nt did not, however,
establish an income tax. It merely authorized the government to do this
at will. President Wilson's administration was prompt to take the
matter up. The Democrats, in conjunction with their reduction of the
tariff, needed a new source of revenue. So in October of 1913 the
Income Tax law was passed. In theory an Income Tax is obviously the
most just of all taxes. It summons each citizen to pay for the
government in proportion to his wealth; and his wealth marks roughly
the amount of government protection that he needs. In practise,
however, the working out of an income tax is so complex that every
grumbler can find in its intricacies some cause of complaint. The
present tax is therefore described here by an expert statistician, Mr.
Joseph A. Hill, the United States Government official at the head of
the Division of Revision and Results of the Census Bureau in
Washington.

Among the notable events of the year 1913, one of the most important in
its influence upon the national finances and constitutional development
of the United States is the adoption of an amendment to the Federal
Constitution giving Congress the power "to lay and collect taxes on
incomes, from whatever source derived, without apportionment among the
several States and without regard to any census or enumeration." The
mere fact that an amendment of any kind has been adopted is notable,
this being the first occasion on which the Constitution had undergone
any change since the period of the Civil War, and the first amendment
adopted in peaceful and normal times since the early days of the
Republic.

It is a little remarkable, although perhaps not altogether accidental,
that the adoption of this amendment should coincide with the return to
power of the political party whose attempt to levy an income tax in
1894 was frustrated by the decision of the Supreme Court in that year.
Then as now an income tax was a component part of the program of fiscal
and commercial reform to which that party was committed. This program
included the reduction of protective tariff duties and the direct
taxation of incomes. What the Democratic party failed to accomplish in
1894, it has had a free hand to do in 1913. Indeed, the national
taxation of incomes might almost be regarded as a mandate of the people
of the United States. At any rate, it was a foregone conclusion that
the adoption of the constitutional amendment would be immediately
followed by the en