The Revenue Act or Wilson-Gorman Tariff of 1894 (ch. 349, §73, 28 Stat. 570, August 27, 1894) slightly reduced the United States tariff rates from the numbers set in the 1890 McKinley tariff. It is named for William L. Wilson Representative from West Virginia, chair of the U.S. House Ways and Means Committee, and Senator Arthur P. Gorman of Maryland.
Supported by the Democrats, this attempt at tariff reform was important because it imposed an income tax of two percent to make up for revenue that would be lost by tariff reductions. The bill introduced by Wilson and passed by the House would have made significant reforms. However, by the time the bill passed the Senate, it had more than 600 amendments attached that nullified most of the reforms. The "Sugar Trust" in particular made changes that favored it at the expense of the consumer. President Grover Cleveland, who had campaigned on tariff reform and supported Wilson's version of the bill, was devastated that his program had been ruined. He denounced the revised measure as a disgraceful product of "party perfidy and party dishonor," but still allowed it to become law without his signature, believing that it was better than nothing and was at the least an improvement over the McKinley tariff.
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Income Tax Amendment
The New York Times reported that many Democrats in the East and South, "prefer to take the income tax, odious as it is, and unpopular as it is bound to be with their constituents," than to defeat the Wilson tariff bill. [1] Democratic Representative Johnson of Ohio supported the income tax as the lesser of two evils: "he was for an income tax as against a tariff tax; but he believed, that it was un-Democratic, inquisitorial, and wrong in principle." [2]
Legacy
The income tax provision was struck down in the U.S. Supreme Court case Pollock v. Farmers' Loan & Trust Co., . Ultimately, the 16th Amendment overruled the holding in the Pollock case, paving the way for the modern Federal income tax in 1913. The tariff provisions of Wilson-Gorman were superseded by the Dingley Tariff of 1897.
References
- Lambert, John R., Arthur Pue Gorman (1953)
- Rhodes, James Ford, History of the United States from the Compromise of 1850 to the Mckinley-Bryan Campaign of 1896. Volume: 8 1920. ch 19 pp 418-24
- Summers, Festus P., William L. Wilson and tariff reform,: A biography (1953)
- Williams, John Alexander. "The Bituminous Coal Lobby and the Wilson-Gorman Tariff of 1894" Maryland Historical Magazine 1973 68(3): 273-287
Notes
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