Use the table and your knowledge of social studies to answer the following questions. how did wilson compensate for the reduced government income resulting from his lowering of tariffs?
a. creating an income tax
b. taxing businesses
c. charging federal interest on loans

The correct answer is A) creating an income tax.

President Wilson compensated for the reduced government resulting for its lowering tariffs by creating an income tax.

As part of the Revenue Act of 1916 and due to the decrease in trade because of war, President Woodrow Wilson created an income tax as an important source of revenue for the government. With this new resolution, the government expected to raise $205 million dollars, and half of that number would come by new income tax. Another measure incorporated in that law was to raise the corporation income tax from 1 to 2 percent.