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SIMON LLOYD: The roots of income tax that was originally intended solely to help the government cope with war costs

The presses were humming at The Guardian and The Patriot as the debate rages over the military vote announcement at the end of February 1918. 123RF/SUBMITTED PHOTO
The presses were humming at The Guardian and The Patriot newspapers as the debate raged over the military vote announcement at the end of February 1918. 123RF/SUBMITTED PHOTO - The Guardian

After the military vote announcement at the end of February 1918, The Guardian spent the next week or so trading editorial recriminations with Liberal arch-rival, The Patriot.

A March 2 column captured the tone: “The Patriot’s characteristically hysterical outburst in its yesterday’s issue will scarcely be regarded by any of its sane readers as an effective defence of its attitudes on the election.”

However, by the following weekend, The Guardian was evidently tiring of arguments over what was, after all, a done deal. A short editorial on March 9 proclaimed the Union government’s election victory the most “unanimous and impressive mandate” ever accorded “any Government anywhere,” and with that — and a parting jab at “old and tired Liberal newspapers,” — The Guardian moved on to other matters.

Issues of food supply and agricultural production were a major editorial preoccupation through mid-March. The Dominion Government’s newly-launched Soldiers of the Soil initiative, for example, aimed at recruiting teenage boys for farm labour, drew approving comment on March 14 and 15.  A Canada Food Board advertisement in the March 20 issue promised a bronze badge of honour to every Soldier of the Soil who gave three months “satisfactory service”, and concluded: “Canada wants at least 25,000 boys to volunteer. How about it boys?”

March brought yet another unprecedented demand to Canadian households. For the first time ever, individuals had to file tax returns under the Income War Tax Act, with a deadline of March 31. Viewed from today’s perspective, the income tax rates of 1918 look incredibly low and the exemptions remarkably generous. But the Government clearly anticipated significant reluctance: the late filing penalties were ferocious – nearly $1,600 per day in 2018 terms – and falsified returns could be punished with a $10,000 fine and/or six months imprisonment.

Income tax was originally intended solely to help the government cope with staggering war costs — federal spending had quadrupled from pre-war levels — and would hit almost $700,000,000 in 1918 — but The Guardian seemed unable to summon the same zeal for direct taxation as it did for other wartime measures.  Nevertheless, at least one occasion was found to take up the editorial cudgel in the income tax cause. A March 20 column expressed indignation that no officials had been appointed for administering the new tax on P.E.I. and that the Island had, instead, been “tacked … on to Halifax.” This curious affront to provincial pride notwithstanding, The Guardian reported on March 23 – in a tiny item on page three – that income tax forms were now ready for distribution from Island post offices.

By late March, however, there were far more momentous developments afoot. It had been widely expected that a major German offensive on the Western Front would take place sometime in the Spring of 1918, but the attack unleashed in northern France on March 21 was so stunningly fierce and effective that the entire British Fifth Army was soon in retreat. The Germans had, through a combination of good luck and good planning, been able to strike at a section of the British line where defenses happened to be singularly patchy and ill-prepared, allowing advances far larger and faster than the Allies had expected.  Nor did it help Allied nerves that the Germans quickly deployed a new secret weapon, bringing forward several massive railway guns to shell Paris from more than 120 km away. Worst of all, the Germans had, in just a few days, come within striking distance of the British military’s vital strategic hub, Amiens.  The Guardian banner headline of March 25 was scarcely hyperbole: “Greatest Battle in World’s History Now Being Fought on the Western Front”.

The Guardian struggled to maintain a reassuring tone, but an editorial on March 28 noted, “the numerous enquiries by telephone that reach the Guardian from different parts of the province from those whose anxiety will not permit them to wait for the morning issue”. The last lead editorial of the month, on March 29, proclaimed, “the shadow of war ... is indeed darker and blacker today than on any Easter since the beginning of the War.”

Simon Lloyd is librarian responsible for the P.E.I. collection at the University of Prince Edward Island Robertson Library's University Archives and Special Collections. This is part of a monthly series of lookbacks at the First World War he will be providing, drawing on the historic issues of The Guardian available online at

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