Final answer:
Farmers favored the graduated income tax because it offered a fairer system based on the ability to pay, it helped in redistributing wealth, allowed for tax deductions and exemptions for farmers, and promoted investment in agriculture.
Step-by-step explanation:
Farmers favored the adoption of a graduated income tax because it provided a more equitable tax system based on each individual's ability to pay. This method was intended to decrease income and wealth inequalities by redistributing wealth from higher income groups to lower income groups. This progressive nature of income tax helped redistribute wealth and reduced the burden on farmers, who often fell into lower income groups, allowing them to benefit from tax deductions and exemptions. Additionally, this system promoted investment in agriculture and rural development, providing further benefits to farmers.
For instance, during the 1890s, the Populists sought to enact a modest federal income tax that would affect only the wealthy. Consequently, with the ratification of the Sixteenth Amendment, a federal income tax system was established where only the wealthiest 5% households paid the federal taxes, with the tax rates being relatively modest. Over time, as the federal government expanded, tax rates increased, rendering the system more progressive and fairer.
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