The Evolution of Income Tax: Understanding the 16th Amendment with Legal Historian Dr. James Ely

Watch the most recent installment in our Amendment Series featuring Dr. James Ely, a renowned legal historian and property rights expert. Dr. Ely’s award-winning scholarship has examined American legal culture and Supreme Court history, including his 2023 article “One of the Safeguards of the Constitution: The Direct Tax Clauses Revisited. Together, we explored the historical context of the 16th Amendment, learning about its significance at the time of its ratification in 1913 and its impact on the American economy and society.

Ratified in 1913, the 16th Amendment granted Congress the authority to issue an income tax without determining it based on population. This Amendment fundamentally changed how the federal government is funded, moving from domestic and international tariffs to an income tax system. Following the Civil War, Congress struggled to bridge the growing economic gap between southern and western farmers and eastern industrial growth. Several income taxes were passed but repealed until 1909, when conservatives proposed a constitutional amendment that was eventually ratified in 1913.

Dr. Ely will explain why the 16th Amendment was needed and how it continues to influence modern tax policy and legal debates. Understanding its origins and implications can provide insight into current fiscal policies in the U.S.

Like all USCHS programs, this webinar is free and open to the public; registration is required.

About the Author

Dr. James Ely is a renowned legal historian and property rights expert whose career accomplishments were recognized with both the Brigham-Kanner Property Rights Prize and the Owner Counsel of American Crystal Eagle Award in 2006.

He is the author of several books that have received widespread critical acclaim from legal scholars and historians, including The Guardian of Every Other Right: A Constitutional History of Property RightsThe Chief Justiceship of Melville W. FullerRailroads and American Law, in which he systematically explores the way that the rise of the railroads shaped American legal culture, and The Contract Clause: A Constitutional History. He also served as an editor of both the second edition of the Oxford Companion to the Supreme Court and the second edition of the Oxford Guide to Supreme Court Decisions. Professor Ely received the Tennessee History Book Award in 2002 for A History of the Tennessee Supreme Court. Between 1987 and 1999, he served as an associate editor of the American Journal of Legal History.

Professor Ely joined the Vanderbilt faculty in 1972 and is currently the Milton R. Underwood Professor of Law, Emeritus, and Professor of History, Emeritus.

This article investigates the direct tax clauses of the Constitution, which require that such taxes levied by Congress must be apportioned among the states according to population. In practice, the apportionment rule was cumbersome and discouraged reliance on direct taxes as a source of federal revenue. Proposals for a federal tax on wealth have triggered renewed interest in the direct tax provisions. This article examines the history and purpose of the direct tax clauses, and takes a new look at the heading judicial opinions interpretating these provisions.

The historical record points to the conclusion that a tax on existing wealth is a direct tax and therefore unconstitutional unless apportioned among the states according to population.