Love it or hate it, it’s that time of year again when Americans face their annual reckoning with Uncle Sam: April 15 or, simply, tax day. Many Americans go through the motions of paying their taxes as a dreaded but necessary ritual. This eye-rolling, annual chore is annoying, obviously, but also tied to the functioning of government.
Recently, anti-tax sentiment has increased with the rise of MAGA Republicans and a second Trump Presidency. Project 2025 calls for eliminating income taxes altogether and drastically slashing taxes for corporations and the wealthiest Americans. President Donald Trump has even suggested abolishing the IRS and replacing income taxes with tariffs. In the meantime, many of the wealthiest Americans have embraced tax evasion. Few, it seems, regard tax-paying as particularly profound or meaningful. Yet, historically, American attitudes toward taxes reveal a great deal about the quality of life in America, institutional trust, and social cohesion in general. Ironically, the 1950s era that MAGA Americans regard nostalgically was the height of fiscal patriotism—a time when the wealthiest Americans were willing to pay higher taxes for the benefit of all.
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Before World War II, less than 1% of Americans paid an income tax of only 1% of net income, which had been established by the Sixteenth Amendment to the U.S. Constitution in 1913. But after the attack on Pearl Harbor, Congress passed a new Revenue Act in 1942 to fund the U.S. war effort. President Franklin Delano Roosevelt knew from experience that the rich would resist any new taxes to fund the war. He had been sparring with the rich since the 1930s when they had tried to sabotage his New Deal. But the shock of Pearl Harbor prompted even the top two business lobby groups, the National Association of Manufacturers and the United States Chamber of Commerce, to support FDR’s plans for increased taxation.
Paying taxes was regarded as a patriotic duty. “Paying taxes to beat the Axis!” became a rallying cry in the midst of America’s efforts to defeat fascism. In 1942, Walt Disney himself was tapped by the U.S. government to create a motivational video educating Americans about the importance of paying taxes. In 1943, a second video was created showing Donald Duck’s taxes funding the boys fighting fascism abroad while a narrator’s booming voice declared, “Every dollar you sock away for taxes is another dollar to sock the Axis!” These videos were wildly successful, cementing the idea that paying higher taxes, especially for the wealthy, was a civic responsibility.
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The top marginal tax rate soared as high as 94% in 1944 on incomes over $3.6 million (in inflation-adjusted dollars) and stayed at 90% for the next two decades. The corporate tax rate peaked at 53% during the war and stayed there for even longer, not falling under 40% until the 1980s.
The effects of what FDR called an “equity-in-sacrifice” economy were spectacular. Higher taxes on top really did mean a better quality of life at the bottom. Many wartime taxes remained in place after the war ended, funding infrastructure, education, and housing—all of which laid the foundation for an expanding middle class. During this time, labor unions thrived. And the G.I. Bill made a college education and home ownership accessible for millions of (mostly white) men, due to race-based admissions quotas and discriminatory lending practices. Although the gains of the post-World War II economy were not evenly shared across racial lines, this period helped lay the groundwork for significant social and economic advancements, including the rise of a Black middle class and the strengthening of the Civil Rights Movement, which gained momentum in part due to the economic and social changes of the postwar era.
But FDR and Vice President Henry Wallace were also after something more. They wanted Americans to learn from the horrors of Nazi Germany. They knew that demagogues like Adolf Hitler were more likely to come to power in plutocratic societies where wealth was concentrated and untaxed. Taxing away excess wealth was not just about funding a war but also about putting a check on fascism, even at home.
FDR’s vision of an “equity-in-sacrifice” economy seemed to have won the day. And it did, for a while. Amid this wave of patriotic tax compliance, one woman planted the seeds for a radically different vision. Businesswoman Vivien Kellems foreshadowed an opposing view of taxation that, although labeled as treasonous at the time, would later become dominant. Kellems argued that withholding taxes was unconstitutional because it represented “deprivation of property without due process of law” and “involuntary servitude.” Kellems attracted media attention, mostly negative: she was widely labeled a “traitor” in the context of World War II fiscal patriotism. Public reaction to her “crackpot” ideas reflects just how completely patriotism and taxation had fused during the war.
As the war receded, wealthier Americans began falling into lockstep with Kellems whose arguments were eventually no longer considered treasonous. In the 1950s through 1970s, the top marginal tax rates remained quite high. Even though President John F. Kennedy finally brought taxes down in the early 1960s from their wartime levels, the top marginal tax rate was still at a whopping 70%, down from 91%. And JFK was hardly an anti-tax conservative. Influenced by Keynesian economics, JFK wanted to pump more of consumers’ money into the economy (noting that the high-tax wartime economy should not be kept in place forever) while also increasing spending on social programs including unemployment benefits, Social Security, and highway construction. The high marginal tax rates throughout this period prompted wealthier Americans to take advantage of loopholes such as buying rental properties and creating collapsible corporations, among others. Over time, these tax evaders began reframing their tax resistance as a form of patriotism, a reversal of FDR’s fiscal patriotism.
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By the time of the Reagan Revolution in the 1980s, the stage was set for slashing the corporate tax rate from 73% to 28%–the lowest it had been since 1925. The top marginal tax rate was also slashed from 70% to 33% by 1989. But the wealthiest Americans were not satisfied with these cuts. Today, tax evasion is so common that the Treasury Department estimates the top 1% of wealthy Americans annually evade $163 billion in owed taxes.
Income and wealth inequality, which had steadily declined from the 1940s through the 1970s, have been rising ever since. Though Trump has gone back and forth on his tariff promises, it must be stated that his proposal to replace income taxes with tariffs would further unravel the concept of fiscal patriotism. The period of American history that marks the peak of tariffs as a source of federal revenues was from the 1870s through the early 20th century—also known as the Gilded Age, an era of extreme income and wealth inequality. Tariffs, essentially a consumption tax that raises the price of imported goods, worsen inequality because lower-income households are hit the hardest by price increases. In other words, tariffs are a regressive tax—the polar opposite of FDR’s postwar economy. Historically, there are no examples of an economy based only on tariffs that successfully fostered a prosperous, equitable society.
As FDR and Wallace warned, income and wealth inequality soar in societies that refuse to tax away large concentrations of wealth. The foundations of the middle class begin to crack and split open. Public services and infrastructure can no longer be funded, leading to privatization. And the excess purchasing power caused by excess (untaxed) wealth distorts markets, leading to inflated prices for ordinary people. Trust in institutions, quality of life, and social cohesion all decline, leading to an increased risk of demagoguery.
Today, we are grappling with the resurgence of plutocracy, where the richest few wield disproportionate power, and the collective good is increasingly sidelined. As we face another Tax Day, we would do well to remember the type of broad-based prosperity that progressive taxation once created in America. While tax loopholes for the wealthy and the rollback of progressive taxation have made Tax Day almost universally reviled, we should not lose sight of what a just tax system can do for our society.
Dr. Betsy Wood is an American historian and author of Upon the Altar of Work: Child Labor & the Rise of a New American Sectionalism. She teaches American history at Bard Early College in Newark, NJ. Dr. Wood is writing a second book about American attitudes towards taxation from World War II to the present.
Made by History takes readers beyond the headlines with articles written and edited by professional historians. Learn more about Made by History at TIME here. Opinions expressed do not necessarily reflect the views of TIME editors.