The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1870-07-02
C0ngress--TaxinG Interest ON Government
H0nds-The Funding Bill.

Concentrating Interest ON Government
E,onds-The Funding Bill.
Daring the consideration of the Tax bill by
the Senate yesterday the proposition to tax
the interest on government bonds was re-
sumed, Mr.. Bayard arguing that only in this
manner could certain species of property be
reached which had no claim to exemption
from taxation. The republican Senators
| generally combated the proposition as direct
reputation, as unconstitutional and dishonor
able, and as being an effort to create an income
| tax discriminating against government bonds
The amendment was lost by a vote of IL yeas
to 3G nays, Messrs Fowler, Pratt, Spencer
and Sprague voting 'aye" with the demo-
Gratis. An amendm emit to tax incomes from
bonds five per cent received the same vote,
with the addition of Mr.. Fenton, who had
previously expressed himself in favor
OF such measure. MIR. Sherman moved
10 amend so as to retain the tax on gross
receipts, the striking out of the income tax
rendering the continuance of other taxes
necessary. This amendment was also rejected
In The evening session the vote striking out
the income tax was reconsidered, and Mr.
Wilson moved to amend by continuing the tax
until the end of 1872 at the rate of two and a
half per cent which was agreed to. The ques-
ton then being on striking out the income tax
as amended, the Senate refused to strike it
out, thus restoring the tax.
The advent of our national holiday has
| aroused the Indignation Of our orators and
statesmen against the British lion, and that
animalmust prepare for his annual fagellation.
| Among tbe earliest champions in the field is
! General Butler, who yesterday offered in the
| House severely bellicose resolution request
| ing the President to demand of the British
| government under what pretence of right or
| under whose orders, American fishing vessels
| have been arrested and detained while crus-
/ adopted, and accordingly the public will soon
! be afflicted with an Internationally long cor
| respondence between the two governments on
the fishery question. The Funding bill being
under consideration, Mr.. Holman, Of Indiana,
moved to amend the fourth section by provid-
| ing that the five-twenty bonds shall be paid in
greenbacks. Happily, this proposition met
with little encouragement, and was rejected
| by vote of az yeas to 1873 nays-four
republicans voting in favor of the amendment
and six democrats against it. An important
amendment was agreed to prohibiting the Sc
cretary of the Treasury from using other funds
for the redemption of five-twenty bonds except
such as he may lawfully apply to such purpose
| or which may be derived from the sale of four
| per cent bonds. General Butler endeavored
| to get in an amendment prohibiting the re-
demption Of securities before maturity, unless
as such time greenbacks shall be at par; but
the House rejected the proposition by twenty
four majority. General Butler also endeavored
TO have stricken out the fifth section. which
| authorizes The Treasurer to receive gold on
deposit and issue therefor certificates bearing
three per cent interest. Mr.. Schenck defended
the section, as containing the most important
provision Of the bill and as being essen
tiaI to its operations. If adopted the ultimate
effects would be "a general rise of all
government obligations to par and return to
specie payments. Mr. Schenck informed the
House that no reasonable doubts could be
entertained Of the ability of the government to
dispose of the four per cent bonds, as assur-
ances had been received within few days
| from French bankers Of their readiness to take
the bonds if they were of the character pro-
vided for in the first section of the bill. Mr..
Cox expressed his appreciation Of the main
features of the bill, his only remaining objec-
ton being the exemption Of the bonds from
taxation. Mr.. Coxs remarks were severely
criticised by several Western democratic mem
bers, who said he represented Wall street
rather than the democratic party, and called
his attention to the fact that the democratic
convention which nominated Seymour and
Blair declared in favor of paying the national
d .bt in greenbacks. At four o'clock final
vote was taken on the bill, when the House
substitute for the Senate bill was adopted and
passed