pluses on hand. I think it is due not only to these other companies, but to the people of the country, that this should not be an exception. So far as humanity is concerned the argument will apply as well to fire, marine, and accident insurance companies as to life insurance companies. It is as good an argument in one case as in the other.

The amendment was agreed to.

No further amendment being offered, the Clerk read the next section, as follows:

Transportation Companies.

SEC. 119. And be it further enacted. That there shall be levied, collected, and paid a tax of two and one half per cent. on the gross receipts for the transportation of passengers of every railroad, canal, steamboat, ship, barge, canal-boat, or other vessel, and stage coach or other vehicle, except hacks or carriages not running on continuous routes, engaged or employed in the business of transporting passengers for hire; and on the gross receipts of every tollroad, ferry, and bridge, authorized by law to receive toll for the transit of passengers, vehicles, and freight of any description, over such toll-road, ferry, or bridge. The tax hereby imposed shall not be assessed upon receipts for the transportation of passengers between the United States and any foreign country, but shall be assessed upon the receipts for such transportation from a place within the United States through a foreign territory to another place within the United States, and shall be assessed upon and collected from persons, firms, companies, or corporations within the United States, receiving hire or pay for such transportation of passengers: Provided, That no tax under the provisions of this section shall be assessed upon any person, firm, company, or corporation, whose gross receipts do not exceed $2,000 per annum; and that when the gross receipts of any bridge or toll-road shall not exceed the amount necessarily expended during any term of twelve consecutive months to keep such bridge or tollroad in repair, no tax shall be assessed upon the receipts during the six months next preceding: And provided further, That all boats, barges, and flats, not used for carrying passengers, nor propelled by steam or sails, which are floated or towed by tug-boats or horses, and used exclusively for carrying coal, oil, minerals, or agricultural products to market, shall be required hereafter, in lieu of enrollment fees or tonnage tax, to pay as an annual tax, for each and every such boat, of a capacity exceeding twenty-five tons and not exceeding one hundred tons, five dollars; and when exceeding one hundred tons, as aforesaid, shall pay ten dollars; and said tax shall be assessed and collected as other annual taxes provided for in this act.

Mr. SCHENCK. I move to strike out the word "preceding" and insert "succeeding." The amendment was agreed to.

Mr. SCHENCK. I move further to amend by striking out the words "and used exclusively for carrying coal, oil, minerals, or agricultural products to market."

The amendment was agreed to.

Mr. CORNELL. I move to amend by inserting in line five, after the word " passengers," the word "only."

The amendment was agreed to.

Mr. CORNELL. I move further to insert after the word "hire," in line eight, the words "and in lieu of all tonnage tax on steamboats or other vessels for carrying passengers." At present, besides the two and a half per cent., there is a tonnage tax imposed upon steamboats, while railroads only pay two and a half per cent. on passenger receipts. This seems to me unequal and unfair. I have in my hand the tonnage tax of one steamboat. It pays for tonnage tax, $870; for boiler and inspection, $165; for hospital fees, fifty-seven dollars; for license stamps, two dollars; while a railroad conducting the same kind of business pays simply two and a half per cent. I believe the tonnage tax which is imposed upon carrying passengers should be stricken out.

Mr. ALLISON. I do not know that I want to oppose the amendment. This tonnage tax and the other taxes have always, I believe, been imposed. I do not like to accept the amendment.

Mr. PIKE. Allow me to suggest that this tonnage tax now applies to foreign as well as American steamers. There is a bill now pending in the House, reported the other day from the Committee on Commerce, and is to be taken up immediately after the passage of this bill, regulating this very matter of the tonnage

tax.

I think it will accomplish the object of my friend from New York [Mr. CORNELL] much better than this amendment. The operation of this would be to take the tax off all the

A MEMBER. What is the law now?

Mr. TWICHELL. It is two and a half. It is certainly a discrimination against railroads. I do not propose to discuss the question of the reasonableness of my proposition. I am sure it will commend itself to the members of the committee. There is no reason why it should be as high as two and a half per cent. on the gross receipts.

Mr. SPALDING. I think this is right. There is no allowance for expenses.

Mr. SCHENCK. The present charge is two and a half per cent.; we have not increased it. Mr. SPALDING. That is too high.

Mr. SCHENCK. I am willing to submit to the House whether the tax ought to be reduced.

Mr. TWICHELL. It has been said that the railroads have all increased their fares. The road that. I represent has not increased the fare during the war or since.

Mr. HOPKINS. I am very glad to hear that there is one road that has not put up its fare.

Mr. BENTON. I move to strike out "two and a half" and insert "three." The railroads are raising their fares all over the country.

A MEMBER. It will only come back on the people.

Mr. BENTON. It is notorious that there is no more profitable business in the country than this. I yield to the gentleman from Ohio.

Mr. SPALDING. Very many of these companies, I know, after charging their expenses have nothing left with which to pay this two and a half per cent. on their gross receipts. No allowance is made for drawbacks of this sort, and they all complain that the tax is too high. I believe it has been so, and I think the reduction from two and a half to two per cent. is a reasonable one. I believe it would be satisfactory all around.

Mr. BENTON. Let me say, in answer to what the gentleman says, that if we can rely upon the information that we receive through the public press, where the Government has imposed the tax, it has been doubled and trebled by the companies and taken out of their customers, and they virtually have not paid one single cent of the tax. They have doubled and trebled and quadrupled the amount of the tax and charged it to their customers.

Mr. FARNSWORTH. And does the gentleman propose to increase it still further for them to make the people pay an additional amount?

Mr. BENTON. No; I do not propose to give them any such chance. I propose to tax them and limit them in the increase of their rates.

Mr. FARNSWORTH. In many of the States they are already limited by law in their rates

of fare.

Mr. BENTON. It has been asserted over and over again by the New York press, and I have never seen it contradicted, that where a tax of one per cent. has been imposed upon them they have imposed five and ten per cent. on their customers.

Mr. STARKWEATHER. I desire to say a word or two upon this subject. There is no tax on this whole list, it seems to me, which is so onerous as this. You tax the entire gross receipts, and the record shows that half the

companies in the country are to-day, after paying their expenses, receiving little or nothing for their investment. More than that, if gentlemen will look at it a little further, they will see that this applies to boats of every character on the lakes and rivers and on the sound. Take the large companies running on Long Island sound between New York and Boston and the intermediate places, and these companies with one single exception have been unable to make a living out of it. One of those companies collects perhaps five hundred thousand or a million dollars during the year and they are assessed on the entire amount, and with a single exception those large companies have made failures. The same thing is true to a great extent of the companies running on the rivers and lakes. Why? Because, after paying this extraordinary assessment, they have nothing to divide. I hope, therefore, that the amendment of the gentleman from Massachusetts will be agreed to. This tax is not only exceedingly burdensome to the railroad companies, but is exceedingly burdensome to the steamboat interest on our lakes, rivers, and sounds.

Mr. BENTON. I withdraw my amendment to the amendment.

The question recurred on Mr. TWICHELL'S amendment, and there were-ayes 49, noes 35; no quorum voting.

Tellers were ordered; and Messrs. TWICHELL and FARNSWORTH were appointed.

The committee divided; and the tellers reported-ayes 52, noes 45.

So the amendment was agreed to.

Mr. COBURN. I offer the following amend

ment:

Page 175, line twenty-eight, after the word "preeeding" insert the words "and that when the gross receipts of any street railroad company in cities and towns of less than seventy-five thousand inhabitants shall not exceed the gross expenses during any term of twelve consecutive months, no tax shall be assessed upon the receipts during the six months next succeeding.

The effect of that amendment is to put street railroads in towns of less than seventy-five thousand inhabitants upon a par with bridges and toll-roads. Such street railroads are kept in repair and run very frequently in small cities in the interest of the public rather than of individuals. The amount that the Government would lose by reason of the taking off of the tax, if the tax were taken off where the railroads do not pay, would be very small. There are not in the Union perhaps more than twentyfive cities to which this amendment would apply.

In the State of New York there are some thirty-six street railroads, and there are not five of those thirty-six that do not pay expenses. In the State of Pennsylvania, out of some twenty-six, there are only four that do not pay. And in the State of Massachusetts where there are twenty, there are but three street railroads that do not pay.

These railroads of which I speak are not all in places of less than seventy-five thousand inhabitants. In such places as Salem, Massachusetts; Troy, New York; Wheeling, West Virginia; Harrisburg, Pennsylvania; Indianapolis, Indiana; Nashville, Tennessee; and other places, street railroads are not paying institu tions. I think it would be a very great hardship if those companies are made to pay a tax of two and a half per cent. upon their gross receipts, in addition to their original outlay, and the expenses to which they are continually liable.

I think it is but right that these street railroads should be put upon an equality with tollroads and toll-bridges. The investment that has been made in a street railroad cannot be changed, should it prove to be unprofitable. Having once been built and equipped, it must be continued in operation, or the entire amount invested will be lost. As I said before, I desire to call the attention of the committee to the fact that the deduction from the revenue will be but little should my amendment be adopted, as it applies to those railroads only where the expenses exceed the receipts.

man from New Hampshire to give me, if he is able, the names of three horse railroads that have paid dividends within the last two years. Mr. BENTON. The gentleman asks me a question with regard to the business of these companies, in reference to which he must know I am not particularly informed.

Mr. GRISWOLD. The gentleman was giving facts, and I supposed he was conversant with the subject. I asked for information.

Mr. BENTON. I can mention the Pennsylvania avenue railroad in this city, and the railroads in the city of New Yok.

Mr. GRISWOLD. The gentleman is entirely wrong there.

Mr. PILE. I move to amend the amendment by striking out the words "in cities and towns of less than seventy-five thousand inhab. itants." If I can get the attention of the committee for a moment I think I can convince them that this exception, if made at all, should be made generally. The same facts and the same remarks stated by the gentleman from Indiana [Mr. COBURN] with regard to street railroads in small cities and towns apply to large cities. I know, as a matter of fact, that in my city not a single street railroad company has paid one cent of dividend within the last three years. The companies have multiplied their roads and increased the number of their cars for the accommodation of the public, until, as I am informed by persons having an interest in those roads, the gross receipts in most cases do not equal the expenditures, and in no case do they exceed the expenditures by a sufficient amount to enable the company to pay a dividend upon the stock of the road. And there is this additional reason for the extension of this exception to railroads in large cities that does not apply to railroads in the smaller cities. In the larger cities there are a great many poor people whose friends the street railroads are; persons who live remote from their places of labor; common laborers, who are dependent upon these roads for their means of transit to and from the place of their daily toil. These railroads in the large cities are kept up largely for the accommodation of the public. And thus far in my city, I know, these railroads have paid little or no profits to their owners or proprietors. There are not those extremes of poverty in the smaller cities and towns as a general thing, that there are inguishing condition. the larger cities. There are not in the smaller towns such large numbers of persons who are less able to pay their fare upon these roads.

If any class of railroads are to be excepted from this tax because they are an accommodation to the poor and to the common people, and because their gross receipts do not exceed their gross expenditures, I think the exception should apply to all roads where that fact obtains, and not be confined simply to the roads in towns and cities of less than seventyfive thousand inhabitants. I hope, if this amendment is to prevail at all, if we are to except any street railroads from this tax, if we are to put these railroads upon the same footing with bridge companies and toll-roads, that we shall extend the exemption to all of these street railroads alike.

Mr. BENTON. This is not the first occa sion, Mr. Chairman, when, in view of being subjected to taxation, individuals have suddenly become very poor, receiving no profits from their investments. Now, I do not believe any such thing, as has been asserted, that as a general rule these horse railroads, as they are termed, do not yield any profits. Undoubt edly there are exceptions to the general rule. But as a general thing you find men organizing themselves into companies and asking for corporate privileges for the very purpose of estab lishing these roads in all our cities and large

towns.

Mr. CULLOM. I desire to ask my friend from New Hampshire [Mr. BENTON] whether there is any horse railroad in the town in which he resides.

Mr. BENTON. No, sir; I am glad to say there is not. I think that these horse railroads, instead of being, as claimed, the friend of all who happen to patronize them, are in many cases their worst enemies.

Mr. PILE. On what ground?

Mr. BENTON. On the ground that frequently individuals, instead of walking as they might do, crawl into the horse cars to ride twenty, thirty, and forty rods. It has become so fashionable to ride in the cars that every. body must ride whether there is any necessity for it or not.

Mr. PILE. I am very certain that the poor people of our cities do not agree with the gen tleman.

Mr. GRISWOLD. I would like the gentle

Mr. BENTON. Unless the facts are much misrepresented the railroads in the city of New York are not only making money, but, being taxed one eighth of a cent on their fares, they imposed an additional charge of one cent on their customers, thus taking the tax, increased sevenfold, out of the pockets of the people. I also understand that in the city of Boston enormous profits have been made by these horse railroad companies, much larger profits than those of the regular railroads. If these roads are not profitable, I ask again, why is it that in our large towns you find men rushing to invest their capital in this business and establish new lines?

Mr. MAYNARD. Does not the gentleman know that we have been told here on the very best authority that the banks are in a languishing condition?

Mr. BENTON. I know that.

Mr. MAYNARD. And the patent medicine business has been represented to be in a lan

Mr. BENTON. Certainly.

Mr. MAYNARD. And the case has been the same with almost every other interest that has thus far come up for consideration. Does the gentleman expect the railroads to be in any more flourishing condition than these other interests?

Mr. BENTON. Not until after these taxes are settled upon. [Laughter.]

Mr. HOOPER, of Massachusetts. I suppose the gentleman from Tennessee [Mr. MAYNARD] considers a bank to be in a "languishing condition" when it pays a semi-annual dividend of only twenty per cent. [Laughter.]

Mr. LYNCH. Does not the gentleman from New Hampshire also know that the hotels at the White mountains are in a languishing condition? [Laughter.]

Mr. BENTON. Not by any means. They are, I am happy to inform the gentleman, in a very flourishing condition.

The question being taken on Mr. PILE'S amendment to the amendment, there wereayes 37, noes 35; no quorum voting.

The CHAIRMAN, under the rule, ordered tellers; and appointed Messrs. PILE and BEN

TON.

The committee divided; and the tellers reported-ayes 50, noes 47.

So the amendment to the amendment was agreed to.

The question recurred on Mr. COBURN'S amendment as amended.

Mr. ELA. I move to amend the amendment by adding:

Provided, That all railroads, steamboats, transportation companies or individuals who do a losing business shall be relieved from all internal revenue taxes.

The CHAIRMAN. The gentleman must reduce his amendment to writing, and send it to the Clerk's desk, before it can be entertained.

The question being taken on Mr. COBURN's amendment as amended, there were-ayes 37, noes 38; no quorum voting.

The CHAIRMAN, under the rule, ordered tellers; and appointed Messrs. ALLISON and JUDD.

The committee divided; and the tellers reported-ayes fifty, noes not counted. So the amendment was agreed to. Mr. TRIMBLE, of Kentucky. I move to

amend the section by striking out, in the twentythird line, the word "two" and inserting "six;" so as to make the clause read:

Provided, That no tax under the provisions of this section shall be assessed upon any person, firm, company, or corporation whose gross receipts do not exceed $6,000 per annum, &c.

Mr. Chairman, the object of the committee seems to be to protect the smaller class of roads, turnpike companies, &c., and while we recognize this principle it seems to me but fair and just that we should extend this exemption at least to companies whose gross receipts do not exceed $6,000. If there are any roads in which every section of the country is interested it is these little turnpikes that barely pay expenses. Where they collect from two to four thousand dollars, under the section as it stands, we tax the entire sum. In many parts of the country these turnpike companies are in a languishing condition, and have paid nothing to the stockholders. In my own State I do not believe there is a turnpike company that pays a single cent. Every one in the country is interested in keeping up these turnpike companies, and in having others built where the interests of the country demand them. I think, therefore, that a tax upon these roads is really a tax upon the people. I hope the chairman of the Committee of Ways and Means will consent to this exemption of $6,000 instead of $2,000. The entire country is interested in it. There is no one who invests in turnpike companies who expects to make anything out of them. This tax of two and two and one half per cent. deprives them of all hope of making anything out of their investments. My amendment will also relieve the little street railroads whose incomes do not amount to the amount I have fixed. It will also relieve small ferries, which the people of the country are interested in keeping up. I hope the amendment will be adopted.

Mr. SCHENCK. Mr. Chairman, I do not know whether it is likely to meet with success that any one should endeavor to oppose the railroad interest in this House. I am rapidly coming to the conclusion at which my friend from Tennessee [Mr. MAYNARD] has arrived, that every interest of the country, and especially of corporations, must be in a languishing and sinking condition. The moment you touch one of them you hear nothing but embarrassments, losses, and the impossibility of making profits. We have heretofore heard from our friend from Pennsylvania [Mr. SCOFIELD] of "the poor man's light," and from my friend from Michigan [Mr. FERRY] of "the poor man's lumber." The gentleman from New York [Mr. BARNES] told us about the poor man's medicines," which, in my judgment, are composed of two ingredients, half poison and half profit. [Laughter.] In their sympathetic souls they have no other desire than to help the poor man. No one thinks or seems to have any idea that the stockholders are men who desire to make money at all, or that they are at all concerned in being relieved from this tax. Let us see whether this sympathetic feeling is entirely for the poor man. Let us try these street railroads. With great ingenuity they succeeded a few years ago, and with greater ingenuity they succeeded in getting upon the statute book a provision

Is the

Mr. STEVENS, of New Hampshire. subject of street railroads now in order? The CHAIRMAN. It is not. Mr. SCHENCK. These street railroads managed to get upon the statute-book a provision, when they were charged two and a half per cent., which on their fare is one eighth of one cent, to charge an additional cent upon their fare against the people, and thus get seven eighths upon every passenger by reason of paying taxes; that is, they make money out of taxation. Now, sir, not satisfied with making money out of the tax, they wish to begin at the other end of the string, and take the tax off altogether.

Mr. PILE. I wish to say that so far as the street railroads of St. Louis are concerned

they have not added on an additional cent. Five cents is the standing fare upon every street railroad in the city of St. Louis.

Mr. SCHENCK. I hold in my hand a perfect wail from these street railroads. It is from two excellent gentlemen whom I know. They show by statistics in what a ruinous condition the street railroads are. None of them had made dividends or could make dividends in New York. When asked abruptly what the stock was selling for, they admitted it stood at 150 or 160, or at some high premium. They said that was the result of dealings in real estate which we had no right to take notice of. Well, that may be so; I dare say it is; but my impression is that when the organized aggregations of capital can be used so that the stock which represents that capital in the hands of the holders is kept above bar, so as to make it a good investment, they are not suffering to the extent to which they claim. And yet now that we come upon this subject of railroads I find we have waked up a very large feeling of sympathy-to call it by no stronger name-in this House, and that we can hardly do too much for these railroads. We were thought to be acting fairly toward them when we did not propose to increase their tax at all, while in regard to many other taxes there has been a process of equalization and increase. Yet these large corporationsI speak of railroads generally-which now pay two and a half per cent., if the amendment made to-day becomes a part of the law will pay only two per cent. And I believe one gentlemen thought if he could only get the floor he could bring it down to one per cent., such deep sympathy was there in this House for these suffering railroads. All I desire to say is, that while we do not ask to put a heavier burden on them at all than they have had heretofore, we shall hesitate for some time about coming to the belief that these corporations have suffered or are suffering so that we cannot at least keep up in some degree the present contributions which we require of them for the purpose of sustaining the Govern

ment.

[Here the hammer fell.]

Mr. JUDD. I move, as an additional amendment, to strike out "six" and insert "five." I have listened with a great deal of interest to the lecture of the honorable chairman of the committee, [Mr. SCHENCK.] It is generally pleasant to the House, and perhaps it is very well advised; but it seems to me that he is urging now upon this committee a principle which has not a basis of reason. The principle upon which all taxation is based, and upon which this bill is based, is that property should pay it, and that the revenues derived from property should bear their proportion for the support of the government. I do not believe the chairman of the committee would say that he intended by this bill, or any portion of it, to tax a man who is losing money, or to tax a man upon property that does not return him any sort of income, but the theory of taxation is that you take it from the man that earns more than his daily bread; you take from his excess and give it to the support of the Government. Now, sir, there is no reason why, when honorable members on this floor assert as within their personal knowledge that a certain branch of industry which is absolutely necessary to the existence of the people in a certain portion of the country is a losing business, that the stockholders derive nothing from it, and that it is kept in existence for the benefit of the masses of the people, any one should turn round and say that those gentlemen are advocating a special interest in this country.

Mr. BENTON. Will the gentleman allow me to ask if it is not very easy under the proposed amendment so to expend their income as to have none left over improvements and repairs?

Mr. JUDD. Allow me to ask the gentleman what is the population of his town?

Mr. BENTON. About five hundred voters. Mr. JUDD. In answer to the gentleman I

the assertion that with the exception of the other States on the Pacific slope and the Territories, there is no portion of the Union where the expense of travel is so great as it is there, not because they charge extravagant prices, but because our methods of conveyance are far more expensive than they are here in the East. Now, with this tax added on-I do not mean to say that that is the only cause, but with this tax added on the burden has become so great that in many instances it has broken up our stage routes, and the means of travel from point to point have been taken away from the people. I will give an instance of the difference of expense in different modes of travel. In going from Sacramento to my own town, I pay for the first forty miles in the cars $2 50; and then for the thirty miles in the stage I pay $4 50. I go the forty miles in two hours, and it takes seven hours to go the thirty miles. This illustrates the difference between railroad travel and travel by stage in the larger portion of the country.

A gentleman near me says, "Go afoot." I have heard of walking lines of stages, but I am not in the habit of walking so far. Sir, the more money we have to pay for traveling on these stage-coach lines in California per hundred miles the more tax we have to pay, the passengers have to pay this

first, and who would have to walk six miles to his place of work, needs this method of transportation. And after his day's labor is ended, when he has toiled eight or ten hours as hard as he can for the support of his family, my friend from New Hampshire would have him, before he takes his frugal evening meal, repeat that walk of six miles. I tell you this is a tax which we do not propose to impose on the laboring men of our region."

[Here the hammer fell.]

Mr. ALLISON. I oppose the amendment to the amendment.

Mr. JUDD. I withdraw it.

Mr. ALLISON. I move that the committee rise for the purpose of closing debate on this section.

Mr. INGERSOLL. Before that is done I wish to offer an amendment.

Mr. ALLISON. Amendments will still be in order.

Mr. INGERSOLL. But I want to debate it. The question was taken on Mr. ALLISON'S motion; and the committee refused to rise.

Mr. KOONTZ. I move to amend the amendment by striking out "six" and inserting "seven." There are many persons throughout the country engaged in carrying passengers who are contractors upon small post routes. They engage in the business, not so much because it is remunerative, but in order to accommodate the wants of the public. It is well known that these mail contracts are awarded to the lowest bidders, and I think it unfair to those parties who have taken the contracts at the lowest price, and who are compelled by public necessity to carry passengers, that they should be taxed. I withdraw my amendment to the amendment.

The question recurred on the amendment proposed by Mr. TRIMBLE, of Kentucky.

Mr. INGERSOLL. I desire, with a view of testing the principle involved in this section, to move to strike out "two and one half," in line three, and insert " seven;" and in line four to strike out "gross" and insert the word "net" in lieu thereof.

The CHAIRMAN.. That amendment is not in order until the amendment of the gentleman from Kentucky [Mr. TRIMBLE] shall have been disposed of.

The question was taken on Mr. TRIMBLE'S amendment, and it was disagreed to.

Mr. HIGBY. I move to amend the section by striking out in lines six and seven the words and stage coach or other vehicle, except hacks or carriages not running on continuous routes. Mr. Chairman, I venture the assertion that there is no State in the Union

tax.

street railroads do not pay, and yet they have to pay this tax. They continue to pay it possibly because they are not so easily broken up and the amount invested in them cannot so conveniently be put in other business. But a stage route can be very easily broken up.

A friend near me [Mr. STARKWEATHER] calls my attention to the fact that of the tax derived from this source last year California alone paid the sum of $45,569 64. That tax is paid upon routes where it costs four and five times the amount to travel a hundred miles that it does on any railroad in the eastern States, and those routes pay four and five times the tax that is paid for the same distance and amount of travel in the East. It makes an extremely grievous burden upon the people of a State who can travel in no other way than upon those stages. An effort was made in the Thirty-Ninth Congress to keep this tax out of the law, and some of the members of the Committee of Ways and Means were in favor of omitting it. But a majority of the committee held that it should be retained, and it was put in. I think this is one of the burdens from which the people should be relieved. I am not speaking in behalf of the owners and capitalists interested in stage lines, but of the mass of the people who are compelled to travel in this way and can travel in no other; and because the expense of traveling in my State is so extremely high in comparison with the expense of traveling in the East.

Mr. SCHENCK. It is very natural, I suppose, that we should all look at this subject from the point of view in which it necessarily presents itself in the State or locality we represent. The gentleman from California [Mr. HIGBY] objects to taxing these lines of stagecoaches, and moves to strike out the provision imposing the tax, so as to put them upon a different footing, as it were, from that occupied by lines of railroads. And what is the reason he assigns for his opposition? That this tax operates unequally upon different parts of the country.

The whole amount of revenue received last year from the tax on the gross receipts of stagecoaches, carriages, and vehicles upon continuous routes, was about two hundred and fortyone thousand dollars. The gentleman says that he finds that of that amount $45,000 was collected in California alone. Why is that? Because in California they are running stagecoaches, while in other parts of the country they are running railroads.

I suppose the tax on bullion in California is many times the amount of tax upon bullion in

Indiana, because they dig it in the one place and do not in the other. The tax is collected where the article is found. And the fact that this mode of conveyance is taxed more in one part of the country than another is compensated by the fact that in other parts of the country other taxes are more while in this part of the country they are less. In other words, there is no inequality in the matter, because you tax the mode of conveyance, no matter where it may be found. And in one part of the country you tax one investment of capital, and in another part of the country you tax another investment. It does not follow that California is hardly treated because she pays one fifth of all the tax raised in the United States upon stage-coaches. Other States might respond that they had paid taxes upon railroads very largely beyond their proportion in extent of territory and amount of population. There is a fallacy in the statement and argument the gentleman has made upon the inequality there is in the matter of this taxation.

Now, sir, the Committee of Ways and Means in this matter have not gone beyond the present law. They have reported in this bill the same provision upon this subject that there is in the present law. We have been unable to see why capital invested and employed in one kind of business should be freed from taxation any more than capital invested and employed in another kind of business. One thing is certain, those who invest their capital in any business do so with a view to the profits they expect to derive upon it. If one kind of business becomes unprofitable, through competition or any other cause, they shift their investment into something else; and thus the whole thing naturally finds something like a level.

Mr. FARNSWORTH. Will the chairman of the Committee of Ways and Means be kind enough to state, as I believe he has the returns before him, how much revenue has been derived from this tax on railroads, steamboats, &c., during the past year?

Mr. SCHENCK. The gross revenue collected under this provision from railroads has been, in round numbers, $4,128,000; on ships, barges, &c., $4,876; on stage-coaches, &c., $241,297; and on steamboats, $91,805, making an aggregate of between five and six million dollars.

ested, I procured a remission of those charges. I believe that such enterprises should be relieved also from this tax on the gross receipts. I think such exemption is equally just with the provision exempting toll-roads and toll-bridges. I hope the amendment will be adopted. Mr. ALLISON. I oppose the amendment, and ask for a vote.

The amendment was not agreed to.

Mr. INGERSOLL. I move to amend the pending section by striking out the word "two" before the words "per cent.," and inserting in lieu thereof the word "seven ;" and also by striking out "gross " before the word "receipts," and inserting "net ;" so that the section will read :

That there shall be levied, collected, and paid, a tax of seven per cent. on the net receipts for the transportation of passengers of every railroad, canal, &c. Mr. Chairman, I do not know that this amendment will meet the concurrence of a majority of the committee; but, whether it shall be adopted or not, I want to enter my protest against the principle involved in this section.

Mr. FARNSWORTH. What does my colleague mean by "net receipts ?"

Mr. INGERSOLL. Receipts over and above the expenses of operating the road, canal, or whatever it may be.

Mr. FARNSWORTH.

profits?

Then you mean

Mr. INGERSOLL. Yes, sir. Mr. FARNSWORTH. Why not say profits?"

net

Mr. INGERSOLL. There may be a distinction between receipts and profits; because out of the net receipts or earnings of the road, a company might have to pay interest on its bonded or funded debt; but still those net earnings would be profit on the running of the road for the particular year. What I design to accomplish by this amendment is that no railroad company or similar corporation shall be obliged to pay taxation on gross receipts, but only on the surplus after the expenses of conducting the business have been paid. Whether the committee shall agree with me or not, I for one want to enter my protest against the whole principle of assessing a tax on gross receipts. There is no justice, no equity in such a principle. Take, for instance, the railroads in the State of New York. The New York Central railroad earns annually $14,000,000 of gross receipts, while its net receipts amount to $4,000,000; that is the amount left after paying the expenses of operating the road. The Erie railroad earns, in round numbers, $14,000,000 of gross receipts, while its expenses are about ten million dollars, leaving $4,000,000 of net receipts. I think, sir, those roads paid Mr. Chairman, I would not have proposed about two hundred and eighty thousand dollars

The amendment of Mr. HIGBY was not agreed to; there being—ayes five, noes not counted. Mr. DRIGGS. I move to amend by adding at the end of this section the following:

Provided, That no tax shall be assessed upon the gross receipts of any steamboat or ferry-boat, where the same have not amounted to the actual expense incident to running the same for the six months preceding, upon the production of satisfactory proof to the assessor of such fact.

this amendment but that I have felt it to be my duty to do so. I am satisfied that no tax should be levied on the proceeds of any business or enterprise when those receipts do not equal the actual expenses. I think, sir, that the cases contemplated by my amendment are peculiar, and perhaps different from any others which have been presented to the attention of the committee. In some of the newer sections of the country, it frequently happens that little steamers are started to run to and from places where small communities have been built up; and this means of communication is a matter of absolute necessity in order to accommodate the people of those settlements. In my own district, a gentleman during the last year ran two boats in that way, which were supported to a great extent by the citizens, who paid double fare in order to keep them running, and to make the receipts somewhere near the expenses. That gentleman was assessed of course upon the gross receipts of those boats. Now, it seems to me that there is a great hardship in imposing such taxation. In many cases these steamers and ferry-boats ply but a few miles. They have been charged, in some instances, custom-house fees on departing and arriving. In regard to some boats of this character in which my own constituents were inter- Il

each per annum upon their gross earnings. Mr. MAYNARD. My friend will pardon

me.

That was paid out of the gross earnings, and not out of the net earnings as he calls them. Mr. INGERSOLL. Many of our roads, and the gentleman will see the distinction, pay on their gross receipts and have no balance left. They have to pay on the gross earnings of the road even if they sink money in the operation. That is the proposition here. And, sir, not one half of the railroads in the United States pay dividends to the stockholders. Take the roads in Minnesota and Wisconsin and elsewhere. There are roads now building in Illinois, extensions of roads in operation, which have never paid one farthing of dividend.

Mr. FARNSWORTH. Is it not in the power of these railroad corporations to make these dividends as they please?

Mr. INGERSOLL. If they are rascals, then make laws to detect them. Mr. FARNSWORTH. them off in a thousand ways?

Cannot they take

receipts, you tax them when in reality they, in the beginning of these new enterprises, may have suffered very heavy losses. You tax them when they have already borne losses in the hopes that in the end the enterprise will be a success. I do not undertake to break down the revenue from this source. I say that a railroad corporation is better able to pay seven per cent. on the net receipts than two per cent. on the gross receipts.

[Here the hammer fell.]

Mr. ALLISON. I desire to say one word in reply to the various amendments, and then to move that the committee rise to close debate on this section. It is perfectly certain, Mr. Chairman, that from some source we must raise revenue. This practice of raising rev

enue from gross receipts is in accord with almost every provision in this tax bill. We tax manufacturers so much on sales. Even if they have lost $10,000 each on their manufactures, still they must pay the tax. So with the wholesale merchants. If they lose, still they must pay the tax. During the last year we secured about six million dollars from this source, and there are other subjects which can be better relieved than this.

Mr. MAYNARD. If we pass this emasculated section. how much will it give?

Mr. ALLISON. We will gain nothing if these amendments are adopted.

Mr. HARDING. I ask the gentleman to inform me whether every dollar of this $6,000,000 does not come at last from the people upon whom these corporations, taking the burdens off their own shoulders, put them? Do not these companies collect this tax from the people? Does the gentleman understand me?

Mr. ALLISON. I do. I do not know that railroad and transportation companies do so. But, sir, in some States they cannot do it. Whatever is imposed upon the New York Central railroad is compelled to come out of the stockholders of that company. It is the same with some street railroads. They cannot charge it upon their fares.

Mr. INGERSOLL. Do you know any other railroad beside the New York Central where that is the case?

Mr. ALLISON. These railroads do charge it over. It is a heavy burden, I know, but I want gentlemen who ask that these companies may be released from taxation to provide some means by which taxes shall be obtained from some other source. If it is the object of gentlemen to repeal all taxes, then let us do it, and reverse this whole principle. But I say there is no tax more just than this upon transportation, especially when we have reduced it one per cent. Last year we took off all the tax on transportation or freight, because we thought it was a burden on the people. I hope the next year we can take off this entirely. I agree it is a burden, but it is one we must endure for the time being. Therefore I hope the several amendments interfering with the revenue to be received from this source will not be adopted.

Mr. HIGBY. I can tell the gentleman how to remedy it. By equalizing taxation-not by throwing off all taxes, but by equalizing them.

Mr. ALLISON. I am obliged to the gentleman for the suggestion. I move that the committee rise.

Mr. TRIMBLE, of Kentucky. Will the gentleman yield to me? I think if he will agree to strike out $2,000 and insert $1,000 it will relieve a great many of these little stage companies and turnpike companies.

Mr. ALLISON. I will agree to that. I believe it is a just and fair amendment. If the gentleman had not made it $6,000 I would have voted for it before.

Mr. TRIMBLE, of Kentucky. I make that motion.

The CHAIRMAN. It is not in order now. Debate is exhausted on the pending amendment. Mr. INGERSOLL. I move to strike out the word "receipts."

Mr. SCHENCK. Can the gentleman modify his own amendment and thus make another

The CHAIRMAN. He cannot if it is objected to.

The question being put on the amendment of Mr. INGERSOLL, there were-ayes 7, noes 48; no quorum voting.

Tellers were ordered; and the Chair appointed Messrs. INGERSOLL, and TRIMBLE of Kentucky.

The committee divided; and the tellers reported-ayes 24, noes 71.

The CHAIRMAN. The Chair votes in the negative, making a quorum; and the amendment is disagreed to.

Mr. HIGBY. I move to amend by insertafter the word "and," in line six, the words one per cent. on the gross receipts for the transportation of passengers on ;" so that it will read:

On the gross receipts for the transportation of passengers of every railroad, canal, steamboat, ship, barge, canal-boat, or other vessel, and one per cent. on the gross receipts for the transportation of passengers on stage coach or other vehicle, &c.

I have proposed this amendment in order to say something in answer to the chairman of the committee, because he did not-I will not say intentionally—but he did not represent the matter as it truly is. If the object is simply to tax capital when he is taxing income upon stage companies it goes a great deal further than our experience justifies. He is taxing the people who support these lines of coaches. They are the ones who will have to pay it, and who do pay it. Sir, we in California have to pay, I will not say extravagant prices, but much higher prices for traveling than is paid anywhere in this Union on stage coaches. I have nothing to say with reference to our railroads or steamboats. Although we are paying a large revenue to the Government by our thousands of passengers from San Francisco to New York every month, we pay the tax willingly. But when you come to our inland travel by stage coaches, I to the House that the price we say have to pay is marvelous; and when this tax is put on over and above it, and the people who travel have to pay it, it will be considered a terrible burden upon them. I think we shall find the same to be the case in the Territories, where they cannot travel by railroad, especially in the Territories west of the Rocky mountains.

Now, sir, the tax that rests on our shoulders in California amounts to over fifty thousand dollars, where we have only some two hundred miles of railroad, and yet on our stage coaches we pay between forty and fifty thousand dollars. That is borne by the mass of the people, those who have small means. They are obliged to travel, and there are no competing lines by which they can go.

Upon our great thoroughfares, where there is competition, where there are different lines competing with one another, it is very different. But it is not so in that State and in the neighboring States. There are no competing lines, and they cannot be maintained. It is for that reason that I make this motion, and ask that the people shall be relieved from this burden; for it is not the companies who pay it, but the people.

The question was taken on Mr. HIGBY'S amendment, and it was disagreed to-ayes twenty-six, noes not counted.

ENROLLED BILLS SIGNED.

At this point the committee rose informally, and the Speaker having resumed the chair,

Mr. HOPKINS, from the Committee on Enrolled Bills, reported that the committee had examined and found truly enrolled bills of the following titles; when the Speaker signed the same:

A bill (S. No. 322) granting a pension to Sherman H. Cowles;

A bill (S. No. 323) granting a pension to Michael Kelly;

A bill (S. No. 344) granting a pension to Caroline and Margaret Swartwout;

A bill (S. No. 420) granting a pension to James A. Guthrie;

A bill (S. No. 421) granting a pension to Caroline E. Thomas; and

A bill (S. No. 424) granting a pension to

INTERNAL TAX BILL.

The Committee of the Whole on the state of the Union then resumed its session.

Mr. SCHENCK. I ask unanimous consent of the committee that all debate upon this section shall be closed. That will not prevent the offering of amendments.

There was no objection, and it was so ordered.

Mr. TRIMBLE, of Kentucky. I move, on page 173, line twenty-three, to strike out two" and insert "four" in lieu thereof; so that the proviso will read:

Provided, That no tax under the provisions of this section shall be assessed upon any person, firm, company, or corporation whose gross receipts do not exceed $4,000 per annum, &c.

The amendment was agreed to.

Mr. COBB. I offer the following amendment as a proviso, to come in at the end of the section:

Provided, That those railroad companies which have received grants of land from the Government of the United States shall pay four per cent. on their gross earnings.

The amendment was disagreed to-ayes ten, noes not counted.

The Clerk read the next section, as follows: Express and Telegraph Companies.

SEC. 120. And be it further enacted, That there shall be levied, collected, and paid a tax of three per cent. on the gross amount of all receipts for carrying on or doing any express business within the United States, or between any place within the United States and any foreign country; and on the gross amount of all receipts for receiving or transmitting dispatches or messages by telegraph.

Mr. SCHENCK. I am instructed by the Committee of Ways and Means to offer the following amendment:

Page 175, section one hundred and twenty, line three, strike out the word "three" and insert "two and one half" in lieu thereof; so that it will read: That there shall be levied, collected, and paid a tax of two and one half per cent. on the gross amount of all receipts for carrying on or doing any express business within the United States, or between any place within the United States and any foreign country, &c.

The amendment was agreed to-ayes fiftytwo, noes not counted.

Mr. SCHENCK. I offer the following amendment from the Committee of Ways and Means, to come in immediately after the words just read:

And on the gross amount of all receipts for providing sleeping-cars or other special accommodations for passengers on railroads for which charges other than the fare for transportation are made. The amendment was agreed to.

Mr. SCHENCK. I propose, now that sleeping-cars are taxed, to add the words "and sleeping-cars" to the head line.

The amendment was agreed to.

Mr. SCHENCK. I offer the following amendment from the Committee of Ways and Means:

Page 175, at the end of line six, insert the words "three per cent;" so that it will read: And three per cent. on the gross amount of all receipts for receiving or transmitting dispatches or messages by telegraph.

Mr. ALLISON. I should like the chairman of the Committtee of Ways and Means to inform the committee the reason for a distinction between express companies and telegraph companies.

Mr. SCHENCK. My colleague had better have asked the committee. The committee this morning, upon a revision of this section of the bill, agreed to bring the tax on express companies down to two and a half per cent. No proposition was made to bring down the tax on telegraph companies. By a vote of the committee the tax on express companies was brought down to two and a half per cent., and hence it is necessary to repeat this language. There were was no action in the committee in reference to telegraph companies.

Mr. ALLISON. I will say this: that I happened to be out of the committee-room when the final vote was taken upon this question of the tax upon express companies. But I sup

parts of the section. I can see no reason for charging telegraph companies three per cent. and express companies only two per cent.

Mr. HOOPER, of Massachusetts. I understood that the motion was to strike out three per cent. and insert two and a half per cent. in both cases.

Mr. SCHENCK. Two of the members of the committee have said that they understood that this amendment was to apply both to express companies and telegraph companies. They will recollect, however, that not one word was said about anything but express companies.

Mr. HOOPER, of Massachusetts. That may be so; but still I understood that the amendment applied to both.

Mr. SCHENCK. If it was so understood, of course the case is different from what I supposed.

Mr. MAYNARD. I know it is not exactly in order to refer to what took place in the committee-room. But I think I may be permitted to say that we had before us persons representing express companies, while there was no one there representing telegraph companies. That was the reason, perhaps, why nothing was said about telegraph companies.

Mr. SCHENCK. Very well; by voting down this amendment the tax will be left at two and a half per cent. upon both telegraph and express companies.

Mr. ALLISON. The Committee of the Whole has reduced the tax on transportation companies from two and a half to two per cent. Under the present law express and telegraph companies are placed precisely upon the same footing. We have agreed to reduce the tax on express companies from three per cent., as reported, to two and a half per cent., for what reason I do not know, except that the proposed tax was too heavy.

Mr. CULLOM. The different companies pursue different kinds of business.

Mr. GRISWOLD. In justice to the chairman of the Committee of Ways and Means, [Mr. SCHENCK,] I desire to say that I was present this morning at the meeting of the Committee of Ways and Means, when we had under consideration the subject of decreasing the tax on express companies. I understood the matter exactly as the chairman says he understood it. Nothing at all was said about reducing the tax on telegraph companies, and I supposed the agreement was to leave that as it was reported in the bill.

The question was then taken upon the amendment of Mr. ALLISON to the amendment of Mr. SCHENCK; and it was not agreed to.

The question recurred upon the amendment of Mr. SCHENCK, to make the tax on telegraph companies three per cent.

Mr. FARNSWORTH. I move to amend the amendment so as to make the tax two per cent. I see no reason why telegraph companies should be taxed more than railroad companies.

Mr. SCHENCK. Because their profits are greater.

Mr. CULLOM. It is the most profitable business in the country.

Mr. FARNSWORTH. It seems to me we might with just as much propriety tax people for the letters they receive. The telegraph

interest is an interest which involves the whole people of the country. Everybody is interested in telegraphing, and in having it made as cheap as possible. Taxing it simply increases the cost of telegraphing.

Mr. CULLOM. And it is so with everything else.

Mr. FARNSWORTH. So it is. But why increase the tax on telegraph companies when you decrease the tax upon railroads and express companies? I am not aware that telegraph companies are any more prosperous than express companies. I do not know that express companies have more burdens imposed upon them than telegraph companies. It seems to me it is making an invidious distinction which should not be made. I have no interest in