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two hundred and sixty-four will no longer be loyal representatives may come.
Not estimated. required, and the number of articles released, | inchoate repudiators lust for power. Save us Bristles, flavoring extracts, deerskins, oakum, verin proportion to the whole number remaining from these and the United States Government digris, illuminating gas of educational institutions, taxed, is still greater. will survive, with its credit and civil glories ra
paintings and statưds, aniline colors, bleaching-pow
ders, tar, turpentine, candle wicking. The law authorizing the Secretary of the diant with youth and the fame of ages, long after Treasury to assign to the Bureau of Internal the final chapter in the history of anti-repub
Mr. RAYMOND. I am sure the House has Revenue a sufficient force to carry it on will lican Governments shall have been written. listened with very great satisfaction to the clear expire by its own limitation on the 1st of July
and interesting statement which has just been. next, and it therefore becomes necessary to Estimated deductions on articles exempted and partly
made by the chairman of the Committee of maké some arrangement for the permanent
exempted from tax,
Ways and Means of the financial condition of organization of the bureau. It will be seen that Animal charcoal.....
the country. It cannot but give satisfaction Alum....
5.000 the bill makes provision for this object. The
to find the country prepared for an immediate Beeswax.
3,000 operations of this bureau are now on so large a Barrels, casks, boxes..
reduction in the amount of its internal revenue scale as to require the services of able, clear- Blooms, slabs, loops....
60,000 so very considerable as that which the commit
Boots and shocs.... headed men, trained to business, and of unques
4,400,000 Brass, rolled sheet copper...
tee proposes to make. And it will be equally tioned integrity. Such men in our country are Sheathing and yellow metal...
700,000 satisfactory to the House and to the country to highly prized, and command the highest salaries Building-stone of all kinds, burr-stones,
find that this reduction is to operate so generpaid in financial and commercial employments,
grind-stones, monuments, roofing slate,
ally upon those processes and articles which and unless we fix salaries at an adequate or Brick, draining-tiles and water-pipes... 282,000 are of most importance to the great mass of competing point we shall only command the Bichromate of potash..
30,000 the people of this nation. The bane of the
Blue vitriol and copperas. services of second-rate men.
10.000 Collins and burial cases..
I am unwilling to trespass to any considerTreasury Department is that so soon as officers Crucibles.....
10.800 able extent upon the patience of the House ; receive the stamp of its confidence they receive
Crates and baskets..
15,000 | but I shall be glad, with its indulgence, to make a loud call and the offer of more pay to go Crutches, artificiallimbs, eyes, and teeth... 25,000
a few remarks upon the general subject of taxCopper, lead, and tin.
400,000 elsewhere. The best officers are, therefore, Clothing......
11,600,000 ation, especially in the attitude in which we often mere birds of passage, here to-day but
Feather-beds, mattresses, &c.
125,000 | approach it now. Perhaps I may find an apolThe Bureau of In
Fertilizers of all kinds. may be gone to-morrow.
100,000 Flasks and patterns...
ogy for so doing in the fact that it is a wholly ternal Revenue, it is quite apparent, is deficient Gloves and mittens....
new subject. Until within the last few years, in executive force. It is impossible that the
Gold-leaf and foil...
32,000 we have made it our boast, justly and truly, Commissioner, however faithful and industri
Hemp and jute prepared for textile pur
that we were the most lightly taxed nation on ous, and I know of no man more so, should Hubs, spokes, felloes, wooden handles for
the face of the earth. Now we are compelled be able to consider all the complicated cases
tools and implements...
175,000 to confess that we are among the most heavily Hulls of ships and other vessels....
500,000 daily arising for investigation in the adminis
burdened of them all. This, sir, is one of the Income, increase of exemption from $600 to tration of his office, and we have conceded not $1,000.....
3,000,000 inany vast changes which have been wronght only the propriety but the absolute necessity Incomc, reduction from ten to five percent.
in our condition by the rebellion we have just
on sums over $10,000... of reënforcing the office by two additional
17,000,000 suppressed. We have incurred a vast debt
Iron advanced beyond pig, slabs, and loops deputies and one solicitor.
Iron, railroad rerolled....
582.000 consequent on the war for the suppression of Notwithstanding all the disadvantages we
2,000,000 that rebellion. have labored under in putting new and untried
426.000 Iron casting for bridges.
We have, moreover, provided, necessarily, laws suddenly into operation, it is gratifying Iron, malleable...
100,000 for a permanent increase, more or less considto find that the expense of collecting the revKeys, actions, and strings for musical in
erable, in the ordinary expenses of the Gove enue has been far less than was anticipated- || Lamps and lanterns...
ernment. Those expenses must be met year
50,000 including everything except printing done by Moldings for picture-frames, &c..
5,1900 || by year. The interest upon the debt must also the Public Printer-amounting, in 1865, to no
Mineral waters, &c...
125,000 be met as it becomes due; and I think it of the
Mineral coal of all kinds more than two and seventy-five one hundredths,
1,250,000 Metallic nickel, quicksilver, manganese,
utmost importance in all respects our credit, or two and three fourths per cent. This con- cobalt, &c.....
12,000 to our character, and to the courage with which trasts most favorably with the cost of collection Metallic zinc...
50,000 all burdens will be borne by the people, that in Great Britain, where, after years of experi
Masts, spars, and ship clocks.
45,000 Oxide of zinc...
we should lose no time in making a beginence, the cost varies from four and one quarter Paper, books, charts, and book-binding..... 2,072,000 | ning toward paying off the principal of that to five and three fourths per cent. Productions of stereotypers, electrotypers,
debt. It does not seem to me wise, sir, that The services of the gentlemen employed on
lithographers, and engravers..
we should begin to accustom ourselves or the the revenue commission, I have no doubt, are Plows, cultivators, harrows, straw and hay
creditors of the nation, the people upon whom properly appreciated by Congress, as they will cutters,planters, seed-drills, horse-rakes,
these obligations rest, to the idea that this debt be by the country, and the Committee of Ways
1,500,000 Paints and colors....
may be fastened upon us like the debts of Eng. and Means were unanimously, I believe, of the Puity.
1,000 land and of France, never to be paid through opinion that this kind of service should not be
Para fline oil and crude petroleum.
2,100,000 all time to come. entirely discontinued. Believing that at least
Quinine, morphine, &c.
The ordinary expenses of the Government, one similar officer can be profitably employed Railroad chairs, ship-spikes, ax-poles,
as they are estimated by the Secretary of the permanently, they have added a section to the horse-shoes, rivets, horse-shoe nails, bill for this purpose, and I have no doubt it will
nuts, washers, bolts, vises, iron chains,
Treasury in his report, laid upon our tables at anchors, anvils.....
the opening of the session, are $143,000,000. prove wise economy to adopt and continue it Roman and water-cement and lime.......... 144,000 The interest to be paid during this year is fixed so long as we may be compelled to raise any.
100,000 at about the same amount, some two millions
Soap thing like our present revenues from taxation.
less. Both these sums, I think there is reason The military power of the United States Spelter...
10,000 || to suppose, may be somewhat reduced. The needs no eulogiums from any quarter. Its Saleratus, soda ash, caustic soda, crude
expenses of the Army and Navy are not likely
soda, bicarbonate of soda, &c..... supremacy at home is not likely to be ques
50,000 Sulphate of barytes...
to be as high as they were originally estimated; tioned, and when it is challenged elsewhere it Spindles and castings for locks and ma
and the amount which will be due for interest will be time enough to answer back. Its finan
300,000 Stoves in part of cast iron and sheet iron
will be somewhat reduced by the fact that the cial power, also, even in the agonies of civil
50,000 | Secretary of the Treasury is not likely to fund strife, has been vindicated. No of dis- Sails, tents, awnings, and bags...
125.000 so much of the debt now bearing no interest as honor rests upon its credit. Every promise
25,000 has been kept with entire good faith. No credUmbrellas and parasols.
it was originally supposed he would. But these
111.000 Vegetable, animal, and fish oil.
two sums, taking them at his estimates, make itor, holding the obligations of the nation, has Value of bullion used in wares and in
the considerable amountof $284,000,000, which had to do more than to ask and receive. No
will be required to meet the expenses of the
50.000 faithful soldier has closed his service without White lead and whiting..
Government and the interest on the debt for receiving at the same moment with his honor- Yeast powders...
one year. able discharge the last dollar due. Is there,
Yarn and warp.
I think we ought also to begin at once to then, any lurking danger as to our present and
5,000 make some provision for paying the principal future financial condition? The confidence of Slaughtered animals..
1,200.000 of the national debt. I do not think it would the people in their own Government cannot be
1,350,000 Schedule C (receipts)..
be wise for us to provide less than $50,000,000
200,000 shaken; the vigor and elasticity of American
4,850,000 per annum for that purpose, the sum to be industry is unrivaled; our resources, abundant Salt...
increased from year to year as our system of to-day, will be greater to-morrow; no empire,
300.000 Steam-engines, &c...
taxation may be perfected, and as the industry ancient or modern, ever received, daily or Tobacco.
650,000 may gradually adapt itself to the new burdens annually, revenues of equal magnitude, and Brokers' sales.
500,000 which are imposed upon it. This would make the wealth hidden in some of our single mount
50,000 General tax reduced from six to five per
an aggregate sum of $334,000,000 to be provided ains, if it could be placed in the balance, would cent.....
12,000,000 annually toward meeting the expenses of the make our national debt kick the beam. Where, Telegraphs......
125,000 Government and the interest and installments then, is the cloud no bigger than a man's hand? It rises only in that quarter from whence dis
on the principal of the public debt. This sum will be required annually, without any serious
diminution from year to year, until we shall year these were $84,000,000. The Secretary ern part of the State of New York, [Mr. Holhave paid off so much of the principal of the of the Treasury estimates them for the coming | burd,] then chairman of the Committee of public debt as will allow us to estimate the year at $100,000,000. I confess I cannot see Ways and Means in the Assembly of New York, interest at a sum considerably less. It will of the data upon which estimates so low as either will remember how universal the cry came to course be growing less and less from year to of these sums can be properly based.
us, as it went to Congress also, that taxes year. Three hundred and thirty-four million Mr. MORRILL. I referred to the estimate should be increased and that the country should dollars, in round numbers $350,000,000, is a || for the year ending the 30th of June, 1867. pay the expenses of the war as it went along very large sum for a nation to pay annually. Mr. RAYMOND. So I understood. The instead of resorting to loans. Naturally enough It is very large for us, in consideration of the
estimate of the Secretary of the Treasury is | Congress responded to that demand. It refact that it is so much larger than we have ever for the same year.
sponded at once, and necessarily without much before been called upon to pay or have any per- Now, Mr. Chairman, down to the year 1861, consideration. The laws of industry and of fected machinery for raising the means to pay. for the five years immediately preceding that political economy were but little regarded. The aggregate revenues of Great Britain
year and the commencement of the war, the Congress issued its decree that everybody and during the last year were but $354,000,000, imports averaged about three hundred and fifty | everything should be taxed in every way. and those of France but $350,000,000.
million dollars. I am sure they will not be Upon all the processes as well as the products A MEMBER. Dollars or pounds?
less than that from this time forward. Our of industry, upon all work, and upon all tools Mr. RAYMOND. It is reduced to dollars. imports are always measured by the amount | by which work was to be done, upon all classes So that the three great nations of the world of our exports. Our capacity to buy usually and conditions of men taxes were imposed with. are substantially upon the same footing so far determines the amount we do buy. We are out stint and without precaution. Every branch as the annual taxation imposed upon their peo- | bringing into direct contribution to our com- of trade, every kind of manufacture, raw mateple is concerned.
merce a larger extent of country than ever rial and net results-everything that could be But we have the advantage of these nations before. A million and a half of men are going made to pay was swept along in the vast dragin some respects, although both their popula- || from the field into productive pursuits. The net of that first tax bill. tion and their aggregate wealth are somewhat South is soon to be open to commerce, and the Now, while the people paid these taxes with in excess of ours. We have a free Govern- South will produce largely with proper encour- the greatest alacrity and readiness, we must ment, a Government which allows to every one agement and aid at the hands of the Govern- not fall into the error of supposing that such a of its individual members entire and perfect || ment; and I was glad to hear the chairman of system could be endured permanently. As a freedom of individual action; and that, sir, is the Committee of Ways and Means refer to this temporary necessity, they have borne it with a a source of energy, of enterprise, of industrial as one of the great reliances of the country for | degree of courage and patience that could never vigor and elasticity which cannot well be over- revenue, namely, encouragement of the indus- have been exhibited by any other people on rated. Nothing more is needed to show the
try of the South, and aid in developing the the face of the earth; and this is not an empty effect of this great principle of freedom upon resources of that rich and productive region. national boast-it is conceded by the highest the industry of a nation than a comparison of Now, sir, with all these sources of produc- || authorities of England, that in this as in many the rate at which the wealth of these three tion I am sure we can fairly estimate our other things the people of the United States nations has increased during successive dec- exports for the next year and for a series of || have proved themselves entirely a people by ades. I have not before me, nor have I in years to come at not less than $400,000,000, || themselves. mind, the exact proportion of increase of pop- and our imports will be at least as large as they The London Economist, perhaps the highest alation of Great Britain and France to the in- were during the five years previous to 1861. financial authority in England, in speaking of crease in their aggregate wealth. Our own has | What, then, will be the probable revenue from the taxation through which the United States been very great. The increase in our wealth customs? The present average rate of duty I have passed during the last four or five years, has been in much more rapid ratio than the believe is something over forty per cent., prob- says that “no other nation would have enincrease of our population. During ten years, | ably nearer forty-five than forty. That is not dured a system of excise duties so searching, ending in 1860, the increase of our population likely to be reduced, and it gives us onc hundred so effective, and so troublesome." And it adds, was but thirty-five per cent., while in the aggre. and forty millions. 'Indeed, the further imposi- that "to have imposed such taxes in England gate wealth of the nation, it was one hundred tion of these domestic excise duties will ren- would have caused a revolution." and twenty-eight per cent. This is three times der it indispensable that we increase the duty And it is to the eternal honor of the Amerithe disproportion which obtains either in Eng- on foreign imports in order to keep the balance can people that in this, as in everything else land or France.
even between foreign and domestic duties. connected with the salvation of their country, And more than that, our annual income is But, sir, without going into any intricate or they have responded nobly to the calls of the greater than theirs—in a much larger propor- close calculation on this subject, I adduce these Government. But this, as I have said, was tion. We have sources of wealth, moreover, facts merely to show that the estimate of the from the necessities of the case a temporary sources of fresh vigor, sources of industrial Secretary of the Treasury, $100,000,000, is || provision. It became necessary, and the last productiveness to which none of the old nations | exceedingly low, and that it is more likely to Congress foresaw the necessity, to make proof the world can make the least pretense. Im- be one hundred and fifty millions than one vision for some permanent arrangement and migration for one, and it is the only one I will || hundred, at the rate at which imports are system of internal duties. The first step which mention, is itself a source of productive labor coming in now.
it took was a judicious step. It was to follow which cannot be estimated at less than two or Estimating the custom duties at $100,000,000 the example of that nation which has had more three hundred millions dollars every year. will leave $250,000,000, or a little less, to be | experience of internal taxation than any other,
I refer to this to show that our debt, great || raised by domestic taxation. This bill now on Great Britain. Great Britain always, in de. as it is, is not beyond our resources; it is our tables, upon which our action is invoked, vising ways of taxation, appoints commissions not greater than our people can bear. I may proposes to provide for this sum cach year for or committees who take evidence carefully and add that it is not greater than they will bear the expenses of the Government. Now, it is elaborately; for taxation, even more than the cheerfully and readily, because it is a debt in- idle to conceal from ourselves the fact that this ordinary action of government is an expericurred by the people themselves, and for the is a grievous burden, and it will always be felt mental science-purely deductive in its nature. people themselves, for objects and blessings to be a grievous burden by the mass of the There are no general principles which will inthey have in hand to-day, and will have through people upon whom it rests. No matter how struct any nation as to the specific taxes it may all time to come.
great may be their alacrity, no matter how impose. It must inquire into the facts and be Now, all we are asked to do—all the people determined may be their purpose to pay it, no governed by them. " It must scrutinize each ask us to do in adjusting this great burden, matter how ready they may be to sacrifice all particular branch of industry, its bearings on which is to recur year after for many years to they have in maintaining the honor of the all others and the bearing of the whole on the come—is that we shall adjust it so the people nation, it will still be felt now and always as a welfare and prosperity of the nation; and the may bear it easily; that we shall adjust it so serious burden; and the extent of its weight || system of taxation must be suited to the emerthat it will not cripple those energies upon will depend upon the manner in which it is gency in each particular case. which we rely for its payment; that we shall distributed among the different classss and Congress authorized at its last session a comput it where they can bear it best, and not || pursuits of the country.
mission of three gentlemen familiar with the where it will rest heaviest upon them; that Now, this is entirely a new subject for us. subject from theoretical study and capable of shall put it upon their back and not upon their We have had no experience in devising ways making personal investigations of the facts
and means to distribute duties upon domestic relating to it. Those gentlemen have been There are two great sources from which we articles, so as to make them rest more or less engaged with assiduity, and intelligence, and, I have to meet these expenses. One is the cus. lightly upon the mass of the people. The task | think, with a degree of success far greater than toms, duties imposed on imported goods, and was thrust upon us suddenly. The war came could have been predicted, in investigating the the other is excise duties, or duties imposed | upon us suddenly, and with the war came taxes, whole of this great and novel subject. They on goods of our own production. Both of out of which its expenses could alone be met. have collected a vast body of evidence, which these must be drawn upon from year to year. When the rebellion came upon us we all know || I am sorry to say has not yet been printed and What either will amount to must be the result how eagerly the people demanded that taxa- delivered to Congress for its instruction, but of estimates. The chairman of the Commit. tion should pay the expenses of the war for the summaries made from it and published tee of Ways and Means, in the statement he its suppression. Their determination to rescue from time to time must have done much to has just submitted, estimates the receipts from the Government from the peril that threatened enlighten all those members who wish to uncustoms at a sum less than that of last year. it prompted them to demand that taxation derstand the subject in its details and the action He looks forward, if I understood him aright, || should be resorted to as the means of produz. l proper to be taken. to a diminution of the duties on imports. Last Il cing that result. My colleague from the north it Now, all that I propose to do upon this oc
casion is to recur briefly to two or three gen- a more subtle form of protection. Instead of any better condition than that in which he eral principles which I think should guide us taxing and excluding the goods of other na- ought to live. The Government should not in acting on the tax bill which is now before | tions, inasmuch as they went to the markets trench upon the necessities of the great mass us. In imposing taxes upon domestic industry the ports of which she could not control, she of its people. The absolute necessities of the there are certain great principles familiar to all
very wisely reduced the cost of producing her people should be spared, should be held sacred readers of political economy which it will not own goods. That is a principle of universal from the hand of the tax collector. The peobe wise for us wholly to neglect. We are to application, one that we should apply just as ple should be allowed to enjoy undiminished so impose taxes upon a great variety of articles. | rapidly as we can; for the same reasons that much of their earnings as they need to supply The present law, as I have said, taxes every- make it applicable to England make it appli- | those necessities. thing. We seem to be almost in the condition | cable to us.
In regard to the income tax, I observe also of England when she first began her system of When we perfect our system of internal taxa- that the committee recommend a repeal of the taxation, so amusingly described by Sidney | tion; when we get it to a point where it will extra five per cent. on income over $5,000. Smith, when every Englishman came into the conform to the fundamental principles of polit. Incomes to the amount of $1,000 are to be world' by the aid of a doctor who had paid a ical economy, the whole of this long list of wholly exempt. The amount of income above tax, and that lie paid all the way through life, | manufactured articles that now figures on our $1,000, up to $5,000, is to be taxed at the rate until he was finally buried in a taxed collin, in tax bills will disappear, and we shall have left of five per cent. By the present law an addia taxed grave, and by an undertaker who had simply taxation upon the results of industry- ||tional tax of five per cent. is imposed on all paid a tax; and it was then, and then only, that upon the profits of labor; in other words, so over $5,000. I know that theoretical writers his taxation ceased.
far as the result of manufactures go, we will insist that it is anjust and impolitic to impose Now, I do not suppose that we can reach have taxation upon incomes alone. I consider a graduated income tax; that every man should a full and thorough compliance with all the incomes to be the fairest of all subjects for tax- pay the same percentage on his income, whattheoretical principles of taxation laid down by ation, and I was a little surprised to hear the ever its amount may be. But there is this fact the writers on political economy; but we can chairman of the Committee of Ways and Means which, it seems to me, ought to be considered : keep them steadily in view, and we ought always | [Mr. MORRILL] apologize for continuing the that the second $5,000 of a man's income is to aim to come up to them as perfectly as pos- income tax a little longer. It seems to me that generally much more easily earned than the sible. In the first place, it is always desirable income is the first thing, so far as industry and first $5,000, when any business is entered upon to impose taxation upon the results of industry the products of industry are concerned, which that will insure large profits. Certainly a man rather than upon
its processes. The processes should be taxed; for in taxing income you tax can better afford to pay a second tax on all of the manufacturer, the tools of the manufac. that which a man has and nothing else, and over $5,000 than to pay a heavy tax on the first turer should not be taxed, but the results of that too in exact proportion to the amount of || $5,000 of his income. I confess that I do not the manufacture, when they make their appear- what he has.
think it wise, in the present state of the counance, in profits and income, are proper subjects If you encourage your people in their labor, ll try, to exempt the second $5,000 of a man's of taxation. When a man is endeavoring by in manufactures, in producing wealth, then income from a second tax. I know that this labor to produce certain products he should after they have produced it and have the net may fall heavily upon portions of the communot be taxed in his efforts, in his labor, but proceeds in their pockets, it is quite just and nity, but fortunately they will be those portions only in the result, the products of that labor. fair and proper for the Government to claim a of the community which can best afford to bear
It is a very commonplace maxim, but a very proper share of those profits to meet its own it, and those portions of the community, I will true one, and one to be borne in mind in all necessities. But the industry of the nation add, which have thus far borne all taxation these economical discussions, that labor is the should be left unfettered; or if fetters have with the utmost readiness, and which show no source and the only source of national wealth. been imposed upon it, it should be allowed signs of complaint at the taxation to which Productive industry feeds all the sources of to regain its freedom at the earliest possible | they are subjected. Even if it should be deemed national wealth. It is the fountain from which moment.
wise to reduce somewhat the percentage of tax we draw all the moneys we need for maintain- Of necessity, there are exceptions to this on the second $5,000 of income, I hope the ing the Government or for any purpose what- rule; and cases where it cannot be at once and House will not think it wise to release it from
If we tax the processes of production | fully applied. Cotton is undoubtedly one ex- extra taxation altogether. we tax the fountain-head, and thus diminish || ception. In my judgment, it is proper to im- The same principle of taxing superfluities the ability to keep up the supply. It is rather pose a tax upon cotton; and I think the rate and incomes instead of necessaries applies to the duty of the Government not to diminish || proposed by the committee is not too high. the taxation proposed upon commodities, upon the force of this productive industry, but to However, that question will come up for more beverages, upon articles consumed. I know stimulate it, to aid it, to increase it.
careful consideration when the bill comes to that it is somewhat difficult, theoretically, to Suppose a man is engaged in the manufac- be examined by sections. I refer to it now, define what are necessaries and what are suture of engines or anything of the kind, like | merely to say that although the tax upon cot- perfluities. What is a necessity to one man is our friend from Massachusetts, [Mr. Ames,] ton may seem to be an exception to the gen- a superfluity to another, and what is a superwho is so largely engaged in the manufacture eral principle I have laid down, yet the fact fluity to any man at first becomes soon a neof axes, shovels, and other agricultural imple- that cotton is a monopoly of this country, and | cessity of life. But at the same time there are ments, it is not wise to tax the processes of must be bought from us by all other manu- certain things which are used merely to gratify that manufacture, either in respect to the raw facturing countries, takes it out of the cate- artificial tastes; and such things, I think, inay material that used or the tools that are emgory:
very properly be called superfluities of life. ployed or the food of the workmen that are It is not, for example, like iron. England | And among these all nations recognize dishired. All those things should be as nearly has iron, and we have iron. We cannot, there- tilled spirits, whisky, fermented liquors, tofree froin taxation as possible; but when the || fore, tax iron in the raw state, as we may tax bacco, and to a certain extent, tea and coffee. net results, the profits, the income, are pro- cotton. Should we attempt to do so, we should | These, especially distilled spirits, are always duced, they are the legitimate subjects of tax- expose ourselves to unfair, unjust, and injuri- made the subjects of heavy taxation. ation, and may be levied upon accordingly. ous competition on the part of England. But In England distilled spirits are heavily taxed,
And that, in my judgment, is what is really if we tax cotton England must pay the tax and yield a very large portion of the revenue. involved in what is commonly called the free- also.
Four of these articles-sugar, tea, tobacco, and trade policy of England. England found her. But, not to dwell upon this point, the next spirits-yield $97,000,000 out of $112.000,000 self in a condition when her main and essential | principle to which I ask attention for a mo- received from customs in England; and licenses, interest was the manufacture of goods for the ment is that we should tax, so far as possible, malt and spirits, yield $92,000,000 out of markets of the world. She had to compete | the superfluities and not the necessaries of $97,000,000 received as excise. They are with other nations in those markets; and she life. In the application of this principle to always resorted to, and bear a' very large found it absolutely indispensable for the pro- income is, I suppose, to be sought and found | proportion of the burdens of taxation. Our duction of those goods at such a rate as to en- the justification of the exception of a minimum own tax bill aims at the same thing and goes able her to successfully maintain that competi- which is always made. In England, where an upon the same principle. Under the law now tion to relieve her manufacturers from taxation income tax has come to be one of the fixed upon your statute-book whisky is taxed two upon everything that entered into the processes taxes of the country, and will never be re- dollars a gallon, and in England it is taxed of production. She took the duty off raw cot- pealed, at least while she needs so large a rev. $2 50. There is no rate upon these articles ton because she needed raw cotton for the goods enue as she now does, I believe the tax is six- which can be so high as to be objectionable. she manufactures. She took the duty off corn, pence to the pound, and £100 of income are On the contrary, the higher the tax the greater for she needed corn to feed her workmen, and exempt from taxation. The cost of living in the indirect benefit in diminishing consump: by taxing corn she obliged the manufacturers this country is somewhat higher, and espe- tian, for all concede that a law which should to increase the wages of their workmen to pay | cially for the working classes it is very consid. || largely increase the domestic use of spirits as the increased cost of their support. And so erably higher. Our present law exempts $600 a beverage would not conduce to the welfare everything that entered into the working of her of income from taxation. The committee rec- and morality of the nation at large. looms, her forges, and her machine-shops was ommend that the amount exempted be in- The only limit, in my judgment, to the amount relieved from taxation.
creased to $1,000, and in this I think they have l of duty to be imposed upon whisky is the It is idle to call that policy free trade. As recommended wisely, although it will subtract | practical enforcement and collection of the tax. it is very properly said by the commissioners | $3,000,000 from the revenue in the aggregate. There we encounter a serious difficulty, for if of internal revenue in their admirable report An exemption of $1,000 will be but a just ex- we put the tax so high as to make the profit on upon this subject, and as it had been remarked | emption. That amount will not maintain a illicit distillation very great we shall tempt or before by some French economists, it is only 1l working man and his family in this country in force men into that illicit distillation. I sup
pose the cost, the prime cost, of producing of two dollars, until or unless the proposed of bone, ivory, or horn, then the brass tube, then whisky is about twenty-five cents a gallon, tax of two dollars is better enforced and more the elastic band of rubber, then the silk tassel, and when you put a duty of two dollars on that rigorously collected.
then the button and the cap_each of these the profit on every gallon a man can sell in I have dwelt longer on that point than I may come from a different manufactory and is evasion of the law becomes immense. If we intended. Tobacco is another article which subject to a separate tax; and when they are get the duty so high as to lead men to see that | demands careful attention, and it is one of the all brought together and made into an umbrella such enormous profits can be made we shall || superfluities which can be heavily taxed. then they are taxed again. render it certain that this illicit distillation will But the next principle I desire to refer to, More than that, the manufacturer of each be largely resorted to. This has been expe- and I think it will be the last, is this: that one of the various items composing the whole rienced everywhere. There is but one way to taxes should be imposed upon as few articles avails himself of the fact that the article is prevent it, and that is by the enactment of as possible. A tax is a blow at best. It is a taxed to add to the price of that which he sup. severe and rigid laws. We must have one of hurt, an injury inflicted upon somebody by the || plies, and not only to the amount of the tax, two things: either the tax shall be so low as Government. It must fall somewhere, and but so as to give him a little additional profit. not to tempt men to go into illicit distillation, wherever it falls it will create complaint and He takes advantage of the tax to increase his or the law must be so severe that they will not || produce injury. It is therefore evident that profit. It is so in every department of busido it.
it should fall upon as few as possible. The You find that the price of everything is Since the original internal tax law was en- expense, moreover, of collecting the revenue raised, and raised beyond the amount of the acted, we have made various experiments in depends far more on the number of articles tax imposed upon it. They manage the matthe tax on whisky. I believe it began at twenty taxed than upon the amount of the aggregate ter pretty much as the owners of the city rail. cents a gallon, then rose to sixty, then to $1 50, collection. Our present tax law imposes duties road cars did when they were authorized to and then to two dollars. I do not know whether
upon a great variety of employments which add to their fare the amount of the tax. The any one of these taxes continued long enough to scarcely pay the expenses of collection. Take | amount ofothe tax was one fifth of one cent, enable us to arrive at any general inference as all the small trades, the tailor, the shoemaker, and they added one cent. And it is so in all to the rate that would yield the largest returns. the milliner, the dress-maker, all the small departments of business. It is in human naIt is certain that the present tax of two dollars || traders of that sort, and you will find that the ture, and we cannot by any act we can pass is promoting illicit distillation to a degree | amount of tax imposed upon them scarcely | here expel human nature from the masses of which threatens the collection of any revenue pays the expense of collection.
our people. whatever on whisky. In one single collection In a note to one of the pages of the report Now, apply this rule to all the products of district in the city of New York, where two of the commissioners of revenue is inserted an manufacturing industry. Consider that, on all years ago there was not a single distillery, there extract from the books of one of the tax col- these processes this duplication is going on, are now thirty illicit distillers in cellars and lectors in the city of New York, from which it and that each man adds something in addition out-of-the-way places, each making whisky, appears that there are many milliners, dress- to the tax to his part, and you will see a much from one to five gallons a day, on which, of || makers, manufacturers of cloaks,&c., whose more potent reason for the enormous prices course, they pay no duty and make an enor- monthly taxes amount to $1 04, another to that obtain to-day for everything than is to be mous profit. I understand that in one district || $1 20, in another to $1 58, in another to $1 75, found in the high price of gold. Why did not the of Virginia, in the neighborhood of Richmond, and in another to only forty-two cents, &c. 1 || price of everything fall when gold fell from 280 where there were no distilleries two years since, I need not say that this scarcely pays omnibus fare to 130? Simply because the price of gold and there are now three hundred making whisky to collect these taxes. All these and all like the inflation of the currency had comparatively in evasion of the law. And in the State of them should be, it seems to me, dismissed from little to do with the exaggerated prices at which Georgia, where there were but few a short time the tax bill at once.
all articles were held, not nearly as much as ago, there are now fifteen hundred.
So I think in regard to all manufactures of the fact of the duplication of taxes, and the How is this to be remedied? It can only be articles of indispensable necessity for the great exaggeration of profits which followed upon it. done by making the law so stringent that it mass of the community. Clothing has been Now, by abolishing all these taxes on manuwill not be evaded. That is almost impossible taxed five per cent. during the past year, and factured articles the tendency would be to corin this country. The English Government has the chairman of the committee reports this rect this most serious evil. When England succeeded by looking into the detail of every year & reduction to one per cent. Now, one began her system of internal taxation, the list man's business, by having an inspector in every per cent. will simply vex the producers and of taxed articles was enormous; everything she man's distillery. In our country the facilities || yield very little revenue. Clothing is an article had was taxed, and taxed roundly; but gradfor evasion are so great that it is impossible to of universal use; it is consumed by all classes. | ually, year by year, she has gone on reducing provide these remedies. I do not know what But any considerable tax upon it must operate the number of articles on which internal taxes particular remedy the committee has recom- unequally, because the poor man or the man are imposed. mended, but I cannot think of any likely to be in middle life wears just about as much clothing Her internal revenue now amounts to more effective than a very heavy license tax and as the rich man, and has to pay substantially || $161,000,000. It is drawn from three great a very severe punishment für evading the law. the same amount of tax.
excises, stamp duties, and assessed If none are allowed to distill except those who It seems to me, therefore, that we could taxes. The excises amount to $97,000,000, pay a heavy license, all who evade or defy the relieve the great mass of the community from and of that sum more than ninety millions are law may be subjected to severe punishment. that tax without interfering materially with the raised from three articles, and there are but Large distilleries are willing to pay a license revenue. Last year it yielded something like nine articles embraced in her whole list of as large as may be demanded, provided they six million dollars. This year it would no excise duties. So, too, of her stamp duties. can be protected against illicit distillation. doubt yield much more at the same rate. But Her assessed taxes amount only to $10,000,000 But how many of these same large distilleries at one per cent. it will yield but little. And if a year in all, and of these one half are raised which pay the taxes on their products have no one else does so, I shall submit, at the proper from two items inhabited houses, and carbeen forced to suspend. They cannot pay the time, an amendment to the bill to strike out riages. This shows that a reduction of the tax of two dollars a gallon and carry on their clothing from the list of taxable articles alto- number of articles taxed is quite consistent with business in competition with illicit distilleries || gether. So, I think, taxes upon paper, upon an increased aggregate amount of taxation, all over the country, which make and sell their type, upon books, and upon newspapers as provided the distribution is properly made. whisky and pay no tax whatever. This House taxes upon knowledge, and taxes upon adver- By nursing the great sources of internal revehas to choose, after deliberation, between these tisements as checking free interchange of com- nue, by imposing taxes only where they can be two things: either to reduce the tax on whisky munication on business matters, and taxes upon easily borne, by putting them on superfluities, so as to destroy this enormous temptation to insurance and savings as tending to discourage || by not taxing processes, but income, we should illicit distillation, or to enact laws so stringent prudence and forethought; and all other taxes, obtain the means, gradually, of reducing more as to prevent the evasion of the law and the of which these are samples, should be swept and more the number of articles upon our list entire destruction of those who pay the tax. away as speedily as possible.
for taxation. I believe the manufacture of whisky is not The effect of our present system of imposing Now, sir, I do not go into any examination less than from forty to fifty million gallons a taxes upon every article that is manufactured, of other items of this bill. These are the main year. Last year it reached the enormous and upon every part of such article, is very ll principles which I think it would be well for us amount of eighty million gallons, as the chair- || important in increasing prices by duplicating to bear in mind. man of the committee has just stated. But | taxation. I will not dwell upon this branch But, after all, nearly everything will
depend forty millions may probably be regarded as the of the subject, which you will find discussed upon the administration of the law. There is minimum production of the country. At two clearly and fully in the report of the revenue no department of law in which administration, dollars this would yield $80,000,000, and at || commissioners to which I have referred. execution, rigid execution, careful execution, one dollar it would yield $40,000,000; but cer- They cite the instance of an umbrella as an honest execution, is so important as it is in tainly, as the law is now enforced, it is not illustration. Formerly an umbrella was made connection with our internal revenue. If it is likely to yield even half of that amount. This at a single manufactory. Now it is made by honest, vigilant, and correct, revenue can easily matter should demand careful attention, and || putting together the various parts, each made be collected so as to yield large returns. If it I trust the House will act upon it with due and by a different process and each payiug a sepa
be lax, negligent, and still worse, if it be corsole regard to the interest of the revenue. rate tax. The stick of wood is one article, rupt, there is no end to the losses which the The commissioners of revenue are of opiuion, || part domestic and part foreign, the foreign || Government will sustain. With a rigid system I believe, that one dollar per gallon will actu- article being already taxed. Then the wire of collection, which involves the necessity of ally yield more revenue than the proposed tax comes from another establishment; the handle ll employing capable men at remunerative prices, and having a good, efficient, and energetic staff, There is a great deal of machinery connected said also with regard to the exemption of without reference to its cost—with such a sys- with it, for the same reason that there is a great $1,000 from income tax. The amount of tax tem the people of this country can bear all the || deal of machinery connected with this section exempted would be large to those who would burdens of taxation now imposed upon them, || levying a tax upon cotton. By referring to the have to pay it. This amendment proceeds or which any unforeseen emergency may here- || bill it will be seen that sections two, three, four, upon precisely the same principle which is after require.
and five, all long sections, relate to the collec- carried out all through the bill with reference I hope the House, in discussing this bill, will tion of this tax on cotton. There is necessarily to other products. The gentleman must see have due and careful reference to that fact, as a great deal of machinery connected with this that whoever finally pays the tax, the producer well as to the details of the tax itself. With a subject, for the reason that the collection of must get the benefit of just this five cents per proper adjustment of this law, to be made from the tax is provided for by a lien upon the cot- pound on the six hundred pounds. year to year, I am confident that this nation, ton produced, instead of, as in the case of Mr. MORRILL. I desire to say one word with its resistless enterprise, its boundless re- manufactures, relying for the payment upon further with reference to this amendment; but sources, its rapidly increasing population, will the responsibility of the manufacturer. l'his before doing so, I will move that the commitmeet the emergency for which it is now required || amendment is intended simply to encourage tee now rise, as I wish to submit a motion to to provide with the same degree of honor and the small producers by exempting this small close general debate. success that has attended its conduct of the amount; thus following out the general spirit The motion was agreed to. war which has just been closed.
of the bill. I think there should be no objec- So the committee rose; and the Speaker havThe first reading of the bill having been tion to it.
ing resumed the chair, Mr. WASHBURXE, of Illidispensed with by unanimous consent, the Mr. MORRILL. Mr. Chairman, I trust nois, reported that the Committee of the Whole committee proceeded to reconsider it by sec- that the amendment proposed by my friend on the state of the Union, having had under tions for amendment.
from Maine [Mr. LYNCH) will not be adopted. consideration the Union generally, and parThe first section was read, as follows: In the first place, it will open the door through ticularly the bill (H. R. No. 513) to amend an That on and after the 1st day of July, 1866, in lieu a vast region of country for any quantity of act entitled "An act to provide internal rev. of the duties on unmanufactured cotton, as provided in an act to provide internal revenue to support
fraud. The owner of a large plantation, for enue to support the Government, to pay interthe Government, to pay interest on the public debt, instance, "might employ any number of men, est on the public debt, and for other purposes," and for other purposes, approved June 30, 1864, as each of whom would get the benefit of this approved June 30, 1864, and acts amendatory amended by the act of March 3, 1865, there shall be paid by the producer, owner, or holder; upon all exemption.
thereof, had come to no resolution thereon. cotton produced within the United States, and upon
In addition to this, I think the gentleman Mr. MORRILL. I move, sir, that when the which no tax has been levied, paid, or collected, a from Maine proceeds upon an entirely wrong House shall again resolve itself into the Comtax of five cents per pound, as hereinafter provided; and the weight of such cotton shall be ascertained
theory with reference to who pays the tax. On mittee of the Whole on the state of the Union by deducting four per cent. for tare from the gross
whatever is consumed here in this country we, upon the bill No. 513, all general debate upon weight of each bale or package; and such tax shall the consumers, pay the tax, and on whatever the bill terminate in one minute, leaving the be and remain a lien thereon, in the possession of
goes abroad we expect, of course, to compel | five-minute debate upon amendments. any person whomsoever, from the time when such cotton is produced as aforesaid until the same shall foreigners to pay the tax.
Mr. STEVENS. I rise to a point of order. have been paid; and no draw back shall in any case The amendment is so voluminous and opens Upon a bill which we are considering in this be allowed on raw or unmanufactured cotton of any tax paid thereon when exported in the raw or un
the door to so great a variety of frauds that I manner, section by section, is it in order to manufactured condition. But no tax shall be im- think my friend from Maine must on reflection close debate upon the whole bill? Can the posed upon any cotton imported from other coun- himself see the impropriety of its adoption. closing of debate extend beyond the pending tries, and on which an import duty shall have been
Mr. LYNCH. I desire to call the attention section? paid. Mr. LYNCH moved to amend the section
of the gentleman from Vermont, (Mr. Mor- The SPEAKER. General debate on the
RILL,] the chairman of the Committee of Ways bill can be terminated; but that does not inby adding the following: Provided. That any producer may procure an ex
and Means, to the machinery which the com- terfere with five-minute speeches for and against emption of not more than six hundred pounds of
mittee have found it necessary to provide, in amendments. The House cannot close debate cotton in any one year, as follows:
order to prevent frauds in the collection of entirely except upon the pending section. Upon exhibiting the same to the assistant assessor
this tax upon cotton. While the amendment The motion of Mr. MORRILL was agreed to. of the district where said producer resides and where the cotton was raised, at the place of production, and is somewhat lengthy in its provisions, yet the Mr. SPALDING. I move that the House making oath that he raised and now owns said cotton, only point of it is the exemption of six hun
adjourn. and satisfying the assistant assessor that his sworn dred pounds of cotton from taxation. Its · statement is truc, the assistant assessor shall fitly mark the balc or bales of said cotton with the numlengthy phraseology is designed to secure the
The motion was agreed to; and thereupon
(at twenty-five minutes past four o'clock, p. m.) ber of pounds, being not more than six hundred as Government against frauds in connection with ascertained by weight then and there, and with the
the House adjourned. following words: “Cotton produced in the assess
that exemption. If the honorable chairman ment district in the collection district in
of the committee will examine the provision -, and owned by him on the day of 18–. of the old law with reference to the exemption
PETITIONS, ETC. and exempt from taxation;" filling said blanks with
of manufacturers to the amount of $600, he will the designation of the assessment district and also
The following petitions, &c., were presented under of the collection district, the name of the State, the find that that provision is liable to the same
the rule and referred to the appropriate committees:
By Mr. BANKS: The petition of Nathaniel Swift, name of the producer and owner, and tho date when objections which he urges against this amendsaid exemption is so ascertained and marked thereon.
Moses Foster, William Chickering, W. 8. Slerers, ment. The only question is whether the prop. The assistant assessor shall give to said producer a
Samuel Merrit, Marcus Morton, and others, for certificate of such exemption setting forth the above
osition is so guarded that the Government will amendment of tax law on savings banks. facts, and also the place of production as ncar as can not be defrauded. I suppose the gentleman
By Mr. CONKLING: The petition of citizens of be, and the payment of his fee. He shall also make
Otscgo county, New York, asking passage of laws will agree that now when the labor of the South, regulating inter-State insurance. & full record of all such exemptions and transmit a transcript of the same to the assessor. The assistant the cotton-producing portion of the country, is
By Mr. COBB: The memorial of George Cottingassessor shall be allowed a fee of two dollars for all revolutionized, it is desirable that if this tax be
ham, in relation to his pursuit of the assassins of his services in each case of exemption, to be paid by
President Lincoln, dated May 4, 1866. the producer. Any person swearing falsely in pro
imposed on cotton, the small producers there By Mr. DELANO: The petition of J. B. Fellows & curing such exemption; and any person using or atshould have some encouragement.
Co., of Mobile, Alabama, praying indemnity for tempting to use the exemption certificate or marks Mr. GARFIELD. I desire to ask the gen
47,660 rounds of cotton taken at the capture of Moprovided for in this section with intent to procure
bile by the Government, sold at New York, May 13, cxemption for any other cotton than that which was
tleman a question: does he think that, if his 1865, for $14,298 in gold. lawfully exempted as such certificate and marks set amendment should be adopted, it would help
Also, the petition of Mrs. Martha A. Booth, widow
of Dr. William A. Booth, of Canton, Mississippi, who forth; also, any person selling or giving away, pur- in any way the man who raises only six hun. chasing or receiving such certificate or marks with
was a Union man murdered by the enemy, praying intent todefraud or to aid in defrauding the revenue dred pounds of cotton?
indemnity for losses of property by the war. shall be liable, upon conviction thereof, to a fine of
Also, the petition of Timothy Lyden, of West Virfifty dollars or to not more than three months' im- to the amount of the drawback which he would
ginia, praying compensation as wagoner in the quarprisonment. Under the provisions of this section no
termaster's department while he was in captivity and cotton in its unmanufactured state shall be exempt
receive--five cents per pound. It would help prison by the enemy. from taxation for more than ten months afterthe date him to the extent of thirty dollars on the six
By Mr. ELDRIDGE: The petition of citizens of of its marks or certificate of exemption. Any per- hundred pounds.
Dodge county, in the State of Wisconsin, for national
insurance law, &c. son, other than the producer named in the certificate and marks aforesaid, who shall subscquently to such
Mr. GARFIELD. The whole of this tax By Mr. HULBURD: The petition of H. R. James, exemption claim property in any cotton so cxempted, would eventually be paid by the consumer, not
and others, citizens of Oguensburg, New York, askby virtue of an ownership prior in date to such ex
ing an increase and an ad valorem duty upon foreign by the producer. The amendment would multi
flax imported. emption, shall forfeit all such cotton; and any cotton with reference to which the owner or his agent shall
ply greatly the number of those who would be Also, the petition of A. B. James, and others, citicommit any violation of this section shall also be tempted to swear falsely in order to escape the
zens of St. Lawrence county, New York, on the same forfeited.
By Mr. LONGYEAR: The petition of A. C. BlodMr. LYNCH. The object of the amend- Mr. LYNCH. I would say in reply to the get, and others, citizens of Ypsilanti, Michigan, askment I have proposed, as will be seen, is to gentleman that the same objection would apply
ing for a bureau of national insurance. encourage the smaller producers of cotton. to the whole bill, for it all depends upon whether
By Mr. ORTH: A pctition from James Heaton, and
others, praying for legislation on the subject of inis following the general spirit of this bill, which the machinery adopted is such as to protect surance companies. exempts all incomes of less than $1,000 a year. the Government against frauds in the collection
By Mr. WASHBURN, of Massachusetts: The petiIt also exempts all manufacturers of less than of the revenue. The amount proposed to be
tion of Josiah Brown, and 131 others, tobacco-growers
in the town of Deerfield, Massachusetts, asking forin$600. And the incomes of miners who do not exempted by the amendment is, it is true, creased protection against the importation of cigars. produce $1,000 are exempted from taxation. small; but the same might be said with regard Also, the petition of Charles Haywood, and 51 The amendment I have proposed follows out to manufacturers to the amount of not more
others, tobacco-growers of Gill and Northfield, for
the same purpose. that same general principle.
than six hundred dollars. The same may be Also, the petition of Lemuel Cooley, and 59 chers,