c) The Civil War

The Civil War, a pivotal event in American history, led to the introduction of the first income tax in the U.S. in 1861. This tax was implemented to fund the Union war effort and represented a significant shift in American fiscal policy. Prior to the Civil War, the federal government primarily raised revenue through tariffs and land sales. The income tax was a progressive tax, meaning that those with higher incomes paid a higher rate, a concept that laid the groundwork for the modern American tax system. Although the tax was repealed in 1872, it set a precedent for federal income tax, which was permanently established with the 16th Amendment in 1913.