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cents per gallon, believing that, on the whole, whole to fifty cents per gallon is as high as a forty-five cents per gallon, it requires sixty. to be the best point on which we can settle and safe collection of the revenue will warrant. seven and a half cents worth of molasses to dispose of this matter.

The specific levy of thirty-five cents, adding to make a gallon of spirits. It will cost some ("Here the hammer fell.]

that the license, will, in my view, accomplish thing like ten cents to manufacture it, which Mr. KELLEY. I withdraw the amendment what is desired by this bill, that is, take away brings it to seventy-seven and a quarter cents. to the amendment.

the temptation for fraud and give the Govern- | You cannot make a gallon of these fraudulent Mr. JUDD.' I renew the amendment to ment a fair income from this article of luxury. spirits from molasses and sell it in the market the purpose of explaining In

for less than about eighty or eighty-eight cents. in a very few words my conviction and belier Safethe present situation of the country it is

, Mr.

It may become lower hereafter ; but this being I observe, from the course of the discussion tion. If things continue as they have been the case, I doubt whether we have gone too this morning, that there is a very general con- this source of revenue will substantially cease. high in fixing sixty cents. If the House prefer currence of sentiment that the tax on distilled At any rate, the experiment must be made, titty cents as the direct tax on whisky, I will spirits as at present fixed by law cannot be and the fears expressed that there will not be suggest when we come to that point, to increase collected. Discreditable as that may be to the revenue enough to meet the wants of the coun- the tax upon capacity. parties really responsible for this condition of try will be dismissed in consideration of the [Here the hammer fell.] affairs, it is a condition not to be disregarded condition of the receipts from this source. My Mr. HARDING. I move to strike out in the framing of our rerenue laws. While my desire is that we shall so frame this bill as to twenty-five cents, and in lieu of it to insert conviction is that the larger part of these fix the entire levy, whether by special tax or twenty-six cents. frauds upon the Government are attributable otherwise, at an amount not exceeding fifty Now, Mr. Chairman, I wish to say to the to the administration of the present law and

To do this we must, according to the committee, while I am as anxious to obtain a the executive department of the Government, estimates made by the chairman of the Com- large amount of revenue from this source as I cannot exclude entirely from my considera- mittee of Ways and Means, as to the amount any gentleman upon this floor, I am fully con. tion the fact that the high rate of taxation from licenses, &c., reduce the special tax to vinced, after considerable observation bestowed and the enormous profits derived from the about thirty-five cents.

If you add to that the on this subject during the last three or four violation of law has been one proof of the amount of the license tax, as provided in this years, living, as I do, in the neighborhood of causes that induced the present position. My | bill, you have a rate of about' fitty cents per distilleries, that no considerable amount can conviction is that if this law and its enforce- gallon. And I repeat again, Mr. Chairman, ever be realized from the tax upon distilled ment were a private enterprise men honest to that my belief is that unless we destroy illicit | spirits if we put this tax at a higher figure than execute would be found. If the rules of hon- distillation and put an end to these frauds, we twenty-five or thirty cents. esty and business capacity, that prevail ordi- shall get no revenue, and that the only sure Now, sir, before the war, as will be rememnarily among our business men, were applied method under the control of the legislative | bered by gentlemen who hear me, whisky or to the execution of the present law, instead department of the Government is to reduce alcohol sold for about sixteen cents per gallon of receiving from this source only about four- the taxes.

by wholesale. The tax of sixty cents now proteen million dollars during the past year the Mr. SCHENCK. I observe that there is posed by the Committee of Ways and Means Government would have received $100,000,- manifested by the House a good deal of har. is about four times what the article sold for 000. But the history of the country, and its mony on this subject, not only among mem- previous to the war. It is certainly, at least, administration during the last year shows, dis- bers, but between the Committee of the whole three times the value of the article. This is an tinctly and clearly, that under the present and the Committee of Ways and Means. The inducement to fraud. Where a man has fair system we were not to collect the present tax. Committee of Ways and Means have made a remuneration for honest labor there is no inImpunity induces boldness, and we are de- recommendation to the House of sixty cents as ducement to perpetrate fraud; but fraud upon generating daily, and the influence of this the amount of the direct tax. They do not the revenue is invited where the tax is so much demoralization is extending wider and wider ; ask to have it considered in any other light than greater than the cost of the production of the and the combinations to defeat the execution as a recommendation. They will be perfectly article itself. If we wish to collect the revenne of revenue laws are growing stronger. The satisfied with any figure that the House may, from this source we must reduce the tax to the skill displayed in violating law if applied to in its discretion, think it wisest to fix. Indeed, sum I have stated. While I have great confiany honest calling would entitle the possessors the committee were somewhat divided upon the dence in the ingenuity with which the committee to honor and renown. We cannot change subject, some favoring a tax a little below sixty have framed this bill, and while I approve the the Administration, as has been recently dem- cents, and others a tax a little above that means of distributing the tax, taxing the capa. onstrated, and the question recurs can we do amount. The common purpose we all had in city, taxing the barrel, taxing the product, and anything so as first, to prevent in any degree view was to fix an amount of tax which shall so on, yet, sir, I wish to say that, in my judg. these frauds upon the Government, and sec. be collected, and which in process of being ment, it does not prevent fraud. We are to ondly, to obtain the largest amount of revenue collected shall not be subject to those evasions have a system of stamps. Stamps are to be put for the Government. It is perfectly evident and frauds which have been the disgrace of upon the barrels. How do they prevent parties that the tax of two dollars has not given us the country.

from drawing out the contents of the barrel fifteen cents per gallon during the last year. It is not worth our while, however, to stand and filling it with illicit whisky? I confess I The gentleman from New York (Mr. Prien] here kicking at the “whisky ring” or fighting | do not see how that can be prevented by this says not five cents. My desire was to state it it, because it is very hard to ascertain what system of stamps. I am of the opinion that large enough, so that if there was any error it that ring is. I sometimes doubt whether it the tax can only be collected at the distillery. would be against my position and not in its really has an existence as an organization. The moment you permit the party to remove favor. Hence no man should be alarmed at | It is a sort of myth. In saying this I do not the whisky from the distillery without paying

mean to be understood as saying that there is the tax and to allow it to be transported in [Mr. INGERSOLL] to reduce the tax to twenty. not a band of rascals in the country making bond that moment you open the door to fraud. five cents, if by reducing the tax to that figure | money by frauds in reference to whisky; but We have had experience enough already on that we shall do something towards restoring the these men, so far as I have been able to dis-point. If you permit the whisky to go in the

cover, while they are all ready to cheat the cars for exportation, what opportunity is there to defraud. At that

for fraud ? What opportunity for changing the price the Government will obtain more revenue time to cheat each other. If there is anything | barrels? They will have depots where that can than it has obtained during the last year at that a distiller or å whisky dealer engaged in be done. the present rate of two dollars as fixed by the these frands suspect more than anything else Why, sir, our distilleries in Illinois did a present law.

it is that the revenue officer with whom he is profitable business until we allowed the transI say, then, let us, in accomplishing these colluding will cheat him ; and the revenue portation of whisky in bonds without paying objects, cut off, according to the illustration officer who is trying to get blackmail is just the tax. The moment that was allowed our of the gentleman from Pennsylvania, (Mr. KEL- about as fearful that the distiller or the dealer distilleries in Peoria were closed. How they LEY,] the entire tail at once. Let us not make from whom he expects to get it will cheat him continued up to that time I know not. another experiment upon this question. If it in the course of their transactions. We, there. In the brief time allowed me I can only is doubtful whether a specific tax of sixty cents fore, have them all to fight; and whether you throw out à few disconnected ideas. There a gallon, with the additional taxes by way of call them a "whisky ring" or by any other are, Mr. Chairman, millions of money invested licenses, &c., provided for in this bill will have name, there is a large number of dishonest in the manufacture of distilled spirits. Let us the effect of preventing these frauds and realiz- persons throughout the country, official and put this tax so low that the men interested in ing the proper amount of the revenue, let us go | unofficial, against whom we have to protect this illicit distillation will have to give it up; below sixty cents, and my judgment, Mr. Chair: the Treasury. How shall we do it? say- for, sir, it costs more to manufacture whisky man, is, that if both forms of taxation when and we all seem to be agreed upon the point in an illicit way than in the regular and legal computed together make a tax of seventy-six | by putting the direct tax low enough to take mode. Let us have the honest manufacture cents on a gallon, as estimated by the chair- away the inducements to this fraud. What || protected against the illicit distilleries. Then man, [Mr. Schenck,] there is a margin of shall be the amount ? The reason. I have de- the Government will collect more revenue ; profit to the fraudulent that will continue the clared my willingness to assent to a tax of and that can only be done by reducing the tax. system in operation, and that we shall have fitty cents is that the great proportion of the [Here the hammer fell.] gained nothing for the Government. The only present fraud comes from the distillation of Mr. LOGAN. Mr. Chairman, I rise to effect is in a measure to reduce the profits of spirits from molasses. Now, it takes a gallon oppose the amendment for the purpose of hav. the parties concerned in defrauding the Gov- and a half of molasses to make a gallon of ing an opportunity of giving my views in refer

I think that a tax amounting in the spirits; and the present price of molasses being ence to the tax upou distilled spirits. Wo

the proposition of my colleague from Peoria mer

moral tone of those dealing jer this article choice Government

, are almost all ready at the same






attempted, sir, at one time to prevent frauds where whisky is distilled. Mr. Curtis, of my careful consideration of the facts presented, and in disiilled spirits in this country by trying, if own State, was president of that convention. after conference with many of the principal possible, to get the Administration to appoint | They resolved first that,

dealers and manufacturers from all sections of none but honest men for the collection of the

"In order to confine the opportunities of fraud to the country, the commissioners are of opinion revenue. I made the best fight I could on as small a space as possible and avoid the multiplica- that with the maintenance of the present tax that subject, but failed. For that I have re.

tion of expensive officials, we recommend that the
tax be assessed and paid at the still, or when the

of two dollars per gallon the quantity of disceived any amount of abuse, for which, how. spirits leave warehouse class 'A,' and that class 'B'

tilled spirits which may be expected to be proever, I care nothing. They have even gone so warebouses be entirely abolished.”

duced and rendered subject to assessment for far as to employ a man who has vilitied me The convention made that recommendation the iminediate future will be from forty-two to all winter in my own State and who is now to us last winter.

forty-five million gallons." In 1865 the Gov. running around this city like a vulture.

Sir, I have been in favor of collecting the ernment realized near sixteen million dollars ; But, sir, becoming satisfied that this cannot tax at the distillery from the time I knew any. in 1866, over twenty-nine million dollars ; in be done, then what is the next best thing for thing about the matter, and I am for it to-day. 1867, over twenty-eight million dollars, and us to do in order that the Government shall I was told by an attorney of the whisky men the present year, from returns already made, it not be defrauded of all the revenue? Believ. the other day that if I dared to vote against will exceed but little over thirteen million doling that the House have determined to reduce transportation in bond they would send a man lars at two dollars per gallon; and of that the the tax, I desire to recur to the argument that to Congress next time who would vote for it. expense of collecting will be near three million I made on the first occasion, which was that I I say let them do it. So far as I am concerned dollars. I do not believe, Mr. Chairman, in was in favor of collecting it at the distillery, so I shall not vote for anything that I think wrong. the doctrine contended on this floor that two that the distiller himself shall be willing to pay If the whisky ring is strong enough to make dollars tax per gallon cannot be collected. I it rather tban employ dishonest means of evad- this Congress do just as they have a mind to, am satisfied if honest men were selected as ing the law.

so be it. But I do not believe any such thing. revenue officers its collection could be enforced ; Now, sir, the committee have reported sixty || I do not believe there is a member of Congress still I admit that the enormous tax of two dolcents. As a matter of course I agree to that controlled by any such influence. These slan- || lars per gallon is an incentive to commit frauds, report, and am willing to stand by it if the ders that are afloat through the country are the and iherefore am in favor of reducing the tax, House so agree.

But I say now that if the slanders of penny.a-liners who are employed | believing that by doing so the Government will additional tax is an inducement to fraud I am to slander and bedaub the reputations of men realize a greateramount of revenue from whisky in favor of reducing to less than that. I in this House. But let us act on a principle But I am opposed to making the tax less prefer myself to fix tifty cents, although, so far that is sensible. Let us collect the tax-let it than fisty cents per gallon. Some of the genas the report of the committee is concerned, be sixty, fifty, forty, or thirty cents, as it may tlemen contend that it ought to be reduced as I have concurred in it. With this reduced be-at the distillery, and have no transporta- low as twenty-five cents. Such a reduction, taxation there will be no inducement to fraud. tion in bond, and then you will get your tax, in my opinion, would be wrong and greatly

Now, sir, I have never been in favor of giving and you will never do it in any other way. reduce the revenue, and the result would be the whisky men—the rings, as they are termed, An argument is made here that western men that Congress would find it necessary shortly and perhaps correctly-more advantage under will be crippled by that measure. It is no such to raise it again. Much has been said in regard the law than they ask themselves. If there is thing. I will tell you what the effect will be to the “whisky ring." Mr. Chairman, the a whisky ring-and I have no doubt of it my. on the West. The moment you collect the tax only effective means, in my opinion, to thwart self, at least there is some organization of the at the distillery warehouse and pass a bill for. the frauds of that ring is to put the tax at a kind, though it may not be a ring-let us give | feiting the real estate in case of fraud you reasonable rate, say fifty or sixty cents per them no more than they ask. How, then, are drive the distilleries to the side of the corn- gallon, and enforce the collection by stringent we to destroy them? Now, I was in favor fields, which is the proper and legitimate place || laws. I agree, Mr. Chairman, with the honorlast winter of keeping the tax at two dollars. for them to be. That will be the effect of it. able gentleman from Illinois (Mr. LOGAN] Why? Because we have twenty-five million When you collect the tax at the distillery you that the tax ought to be collected at the disgallons in bond which would give us a revenue drive them from the places where frauds are tillery. One great drawback to the revenue is of $50,000,000. I was desirous of having that committed and put them where frauds cannot the numerous useless officers employed, which $50,000,000 paid on those spirits in bond be committed. That will be the effect, and absorbs a large amount of the revenue, and this before we reduce the tax. That was one reason hence I am for that principle.

abuse ought to be corrected at once. Now, why I advocated retaining the present tax. But Now, Mr. Chairman, I desire to read another Mr. Chairman, I would say to the committee as it seems the tax is to be reduced, I want to resolution of this whisky convention. They | let us fix the tax at a fair rate, have no more get as much as I can from whisky in bond and resolved that inasmuch as the tax was likely to || officers employed than absolutely necessary, whisky out of bond. At twenty cents we would be reduced to fifty cents a gallon it should be and I have no doubt we will realize from disget very little, at thirty cents more, at forty collected at the distillery with a stamp; and tilled spirits from thirty to thirty-five million cents more, and at fifty cents still more. But they say "that any barrel of distilled spirits dollars per annum. with even fifty cents we will only get $12,500,000 || found leaving a distillery or class · A' ware

Mr. FARNSWORTH. I am not among on the amount of spirits in bond. I am in house, without such stamp, should be con- those who can say “ I told you so,'' when we favor of fifty cents, but at whatever sum the demned and destroyed and the distiller fined put this tax at two dollars per gallon, for I did tax is fixed I am in favor of collecting it at $300 for each barrel; and that any person who not then suppose there was so much rascality the distillery.

shall buy an unstamped barrel of crude dis. and corruption in the country as the sequel has That is my theory. But I believe, from what tilled spirits should be liable to the same pen- || proved to be the case. But I am now a thor. I have learned, that it is the best plan. When alties as the distiller."

ough convert to the propriety of reducing this you allow transportation in bond for any pur- [Here the hammer fell.]

tax so far, after securing the revenue, as to pose whatever you allow an opportunity for Mr. MILLER obtained the floor.

prevent the demoralization and corruption in fraud. My friend from Iowa [Mr. Allison] Mr. SCHENCK. I ask the unanimous con

the country. knows that from bis own town over eight hun- sent of the committee that all debate upon this The only question now before the Housedred barrels were transported last year to New section shall close in fifteen minutes.

for I believe members are generally in favor York which never paid one dollar of tax. Mr. BOUTWELL, Mr. COVODE, Mr. of the reduction of the tax now imposed-is, [Here the bammer fell.] INGERSOLL, and others objected.

how low shall we reduce the tax? Now, I do Mr. MILLER rose, and was recognized by Mr. SCHENCK. Well, as gentlemen seem not believe with the gentleman from Pennsylthe Chair, but yielded to

to be full of the subject, let the debate go on. vania (Mr. KELLEY) that we should reduce Mr. LOGAN, who said: I move to amend Mr. COVODE. I represent a great wbisky the tax so low that the cost of producing grain by striking out sixty and inserting forty-five. distriet, and I want to say something before the whisky, with the tax added, shall be as low as Mr. EGGLESTON. How did the gentle- debate is closed.

the cost of producing molasses whisky without man keep the floor?

Mr. MILLER. Mr. Chairman, it cannot be || the tax. Mr. LOGAN. If the gentleman understood expected that within the brief period allowed Now, crime is always expensive, and we parliamentary rules he could keep it in the members to discuss this section of the bill || should take that fact in consideration. A man same way: [Laughter.] I was speaking of under consideration that any one member can does not steal a little when he risks a great eight hundred barrels upon which no tax was present his views fully. The question under deal of punishment. He will not set up a still ever paid, because it was transported by some this section is as to the amount of tax to be in a secret place, and cannot afford to buy up roundabout way, and just after it was supposed imposed on distillation of spirits. I confess, revenge officers, and manufacture molasses to reach the warehouse the warehouse was Mr. Chairman, that a tax of two dollars per whisky simply for what it costs to buy the burned up and the whisky with it, as was gallon on an article that costs but thirty cents molasses and make the whisky from it. He alleged. Two days after it started from Du: to manufacture appears to be exorbitant, and is must make a large margin of profit before he bnque it is said to have reached the warehouse. higher than imposed in any other country save will run the risk of punishment and pay the That was impossible, as everybody knows--as that of Great Britain and, perhaps, Russia. The amount he must for purposes of corruption. the evidence shows. We try in vain to ferret amount of whisky annually manufactured in the Now, it seems to me that a tax of fifty cents out these frauds. Thousands have been com- United States is variously estimated; some per gallon, the sum resolved upon by the conmitted in the same way.

make it fifty million gallons, others seventy-five vention of honest distillers last winter-as they Now they talk about the whisky ring. Last || million, and others even as high as one hun- called themselves, and I know nothing to the winter there was a whisky convention in | dred million gallons. The able Commissioner contrary—is about the right figure. Washington city, represented by people from of Internal Revenue, (Mr. Rollins,) in his last Mr. İNGERSOLL. Allow me to correct Missouri, Illinois, and every State in the Union annual report, page 18, says, that “after my colleague. The amount recommended by




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the .convention of distillers was twenty-five fix the rate six, eight, ten, or even Gifteen cents amendment to the amendment were withdrawn, cents per gallon.

below this figure than incur the slightest risk would be the amendmerit of the gentleman Mr. FARNSWORTH. They were first sat- of the continuation of the distillation of spirits from New York (Mr. Van WYCK] to the tax isfied with a tax of fifty cents per gallon. I

in small distilleries, hidden away in garrets fixed by the Committee of Ways and Means. remember a conversation I had with some and cellars. If we reduce the tax to forty cents, I wish to know whether I am right in that members of that convention ; and while they twenty cents below the figure fixed by the com- statement? advocated reducing the tax to twenty-five cents mittee, the loss of revenue to the Government The CHAIRMAN. That is so. If there be per gallon, yet they told me that they could will not be important as compared with the no amendment to the amendment pending stand fitty cents per gallon; and that at fifty | risk of continuing for ten or twelve months then the question will be on the amendment cents per gallon i hey thought the fraudulent || longer the corrupt combinations that now con- of the gentleman from New York. distiller in New York, Philadelphia, or else- trol the manufacture of this ar icle, defrauding Mr. PAINE. The gentleman from Caliwhere could not compete with them. They the Government, corrupting the morals of the fornia has withdrawn the amendment to the said that when they created their distilleries people, and preventing the collection of the amendinent, and I now propose an amendment beside the corn-cribs, where the corn is cheap,

I withdraw the amendment,

to the amendment on which I shall ask for a the man in New York could not import the Mr. HIGBY. I renew the amendment. I rise vote of the House. I propose to amend the corn and distill the whisky, cheat the Govern- rather for the purpose of seeking information amendment of the gentleman from New York ment out of the tax, and make money by it. than to attempt to impart it. In the course of | by fixing the tax at ihirty-five cents per gallon.

I would then reduce the tax to fifty cents the debate this morning the gentleman from The chairinan of the committee informs us that per gallon, and make clean, square work of it, Ohio (Mr. GARFIE. D) made the statement that, in addition to sixiy cents per gallon there are and then put a tax of a dollar for every two in addition to the tax of sixty cents a gallon, other taxes imposed by the bill which, if the per gallons, or twenty dollars per barrel, and there is provided in the bill a tax of sixteen gallon tax is fixed at sixty cents, amount in the then I would increase the tax on sales to five per and a half cents not provided for in the present aggregate to sixteen and a quarter cents per

That I think would be easily collected, law, I ask the chairman of the Committee gallon, raising the tax to seventy-six and a and it seems to me we could realize the of Ways and Means whether that is the fact? quarter cents per gallon. If we put the tax whole tax, or very nearly the whole of it, at Mr. SCHENCK. I think that is substan- at thirty-five cents then there will be added ten those rates of taxation, which would realize a tially the case. Under the present law there is cents of the tax of four dollars on the barrel very good revenue to the country. I have thus no other tax than the two dollars per gallon of forty gallons, three cents of tax in the shape given my views upon this subject very briefly. || except the tax on the sales, which, being only of the three per cent. tax on sales at wholesale, [Here the hammer fell.]

one lenth of one per cent. on the amount above one cent retail charges, and one cent and one Mr. MILLER. I withdraw the amendment $25,000, amounts to next to nothing, and a quarter of tax of five dollars on capacity per to the amendment.

small special tax of $200 upon distillers. day of mash, in all fisteen and a quarter to be Mr. PILE. I renew the amendment to the Mr. HIGBY. Then this bill provides virtu. added to thirty-five cents, making fifty and a amendment. If the city I represent, and the ally for a taxation of seventy-six and a half quarter cents. I have made up my mind that millions of grain growers who contribute to cents as against two dollars under the present fifiy cents would be a fair tax. My amendthe trade and commerce of that city were not law. Mr. Chairman, from the earliest moment ment will make it almost exactly fifty cents. so vitally interested in this question of the tax of the imposition of the tax upon this article I should be willing to vote for a higher tax, but on whisky and the production of whisky in this of whisky, I believe in the Thirty-Eighth Con- I should be unwilling to vote for a lower tax country, I should not presume to say a single | gress, I have been in favor of the sum of fifty than thirty five cents in addition to the fifteen word on this subject. From the discussion cents, together with the member froin Obio and a quarter cents proposed by the bill. I this morning I think it is apparent that three and many other members of the House at that shall ask for a vote on my amendment of thiriy. results are intended to be reached by every tine. And I will say to the gentleman from five cents which, with the fifteen and a quarter member who has participated therein. The || Illinois, (Mr. Logan,) who quoted from the cents, will make the aggregate tax fifty and a first object sought is that the corrupt combina proceedings of a certain gathering in favor of quarter cents. tion which now controls the manufactnre of the reduction of' the tax to fifty cents per gal- Mr. EGGLESTON. I wish to renew the and trade in whisky shall be thoroughly and lon, that that was not an original idea with amendment to reduce the tax to twenty-five effectually broken up. The second is that we that body of men, for there has been a certain

I am opposed to the other amendinent. shall prevent the continued distillation of mo- number of the members of the Thirty-Eighth || I am from a district which pays more tax than lasses, and restore the production of this arti- and Thirty-Ninth Congresses who have always || any in the United States, with the exception cle to the grain of the West, and that its man- been of the opinion that the tax upon whisky of one or two, and yet there is not a distillery ufacture shall be carried on in localities where should not be more that fisty cents. If that in the district. I am satisfied from what I nature and the production of the grain has | body of men were dishonest men and trying have heard on this floor this morning that the furnished the greatest facilities. These two to defraud the Governinent it seems to me object of members of the committee is to get objects being accomplished, we then desire it would be their object to get the tax up to as much money out of the whisky tax as they that there should be collected from distilled the highest figure, when they would have the Now, if the Committee of Ways and spirits the largest amount of revenue that can opportunity to make more money than to have Means had taken the course which I think they possibly be secured. To attain this object, it reduced to the lowest figure.

ought to have taken last November, and started while at the same time effectually breaking up I was about to say, Mr. Chairman, I bad this machinery then, we would have now these corrupt combinations and restoring the intended to sustain the committee in fixing the been some thirteen or fourteen million dollars production of this article to the distillation of tax at sixty cents per gallon, although my own

better off than we are.

I am willing to shoulgrain and to localities from which it has been idea is that fifty cents is as high as the tax ought der a portion of the blame myself. But I sent transferred by the frauds that have prevailed

to be.

If there is to be added sixteen and a two or three resolutions to the committee some for the last three years, we should, I think, || half cents to the sixty cents, making seventy- time ago, one of them proposing to farm out make the tax not more than forty cents. six and a half cents per gallon as an offset the manufacture of whisky in this country. In The highest rate now named is, I believe, || against two dollars a gallon, it seems to me we

I believe we could realize sixty milsixty cents, the lowest twenty, and I ask the ought to come to the direct tax of fifty cents a lion dollars per annum from the manufacture attention of the committee to this single con- gallon upon distilled spirits. That, in iny judg. of distilled spirits. sideration: that it is of far more importance ment, is what the tax ought to be.

Mr. STEVENS, of New Hampshire. Does that these corrupt combinations be broken up, In reply to what has been said, that it will be the gentleman know of any civilized Govern. and the production of this article restored to impossible to collect this tax, I will say we ment that ever farmed out the manufacture of the distillation of grain and to the localities ought certainly to make the experiment of the spirits ? where the grain is produced, than to secure to machinery contained in the present bill. If it Mr. EGGLESTON. I know of no civilized the Government the difference in revenue is not strong enough let us make the machinery or uncivilized country that does not collect the between thirty cents and fifty cents or foriy || stronger, and let us see wbether we can collect tax on spirits better than we are doing now. cents and sixty cents; and if there is a differ- this amount of fifty cents. If we find it is not There is no country on earth that would let its ence of opinion among those who have given | strong enough, then when Congress meets again revenue system be run as ours has been run careful consideration to the subject as next December we can make it stronger and in reference to the collection of this tax. whether a tax of forty or sixty cents will most see whether we cannot defeat those wbo are I'rauds have been committed all over the effectually secure these objects, then it seems defrauding the Government.

United States, under the eyes of the revenue to me wiser that we should fix the lower figure It seems to me that we ought never to make | department and of members of Congress. Rethan that we sbould incur any risk of the con. a great difference between the cost of the arti- monstrances have been made against it

, but it tinuation of these corrupt combinations. If cle manufactured and the tax imposed upon it. has gone on until the country has become we fix the specific tax at forty cents, and then If the tax be many times more than the cost demoralized in consequence of the failure to increase the tax, as I am in favor of increasing of the article it will leave room for fraud, and collect the tax. it, upon the fermenting capacity of the still there is no more ingenious people than the Now, sir, if the committee will cut off the from four to ten dollars per barrel, it will make American people in this and in all other re- manufacture on whisky entirely, we would the aggregate tax sixty to sixty-two and a half spects.

realize more money in the next six months cents ; five to eight cents lower than the amount The CHAIRMAN. The gentleman's time than we have for the last six months. I sup; to which the chairman of the Committee of has expired.

pose my friend from New Hampshire would . Ways and Means thinks it could be raised, and Mr. HIGBY. I withdraw the amendment.

say that no civilized country would do that. yet prevent the distillation of whisky from Mr. PAINE. Mr. Chairman, I understand But, sir, if you cut off the manufacture for six molasses and imported articles. We had better the question before the committee, if the Il months you would get the tax of two dollars a




that way



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gallon on what is now in bond, and that would There is another point upon which I wish to or eighty millions of taxation upon assuming to give you $50,000,000.

remark, and I make the remarks now, because collect the tax and pay a certain amount to My opinion is we should make it twenty five I intend, if I do not change my views on the Government, I would not give the snap

of cents per gallon and collect it at the distillery: further examination, to offer an amendment my finger for the lives of the agents employed Then you collect it on all that is made, and to the report of the committee, unless the com- in collecting that tax. Our people would never you would have more revenue than you get in mittee shall see fit to propose it themselves, submit to anything of the kind. Quieter, the way it is running now. I am satisfied that which I should much prefer, to separate by more submissive people than ours are not disthe chairman of the Committee of Ways and law, and in the license granted, the business of posed to submit to that mode of collecting Means is as well acquainted with the whisky distilling for export and for the manufacture

I therefore hold such a system to be question as any gentleman on this floor, be. of medicine from the general business of dis. || entirely out of the question. canse he is surrounded by distilleries in his tilling in the country, so that transportation in district, where there are more of them, perhaps, bond shall be limited to the product of those arrange our taxes in such a way as in the aggre. than in any other district in the United States. distilleries that are licensed for the purpose of gate to raise sufficient revenue for the purposes I have a high appreciation of his opinion on engaging in the business of manufacturing for of the Government; and I think the Committhis question. But, sir, I am satisfied the export only. The great frauds upon the rev- tee of Ways and Means are not much out of country is running to ruin by letting the present enue heretofore have been in consequence of the way in the figures which they submit. system run on in the way it is going, and I advise the transportation bonds being violated. The Now, Mr. Chairman, I desire that the debate the chairman of the cominittee to get this bill business of manufacturing for export will be upon this particular section shall be brought out of the Committee of the Whole as soon as from four to five million gallons a year. That to a close, gentlemen having been heard pretty possible, with the tax fixed at twenty-five cents will employ a certain number of distilleries. | generally all around; and unless the commita gallon, or at all events reducing it; I am not Those distilleries cannot have a monopoly of tee will give unanimous consent I will move particular as to the exact amount; put the pre- the business because they come in competition that the committee rise in order to terminate vious question on it, and pass it as soon as pos- with the foreign distiller who also manufactures debate in twenty minutes. There are, I besible. Hundreds of thousands of dollars are for export to the consuming countries of the live, no other amendments to be offered requirbeing stolen every day while we are debating world.

ing discussion, excepting one which I think a this subject. Tam satisfied that the machinery [Here the hammer fell.]

very good one; but I will confine my propois as good as it can be, and I wish to have the

Mr. SCHENCK. It was my purpose to

sition 10 closing debate upon the particular vote taken as soon as possible. If I cannot make some reply to the amendment offered by subject of the amount of the direct tax. I ask get the tax reduced to twenty-five cents I will the gentleman from Wisconsin, (Mr. Paine,] ll unanimous consent that debate on that quesagree to thirty, fity, or even sixty cents. But || but the gentleman from Massachusetts, [Mr. rion be closed in twenty minutes. I prefer it should be twenty-five cents.

BOUTWELL,] although renewing that amend- Mr. INGERSOLL. I object. (Here the hamıner fell.]

ment, has submitted to the House most of the Mr. SCHENCK. I move, then, that the Mr. PAINE. I withdraw the amendment views, anticipating mine, against its adoption. committee rise for the purpose of terminating to allow the gentleman from Masdachusetts to I was going to put my opposition to the amend- debate. renew it.

ment mainly upon the ground of the question On the motion there were-ayes 69, noes 30. Mr. BOUTWELL. I renew the amendment of revenue which it involves. In their anxiety

So the motion was agreed to. not because I favor it, but for the purpose of to bring about a wholesome condition of things, The committee accordingly rose ; and the objecting to the policy of reducing the tax as it is supposed, in the collection of the tax Speaker having resumed the chair, Mr. Blaine materially below the report of the committee. on whisky, so as to prevent evasiun ard trands, reported that the Committee of the Whole on It is useless to suppose that the reduction of gentlemen must take care that in their under: the state of the Union bad, pursuant to the the tax even in twenty cents will operate very bidding of each other they do not come to a order of the House, had under consideration the essentially in the way of deterring persons from point where we shall cease to have that revenue Union generally, and particularly the special attempting to defraud the revenue. These which we ought to have and which we must order, being House bill No. 1284, to change aitempts were inaugurated when the tax was have from whisky, tobacco, and articles of this and more effectually secure the collection of twenty cents, and they will be renewed and kind, unless we are to be thrown back upon internal taxes on distilled spirits and tobacco, persevered in even if you put it at twenty | oppressive taxes to be imposed upon other and to amend the tax on banks, and had come cents. At present the objeci to be looked ai industrial pursuits.

to no resolution thereon. is to raise from the tax on distilled spirits money Now, sir, I suppose the production of dis- Mr. SCHENCK. I move that when the enough after making due allowances for such tilled spirits to be from eighty to ninety million

House shall again resolve itself into the Comfrauds as will be committed to enable the || gallons. The whole tax imposed by the pro

mittee of the Whole on the state of the Union Government to go on without returning to the || posed bill, then, will scarcely bring the amount upon the special order, all debate upon the taxation of those articles which have been of tax up to the $70,000.000 estimated by the amount of direct tax on distilled spirits shall exempted by previous legislation. Assuming Committee of Ways and Means as being neces. terminate in twenty minutes. that we can collect the tax on eighty million sary in order to help out the other taxes for Mr. INGERSOLL. Say thirty minutes. gallons, as we might with honest and efficient the support of the Government.

Mr. SCHENCK. I yield to the importunipublic officers, at sixty or seventy cents a gal- But if the proposition should prevailto reduce ties of a great many gentlemen, and modity my son, we have a revenue of fifty or sixty million the tax to thirty-five cents instead of sixty cents, motion so as to limit debate to thirty minutes. dollars a year from distilled spirits, and this including these indirect taxes as a part of the The motion was agreed to. revenue is needed to enable the country to avoid fifty cents, which is assumed to be all that is

MESSAGE FROM TIIE PRESIDENT, getting into debt or imposing taxes on articles necessary in the aggregate, we should get below already exempt.

A message in writing from the President that standard, even if we collected the whole

of the United States was presented by Mr. W. The pointro which I wish to direct the atten- tax, and there must necessarily be a deficiency

G. Moore, his Private Secretary. tion of ihe cummittee is this: that we cannot of some twenty, thirty, or forty millions, probbe justified before the people of this country ably about thirty millions. I believe, sir, that in reducing the tax below the revenue wants something equivalent to that which is proposed Mr. SCHENCK. I move that the rules be of the Government without making anoi her by the committee can, if enacted into a law, suspended, and that the House resolve itself effort to collect it at that point. We abandon be enforced, and that up to that point we can,

into Committee of the Whole on the State of the tax of two dollars a gallon because it has with reasonable certainty, count upon a collec- the Union, and resume the consideration of the proved, under the circumstances that exist, tion of the taxes.

internal tax bill. impracticable to collect it; but we are not But the gentleman from Wisconsin is wrong, The motion was agreed to; and the House jusritied in putting the tax below the revenue it seems to me, in another proposition. He | accordingly resolved itself into ibe Commuittee wants of the couutry until an effort shall have counts as a part of his fity cents this three, of the Whole on the state of the Union, (Mr. been made, extending beyond the term of the four, or five per cent. on the aggregate of the BLAINE in the chair,) and resumed the consid. present administration of the Government, wholesale and retail dealers sales. That is eration of the special order, being the bill when we hope to have our revenue laws better nothing to the distiller. That is a tax imposed (H. R. No. 1284) to change and more effectadministered than they are today. If we put upon the trade in this article after it has been ually secure the collection of internal taxes on the tax below fifty cents we certainly shall be produced and has passed out upon the market distilled spirits and tobacco, and to amend the deficient in the necessary revenue to carry on of the country, and therefore it is not fairly to tax on banks. the Government, and I think there is the piv. || be counted as a part of the fifty cents.

The CHAIRMAN. By order of the House otal point upon which we should legislate at My colleague [Mr. EGGLESTON] complains all debate on the question of fixing the amount this time. I do not accept the theory that even that we have not adopted a system suggested of taxation per gallon on distilled spirits will at twenty cents you will drive distilling back by him at some former time, of farming out terminate in thirty minutes. The pending to the grain growing districts. Unless the tax

the tax.

All I have to say on that point is question is upon the amendment of the genis collected in the maritime ports, if it is col. that under the Governments of some of the tleman from Massachusetts, [ Mr. BoutweLL) lect-d in the grain-growing district, it will be eastern countries this system of farming out

Mr. BOUTWELL. I withdraw the amendcheaper to send the grain to New York and taxes has been tried, and being made a matter ment. Other maritime ports where there are oppor. of individual speculation has become so hate. Mr. COVODE. Mr. Chairman, I desire to. tunities of defranding 'the Government and ful that even the submissive people of hose renew the amendment offered some time ago evading the payment of the tax and manufac. countries have risen against it. If we should by the gentleman from Missouri Mr. Piej 10 ture the whisky there than to manufacture it attempt in this country to let it body of private strike out “sixtyand insert “ forty,'' so as to in the West and pay the tax there.

indiviñuals have the benefit of some fifty, sixty, make the amount of the tax forty cents per


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gallon. I had come to the conclusion, Mr. could have been enforced; and if a committee impose a higher tax the law cannot be enforced. Chairman, that filty cents is the proper amount had been appointed by this House and used A whisky ring scares Congress out of its adherat which to fix the direct tax; but since learn- the same energy as the committee used in ence to duty and propriety, and regulates our ing that the bill, as reported by the committee, looking up the evidence against the constitu- legislation at its will. Such is a fair statement contemplates au indirect taxation of from six- tional head of this Government, I say that of the proposition, and what cowards we are! teen to twenty cents additional, I have become those who have violated the law in reference The fault, sir, is not in the law. The diffisatisfied that this will place the aggregate tax. to this whisky tax would before this time bave culty is not in the alleged fact that combinaation so high that there will be room for enor. been brought to punishment.

tions of wicked men can at pleasure defeat the mous frauds.

Now, sir, if we go on legislating in this way execution of the law. The fault is in the Gov. Prior to the war the southern States con- this " whisky ring,' or the men who are set- ernment itself. The law is good enough. The sumed annually thirty million gallons of whisky, ting the law at defiance which fixes the tax on two-dollar tax can be collected. In order to manufactured principally in the North and whisky at two dollars a gallon, will set a law execute the law we must have for the chief West. Now the southern people make their at defiance if the tax be fixed at fifty cents or revenue officer a man of large intellectual own whisky, and they make it, to a large ex- any other sum. I say it is due to the dignity endowment, of iron will, of marked executive tent, without the payment of the tax. When of the Government that, instead of repealing power. The various subordinates should be I was in Louisiana, two years ago, my atten- the tax on whisky, this House should take such responsible to him and subject to his coutrol. tion was called to six extensive distilleries then measures as will bring those who violate the When a subordinate proves himself to be inca. being carried on in Rapides parish, and pay- law to a proper punishment, and the energy of pable or dishonest he should be turned out, ing neither tax nor license. Some months ago this House ought to be brought to bear for that and politics should have nothing to do with it

. I received a letter from Dr. Waters, secretary purpose. When the majesty of the law bas My own State, sir, has nothing but a general of the convention then in session at New Or- been established, and not before, let us legis- interest in this matter. I do not suppose that leans, stating that those distilleries continue to late for the reduction of this tax.

there has been a gallon of whisky distilled run, and do not pay one cent of tax or license. Mr. WOODBRIDGE. I move to insert two within its boundaries for many years, and perThe great object in reducing the tax is to put dollars a gallon.

haps there is as little drank there as in ang an end to the frauds which have existed;


Mr. PAINE. I rise to a point of order. As section of the country. All our people are if a specific tax of fifty cents per gallon should the question stands there is no chance for that burdened with taxation, and it is our duty to be adopted as the aggregate of the taxation on motion.

lighten that burden as far as possible, and at whisky, I believe we could thereby accomplish The CHAIRMAN. The gentleman is cor- the same time preserve every national obligathe object sought; but if there be in addition rect, but the Chair will explain. The pending tion according to the letter and the spirit. an indirect tax of sixteen to twenty cents, I amendment to the amendment is to insert My policy would be to tax whisky and believe we cannot accomplish that object. At | thirty-five cents. The bill which the Clerk will tobacco, articles of mere luxury, heavily, and the present time the South is not only making read is very obligatory that it is not in order to with a fair and moderate tax upon petroleum, its own whisky, but is sending into the North strike out what has once been inserted.

stamps, and two or three other articles, raise for sale whisky that has never paid the tax. The Clerk read as follows:

the required revenue. We must break up this system of fraud, and "Although it is not in order to strike out by itself [Here the hammer fell.] in endearoring to do it let us take such meas

what has been inserted, it may be moved to strike Mr. ORTH. Mr. Chairman, in the very ures as to accomplish it at once.

out a portion of the original paragraph comprehend-
ing what has been inserted, provided the coherence

limited time allotted us by the order of the Mr. GRISWOLD. I desire to suggest to the to be struck out be so substantial as to make this House it is impossible to do anything like gentleman from Pennsylvania (Mr. Corode] effectively a different proposition."

justice to so vast and interesting a question as thatshe loses sight of the fact that the aggre. The CHAIRMAN. If sixty cents be stricken the one now under consideration. gate of this tax is distributed. An aggregate

out and any other sum inserted it will cut off Revenue and taxation in their various forms tax of seventy-five cents, distributed among all further amendment on that point; and the always affect to a greater or less extent the the distiller, the seller, and the consumer, is no Chair has thought it agreed with the pleasure business interests and commercial relations of greater practically than would be a tax of fifty of the House to allow a wider range of debate

a people, and hence the legislator should exercents at the still.

than that rule would call for, of course, within cise his power over these measures with great Mr. COVODE. I understand that; but if the thirty minutes to which the debate has caution. A change of taxation, either in its you examine the proceedings of the court at been limited.

amount or its mode of collection, will to some Richmond a few days ago, you will see that Mr. PAINE. I withdraw the point of order. extent affect the values of property; it may the men engaged in perpetrating frauds on the Mr. COVODE. I withdraw my amendment. depress oue species of property and appreGovernment know how to get over everything

Mr. WOODBRIDGE. I now move to in- ciate another species; and we sbould prevent, of that kind. Four of them paid the Govern- sert “two dollars."

if possible, too great a difference in these ment officer $30,000 for permission to cheat Mr. Chairman, it will be recollected by extreines of appreciation or depression. Our the Government out of $250,000 a year; and yourself and others who were members of the people, with singular unanimity, have long then, upon being found guilty in court, they are | ThirtyEighth Congress, that when the internal since agreed that alcohol, (or whisky,) for many sentenced to pay the enormous fine of $1,000 revenue law was inaugurated in the course of reasons, should be made to bear a very large or upward, and to un.iergo an imprisonment the discussion two views were taken in regard | proportion of the public burdens. How best of one year or more.

to the tax on whisky, one that it should be to accomplish this object has for years engaged Mr. Chairman, I represent a district which taxed heavily, because its use was immoral, the attention both of the public and of coupays more tax on whisky than any other dis- and the other because it was an article of lux. gress. Could the present tax be collected by trict of the United States. I believe that in ury. I then thought it should be considered the officers of the Government and placed my district will be found the largest number like any other article of commerce, and that, in the national Treasury there would be no of distillers that have acted in good faith. || although its improper use engendered immor- demand for its reduction. They have been shut out from the market for || ality and vice, other considerations were more But it is a melancholy fact that our laws are the last six months. What I desire is that the important in determining the amount of the tax evaded and disregarded. Interested parties Government shall collect the tax; and if it which should be imposed. After much exam- and corrupt officials are appropriating to themwere possible to collect the tax of two dollars ination and discussion Congress settled upon selves millions of dollars of the public revper gallon I would never propose a reduction, two dollars a gallon. At the time this seemed enue, thus defrauding the national Treasury but they have not collected one tenth of that to be satisfactory to the country. No such and increasing the burdens of the honest tax•

difficulties in the execution of the law appeared payers of the country, and we have now to [Here the hammer fell.]

as to induce the Thirty-Ninth Congress to meet the question whether we shall permit Mr. ARCHER. Mr. Chairman, this House diminish the tax. We are now, however, told such a state of affairs to continue longer, to the is proposing in this bill to make what seems that the tax must be reduced in order to enable

disgrace of the country both at home and to me to be a strange admission, that a law of us to collect it, or, in other words, that in our abroad. the United States providing for the collection || law-abiding and law-respecting country there It is most humiliating, but the fact stares us of a tax cannot be enforced. Now, sir, if this is no power whereby the law, as it pow stands in the face, and cannot be controverted, tbat Government is the Government that we have in this regard, can be executed.

this Government is not to-day able to enforce always supposed it to be, the present tax on

Such an assertion is an assault to our Gov. its laws for the honest collection of the rev: whisky ought to stand. And I say it ought to ernment and our people. All I suppose will enue on this particular species of property. stand if for no other reason than the vindica- admit that the article of whisky, so far as tax. I have not the time to enter at length upon tion of the Government. If this country could ation is concerned, must be regarded as a the causes which produce this sad result; but enforce its laws against ten million people luxury, and all will also admit that it is wise

most prominent is the belief that the executive in arms against it, I say it presents a strange political economy to obtain revenue from lux- branch of the Government is derelict in its spectacle if it cannot enforce a law to collect uries so far as possible. Thereby the produc- duty, and offers no effective resistance to the the taxes.

tive industry of the country is relieved, and the rings of plunderers who now appear to conMr. Chairman, if the energies which this price of those articles which necessarily enter trol it. House has displayed and its committees have into the consumption and comfort of the labor.

To the legislative department of the Govern. displayed for the last three months in investi- || ing man reduced. Upon this ground whisky ment there is but one remedy left, and that is to gating the impeachment or the evidence against can well bear the tax of two dollars a gallon. reduce this tax to such a point as will enable the President, had been used in the investiga. It is now proposed reduce the tax to sixty the honest manufacturer of whisky to compete tion of the frauds against the Government or cents. The only argument in favor of such with its illicit production. That point, in my this question of the whisky tax, its collection || reduction, so far as I have heard, is that if we judgment, is that which places the tax nearest



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