The tri-weekly standard. [volume] (Raleigh, N.C.) 1866-1868, 1867-11-28
TIE COTTON TAX.

TIE COTTON TAX.
REPORT FROM COMMISSIONER WELLS IN FAV'
, OR OF IT'S REPEAL.
TREASURY DEPARTMENT.,
OFFICE OF SPECIAL Con-. OF THE REVENUE,
WASHINGTON, Nov. .21st, 1867.
Tile Hon. HUGH McCULLocH, Sec'y. Of the
Treasury.
SIR AS the question of the repeal OF
the Internal Revenue tax now levied upon
law cotton is likely to be brought to the at
tention of Congress at an early day, have
thought it expcdient to anticipate so much
of my annual report us relates to this sub
ject, and accordingly herewith submit to you
the accompanying statement, with the re-
quest that the same, if approved, be trans
mitted to Congress.
To this statement there is appended the
report of the Committee of the Commission
ers of the United Stntes to the Paris Expos
ition, to whom was referred the consdera-
ton and examination of the samples Of cot
ton there eShlbited-a document which it
has seemed desirable should be made public
at the present time, rather than to allow the
same to be delayed until the complete
sioners,
When the Internal Revenue tax of three
cents per pound was imposed upon raw cot
ton by the act of July 13, 1866. the average
price of AIiddling" cotton in New York
for the preceding 12 months had been in eX-
cess of 40 cents per pound, and for the IL
months next succeeding was in excess of
20 cents per pound; at which range OF pri-
ces the tax in question was undoubtedly less
burdensome than the taxes imposed and
still maintained on other forms of domestic
industry
At the same time it has been generally as
sumed in almost all previous reports and de-
bates on the subject, that the tax on cotton
was temporary measure, called for and on
ly to be defended on the ground of the ne
cessities of the nation, and to be repealed at
the earliest moment when its continuance
seemed likely to prove serious impeachment
to domestic production, or an undesirable
stimulus to the foreign cultivator. That
these contingencies are now imminent, and
that the time has arrived when the policy of
raising revenue from tax upon cotton
should no longer be adhered to, will it is be-
ieved, appear evident from the following
facts and statistics:
The principal competitor to the United
in the production of cotton is India, and
the price of India cotton has been materially
advanced during the past five years through
two agencies-first, by improvements in ma
chlnery Tor It's manufacture; and secondly,
IN consequence Of an improvent in its quail
ty, due to increased care in handling, to the
use of exotic seed, and to the transfer of ma
tive seed from districts which have here
tofore yielded the best staple to those
where the production has been inferior. 1t
is to this latter agency that the recent mark
ed improvement in India cotton is, perhaps,
more especially to be attributed than to any
other. But be the causes what they may, it
may be affirmed that where India cotton
formerly bore the relation of one half to two
thirds the value of American, it now bears
the relation OF two-thirds to three-quarters,
while portion of the crop is fully equal to
middling uplands for the manufacture of
heavy fabrics.
Evidence exists tending to show that the
present tax of two and "a halt cent per pound
on American cotton is equal to premium
of aG least so per cent upon the cost of rails
ing cotton in India, and by some authori-
ties it IS alleged to be even greater. The
tax, therefore, could with propriety be i'm
posed only while the aggregate supply of
cotton was less than the demand, and the
price consequently far above the normal
j
Europe in any one year was in 1860, when it
amounted to 4, 1871 900 bales equal to 1 ,S44,-
100000 pounds. Of this amount the Uni
ted States furnished IS per cent, and there
can be but little doubt that a surplus of cot
ton goods was produced in that year, even
with the stimulus which the low cost of the
staple then prevailing undoubtedly afforded
to consumption.
In the year of 1866 Europe obtained
supply of 4;513,023 bales averaging 372
pounds each, equal to 1858, ia, 1856 pounds
of which less than 40 per cent was from the
United States. But this quantity, although
somewhat less in ponds than the supply of
1850, was too great for the demand for con-
sumption at the price ruling, and about 30O-
600 bales were added to the stock on hand
In European markets; which stock, on the
LIST of Jan. 1857, the close of the European
cotton year, was as follows: In Great Brit
ain, 5S1 $50 bales; On the continent, 16O, 900
bales; total, TAI $40.
Ii we estimate cotton at 400 pounds to
the bale Gas has been the custom in the Uni
ted States In the returns of the census.) the
comparative supply will appear as follows,
subject to slight variation, from the fact
that the cotton year of Europe is made up
to the LIST of JAM, and that of the United
States to the LIST of Sept-in bales of 400
pounds each:
CONSUMPTION OF EUROPE IN 1860.
american, about. 3,911,7 $50
Other varieties, 100000
Total 4,611,75O
SUPPLY OF EUROPE IN 1856.
American, about 900 GOO
'her varieties, 3,4s3, 1885
81 ,o'al' 1904 1885
ane consumption of Europe in 1882. the
year OF smalles. supply and of biabest ~;
1 1aS was 1oo,oOO, 900 pounds, or in bales of
4oo pounds, 1,s76,25O. The nronort;on Of
american cotton in this year was somewbot
.sas Ia Inan at latter date; but in 1894 #
ox aS iss SUI IMAM eight per cent of total Of
for ne ne crop of 1886, in the United States
I ~ 'pe year ending Sept. /, 1897. ia est;mst