Page:Popular Science Monthly Volume 48.djvu/345

Rh found little favor in respect to its recommendation of tax abatement; and the general sentiment both in and out of Congress was expressed by a leading member of the House of Representatives, who publicly declared that "he was not ready to admit that the nation which had put down such a great rebellion at the cost of so much blood and treasure could not collect a tax of two dollars a gallon on whisky." The two-dollar tax therefore was allowed to remain in force, and the tax experiences of the United States from 1865 to 1809 inclusive, in respect to spirits, viewed from the standpoint of finance, economics, and morals, constitute one of the most interesting, instructive, and disgraceful chapters in its history. Under the strong temptations of large and almost certain gains, men rushed into schemes for defrauding the revenue with the zeal of enthusiasts for new gold fields; and the ingenuity of the American people has never had more striking illustrations than was offered in their devices for evading the tax and providing for security against detection and punishment in so doing. The parties concerned in these transactions also showed throughout more ability than Congress and more shrewdness than the revenue department of the national Treasury; and at a later period a Secretary of the Treasury was obliged to resort to the use of a cipher for his telegraphic and written correspondence, in order to prevent the frustration of his plans for the enforcement of the laws by Treasury officials who were specially charged with their administration. The evidence in part confirmatory of these statements is as follows:

The revenue directly collected during the fiscal year 1866 (the first full year under the two-dollar tax) from spirits distilled from other materials than fruits was $29,198,000, and in 1867 $28,296,000, indicating an annual product respectively of 14,599,000 and 14,148,&shy;000 gallons. But during the succeeding year, 1868, with no apparent reason for any diminution in the national production and consumption of spirits, and with no increase, but rather a diminution, in the volume of imported spirits, the total direct revenue from the same source was but $13,419,092, indicating a production of only 6,709,546 gallons.

As the consumption of distilled spirits in this latter year was probably not less than 50,000,000 gallons, and as out of this the Government collected a tax upon less than 7,000,000, the sale of the difference at the current market rates of the year, less the