What significant change occurred in tax revenues as a result of WWII?

The significant change in tax revenues as a result of World War II was a substantial increase in revenues from taxation. During the war, the U.S. government significantly expanded its spending to support military operations and the war economy, leading to a need for greater revenue. To fund these efforts, the government implemented several measures, including broadening the tax base and increasing tax rates.

The Revenue Act of 1942 is a notable example, which not only raised income tax rates but also introduced withholding taxes on wages, effectively capturing a larger share of individuals' earnings. This resulted in a much larger percentage of the American population paying income taxes compared to previous decades, and thus, overall tax revenues rose dramatically during and immediately after the war. Therefore, the correct answer highlights the impact of wartime fiscal policies that led to a marked increase in tax revenues.