American Minute with Bill Federer
Withholding taxes from people's paychecks began JUNE 9, 1943.
Congress passed it as an emergency measure to get money to fight
The idea came from Beardsley Ruml, treasurer of Macy's and chairman
of New York's Federal Reserve Bank.
Called the "pay-as-you-go" tax, so much money came in with so few
complaints that it continued after the war. John F. Kennedy told
Congress, April 20, 1961:
"Introduced during the war when the income tax was extended to
millions of new taxpayers, the wage-withholding system has been one
of the most important and successful advances in our tax system in
Initial difficulties were quickly overcome, and the new system helped
the taxpayer no less than the tax collector."
But Americans weren't always so taxed. In his 2nd Annual Message,
1802, Thomas Jefferson wrote:
"To proceed as we have begun in substituting economy for taxation."
President Andrew Jackson stated in his 8th Annual Message, December
"There is no such provision as would authorize Congress to collect
together the property of the country, under the name of revenue, for
the purpose of dividing it equally or unequally among the States or
the people. Indeed, it is not probable that such an idea ever
occurred to the States when they adopted the Constitution."
In his Message to Congress, May 27, 1830, Andrew Jackson said:
"Through the favor of an overruling and indulgent Providence our
country is blessed with general prosperity and our citizens exempted
from the pressure of taxation, which other less favored portions of
the human family are obliged to bear."
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