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The fullest discussion of the Confederate income tax that I could find online is the appendix on "The Income Tax in the Confederacy" in Edwin R. A. Seligman's *The Income Tax: A Study of the History, Theory, and Practice of Income Taxation at Home and Abroad* (1911). which can be found at https://books.google.com/books?id=zQ8rAAAAYAAJ&pg=PA482

Some thoughts provoked by Seligman:

(1) Seligman's statement that "had the fortunes of the war been determined by the comparative ability of the statesmen and the generals rather than by sheer economic superiority, there is not much doubt but that the South would have been the victor" is questionable but was pretty much conventional for his time (1911) when the Lost Cause cult was riding high. Of more recent judgments, I prefer Eric L. McKitrick's that "It is generally supposed that Lincoln's cabinet was the 'better' one, though there is little agreement as to the reasons. One authority emphasizes the over-all deficiencies of the Confederate cabinet; another calls attention to its many merits. It is at least clear that both cabinets contained a mixed lot. Each had its good administrators, and on both sides there was incompetence. Leroy Pope Walker may have made a very poor Secretary of War, but the Union had to fight the first nine months of the war with Simon Cameron. Comparisons on this level, in short, are certainly enlightening, but they take one just so far..." "Party Politics: Union and Confederate" in Walter Nisbet Chambers and Walter Dean Burnham (eds) *The American Party Systems: Stages of Political Development.*

(2) Note that Seligman, when he refers to a "direct tax" uses the term in the sense it was used by courts for most of the nineteenth century (before *Pollock*)--a poll tax or tax on real property: "The Confederacy, like the Union, started out with a direct tax" and he distinguishes that from the income tax later adopted. Indeed, Confederate Secretary of the Treasury Memminger, in urging the adoption of an income tax, seems to have made the same distinction: "The direct tax heretofore levied has set in operation all the machinery necessary to levy another; and an income tax could be collected by the same means. It seems to me that both these forms of tax should be adopted." Incidentally, President Davis's ruling that "as the war precluded the taking of any census...the provision as to apportionment of the [direct] tax might be dispensed with" seems rather specious to me: why not use the 1860 US census data for the states in question? (But maybe it wasn't yet available in 1861, when the issue
first came up.)

(3) The complexity of the Confederate income tax, the fact that "The rate of the tax was progressive, the scale being considerably higher than in the Union" and the "class war" rhetoric with which the Confederate commissioner of taxes justified his request for a higher income tax on the well-to-do ("This may be considered exorbitant, and capitalists may think it oppressive, but it is neither. Every man should be satisfied with a support for himself and family, and all he makes above that should be divided with his country. No man should desire to amass a fortune, or to increase his fortune, if he already has one, from the hard necessities of a bleeding country.") should give pause to anyone who thinks that the Confederacy was, even for white people, more libertarian than the Union.

(4) Seligman states that "what might have happened with the Confederate income tax under more favorable auspices is a useless speculation." Well, I'm a great fan of useless speculation. So let's ask ourselves: Suppose the Confederacy had won the war (*for the moment* let's not ask how) sometime after it had enacted the income tax. Would it have kept the tax after the war?

It is at first tempting to say No, that such a tax would be too unpopular to survive after the war. But if you look carefully at what Seligman says, while the Confederate tax system was indeed unpopular, the protests do *not* seem to have been directed against the "income tax proper" but against the tax in kind, which was seen as discriminating against farmers. Indeed, raising the income tax proper on the well-to-do, and allowing farmers to pay certain taxes in money instead of in kind were two of the remedies sought to allay popular discontent. In any event, the Confederacy after the war will presumably need a considerable military establishment. One must guard against a possible new war with the Yankees--there are all sorts of reasons it could develop (clashes over Latin American territory desired by both sides, alleged outrages against Northerners in the South or Southerners in the North, etc.) *Any* method of financing the necessary military establishment will have opponents. The Confederate Constitution prohibited a protective tariff; and while one could raise tariffs "for revenue" (with any protective effect being "incidental") a good many farmers will see this as an unfair subsidy for industrialists. Robert Fogel argued in *Without Consent or Contract* (p. 415) that "The Confederacy could have financed its expansionist, proslavery policies by exploiting the southern monopoly of cotton production. A 5¢ sales tax on cotton not only would have put most of the burden of such policies on foreign consumers, but would have yielded about $100 million annually during the 1860s--50 percent more than the entire federal budget on the eve of the Civil War. With such a revenue the Confederacy could have emerged as one of the world's strongest military powers..." However, while the Confederate Constitution, unlike that of the US, did not absolutely prohibit export taxes, it did require a two-thirds
majority in Congress for them ("No tax or duty shall be laid on articles exported from any State, *except by a vote of two- thirds of both Houses.*" [emphasis added] http://www.constitution.org/csa/csa_cons.htm) and this could be hard to get.

So it may be that the Confederacy--by default--still has to rely on the income tax after the war (just as the Union, in this ATL, having to worry about the Confederacy as a military rival, may not repeal the income tax as it did in OTL in 1871). Could apportionment have been avoided? There is no reason Confederate courts could not have approved *Hylton v, United States* where all the participating justices, northern and southern, seemed to agree that the term "direct tax" referred principally, if not exclusively, to poll taxes and taxes on real property. http://press-pubs.uchicago.edu/founders/documents/a1_9_4s13.html That this was a "Federalist" court would not mean that Confederate courts would disapprove of its decisions; Eric McKitrick (in "Party Politics: Union and Confederate," cited above) has noted that judicial review in the Confederacy (done through the state courts, since the Confederate Congress never got around to establishing a Supreme Court) featured "generous citations from *The Federalist,* as well as from the opinions of Marshall and Story..."

Thoughts (or "useless speculation")?
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