seek for additional revenue sources because government expenditures increase significantly during war or when a war is about to break out. The consequences of policies that focus to secure enough income sources have tremendous impact on the economy and often go even beyond the war itself. The determinants of how to provide financial funds are therefore driven by political interests giving different parties the opportunity to conceptualize and secure certain fiscal interests of their core constituencies. In the United States, the Republicans and their predecessors - the Whigs and Federalists - favoured to impose taxes, when the taxation was introduced as an ad valorem tariff or excise tax. These tax modes favoured manufacturing and business interests, the Republican base. The Democrats, however, traditionally tended to abstain from taxes because their support came from the South, a strong exporting region that would suffer from tariffs and excise taxes. With the constitutionality of income taxes in 1913, the Democrats advocated a progressive income tax due to the important role of labour in their political base. With the business sector being its main political base, the Republicans opposed higher income taxes, rather favouring less fiscal policy, including on war taxation. The high repercussions and redistribution effects of taxes lead to various political interests. Thus, different lobby groups formed trying to have determining influence on the tax mode, when political leaders tried to generate revenues from taxing or other alternatives. Case Study: War costs of Afghanistan and Iraq Not surprisingly, instrumental politicians tend to avoid war taxes, especially when the reasonableness of a war is publicly challenged or when the real cost of a war a difficult to calculate. This was also confirmed in the case of the Afghanistan (2001) and Iraq (2003) war. Both wars were financed through heavy borrowing. In 2003, the Bush-Administration reckoning with a fast conquering expedition estimated the cost of the Iraq war at $50 billion to $60 billion. This turned out to be a severe miscalculation, when it became clear that the conquering of Iraq was much more complicated and that stability of Iraq required a long-term engagement of the US military. Three years later, in February 2006, a working paper authored by economists Linda Bilmes and Joseph Stiglitz already believed the true cost to be more than one trillion dollars, taking a conservative approach and supposing a troop withdrawal by 2010, not even including costs borne by