The Newberry herald and news. (Newberry, S.C.) 1884-1903, 1893-09-20
WELLS ON INTERNAL TAXES.
The Tariff Reformer Tells How to Increase
the Revenue.

tariff reformer, has submitted lengthy
report to Secretary Carlisle in answer
to his request for an 'opinion as to the
expediency, from a strictly revenue
point of view, of maintaining or chang
ing the present internal revenue taxes
on distilled spirits, malt liquors and
tobacco"
Mr.. Wells conclusions are given as
follows:
1.-The wisest fiscal policy for the Fed
eral government, certainly for the i'm
mediate future, would seem to be to
impose the maximum rates of taxa
ton on distilled spirits, fermented
liquors, and tobacco, that will not Gre
ate in face of efficient administration
and severe penalties, undue tenlpta-
tions for revenue evasions. In the
case Of distilled spirits, on which the
existing rate under the most favorite
conditions of production is always in
excess of 300 per cent. on their first
cost, or taxable unit, this line seems
to have been absolutely ignored, but as
the experience of recent years shows
that the revenue from this source is
increasing in ratio equal to or in excess
of the increase of population, and the
amount of illicit product comparatively
small, any change in the present tax
would seem clearly inexpedient.
"Cn the other hand, in the case of
fermented liquors aud tobacco, the ex-
isting taxes are far below the safe line
of expediency, and might be advanced,
i. e., to the extent Of 81 per gallon or
one-ffth of cent on the half pint in
respect to the former, and in the latter
atileast, to the rates imposed in 1882,
! with great advantage to our national
revenue and to 9 greater simpli6cation
of our whole fiscal system. Certainly,
if additional revenues to meet present
existing and extraordinary require
ments for expen litures are needed, it
would be difficult to show where an
immediate annual increment-with a
certain large annual increase of the
same in the future-could be obtained
with less of expense and popular fric-
ton than by the tax notifications sug-
gested.
"The existing custom duties on the
imports of spirits, fermented liquors,
and tobacco are exceedingly high and
absurdly disproportionate to the cor
responding internal revenue taxes on
the same, and can undoubtedly be
| modified to some extent to the ,ad-
vantage of the revenue. Thus, on i'm
ported spirits the duties are 81 per
proof gallon and the internal revenue
tax 90 cents; on fermented liquors the
relative rates are 20 cents and 32-5
cents per gallon, and on snuff, chewing
and smoking tobacco, 50 and 40 cents
and 6 cents, respectively. In the
United Kingdom, where the produc-
tiyity of taxes has been carefully stud
led, the custom duties exceed the ex-
else (ipternal revenue) taxes upon beer
by Cd. Q2 cepts) on thirty~six gallons,
and upon spirit i'd. Is cents) per proof
gallon.
"One effect of the maintenance Of our
excessively high duties on imported
spirits is that greater opportunity is
offered to combinations Urusts) of do
mestic producers to advance the price
! of domestic consumers; and another is
that they encourage the domestic man
ufacture from cheaper materials Of imi-
tations Of foreign spirits, whereby the
| American consumer is induced to use
a spurious in place ofthe genuine arti-
Gle, and the Government is defrauded
of the difference in relative taxation,
an amount believed to be very consid-
erable."
Mr.. Wells estimates that by the
changes be proposes the internal reve-
nue. from fermented liquors would be
increased from S32 900, 900 to s64,00O,-
900, and from tobacco from S32, 10000
to s60,000,00O. Also that The customs
revenues from imported spirits, wines
and beer would be increased from S9,-
oOO 900 to SlO,OOO,000, and from tobacco
from s13,O0O,O0O to Sl6,000,00U. The
aggregate receipts from internal reve-
nue. taxes and customs duties on these
three commodities he thus estimates
would be increased from SlS0,O00, 900 to
s245 100000. He concludes:
"It is therefore obvious that from
taxes judiciously imposed on only three
commodities of branches Of industry,
the Federal government can at the
present time certainly, economically,
aud with less burden and disturbance
to it's people than by any other form Of
levy, collect an annual revenue sufti-
cient 10 defray all of its ordinary ex-
penditures, including interest on all IFS
debts, and lave in addition an annual
surplus of SO coo 0C0, leaving lis total
revenue from other sOuIcCs- l. c., I'M
port duties, less those collected from