A History of Tax Regulation Prior to the Administrative Procedure Act

Abstract

The relationship of the APA to tax administration has been the subject of increasing scrutiny from scholars and courts. Some of this scrutiny has critiqued the long-held view of the Department of Treasury that tax regulations issued under the general grant of authority in I.R.C. § 7805(a) are interpretative regulations within the meaning of the APA. Scholars and courts alike complain that "tax exceptionalism" has no place in the application of the APA. This Article reviews the almost 150-year history of tax administration before enactment of the APA to show the origins and basis for Treasury's long-held view. The Article also argues the very concept of "tax exceptionalism" rests on an erroneous premise. Rather than assuming that the APA provisions carry uniform meaning as applied to all federal agencies, this article submits that the general terms of the APA must be informed by the pre-APA history of tax regulation.

Keywords: Tax Exceptionalism, administrative procedure act, APA, Civil War, Tariff, legal history, tax administration, george boutwell, levi woodbury, regulation, rules, notice and comment, cohen, board of tax appeals, treasury decisions, treasury regulations, revenue act 1864, internal revenue, tax history

JEL Classification: K34, K40, K41, K42, K49, N41, N42