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“…With President Roosevelt's signature yesterday, the Highway Act of 1905 became law. The scope of the Act is to ensure the safety of the public byways by making improvements to roads, bridges and signage that accommodate the increasing number of Automobiles in the nation. The improvement called for in the Act are paid for by though the establishment of an excise tax, based on the horsepower of the automobile engine. The tax is incremental in nature. Automobiles under three horsepower are taxed at a rate of $1 per horsepower. The remaining horsepower tax brackets are shown in the adjacent table. The tax is only assessed on vehicles intended for personal passenger use. Commercial machines such as delivery trucks and taxi cabs are to be assessed at a rate half that of private machines. Steam automobiles have their own tax rate, and electric automobiles are exempted from the tax.

Tax Horsepower Assessed Rate
3 and below $1
3 to 9-9/10 $1.35
10 to 16-9/10 $1.70
17 to 23-9/10 $2.05
24 to 30-9/10 $2.40
31 to 37-9/10 $2.75
38 to 44-9/10 $3.10
45 and above $3.50

The Revenue Service will use the following formula to calculate Tax Horsepower: 3.15 x Engine Cylinder Bore diameter in inches x Number of cylinders DIVIDED BY 2.5..."

Excerpt from the Wisconsin State Journal, December 19th, 1905.
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