes.

• The Government Debt

  • Grant's first move upon taking office was signing the Public Credit Act of 1869, which the Republican Congress had just passed.
  • The price of gold on the New York exchange fell to $130 per ounce—the lowest point since the suspension of specie payment in 1862.
  • As secretary, he opposed a rapid lowering of taxes and favored using surplus revenues to make a large reduction of the national debt.
  • In 1870, Congress, at his recommendation, passed an act providing for the funding of the national debt and authorizing the selling of certain bonds, but not authorizing an increase of the debt.
  • Finally, he revitalized tax collections to hasten the collection of revenue.

• Union Politics

  • The first of these laws to be implemented was the First Confiscation Act of August 1861, which authorized the confiscation of any Confederate property, including slaves, by Union forces.
  • In March 1862, Congress approved a Law Enacting an Additional Article of War, which forbade Union Army officers from returning fugitive slaves to their owners.
  • In June 1862, Congress passed a Law Enacting Emancipation in the Federal Territories, and in July, passed the Second Confiscation Act, which contained provisions intended to liberate slaves held by rebels.
  • The latter act also declared that any Confederate official, military or civilian, who did not surrender within 60 days of the act's passage would have his slaves freed.
  • Democrats gained 28 seats in the House in the 1862 election cycle, as well as the governorship of New York.

• Land Ordinances and the Northwest Territory

  • Under the Articles of Confederation, Congress did not have the power to raise revenue by direct taxation.
  • The Land Ordinance of 1785 laid the foundations of land policy until passage of the Homestead Act in 1862.
  • The primary effect of the Northwest Ordinance was the creation of the Northwest Territory as the first organized territory of the United States out of the region south of the Great Lakes, north and west of the Ohio River, and east of the Mississippi River.
  • The actual legal mechanism of the admission of new states was established in the Enabling Act of 1802.
  • A significant portion of Minnesota was also part of the territory.