Evening star., 1895-05-31
TO RAISE REVENUE
There Will Be a Deficit of Many
Millions.
OVERTHROW OF THE INCOME TAX
And the Fall in the Price of Sugar
the Cause.
SUGGESTIONS CONSIDERED

The propriety of providing some addi-
tional source of revenue for the govern
ment during the life of the present Con-
gress, which meets in December. Is no
longer seriously denied at the Treasury
Department 1t Is not believed that there
will be any pinch in treasury conditions
for a long time to come even without ad-
ditional revenue. but it is thought desir-
able to have a small annual surplus In view
of the demands of the sinking fund, which
have not been met since 1891, and in view
of the difficulty of maintaining gold pay
meIts when the gold reserve is reduced and
the entire volume of government paper
currency is in circulation. There are now
locked up in the treasury s77,744,61O In
United States notes and $29.210,514 in
Sherman treasury notes and so, ,21O,514 in
withdrawal from circulation Of more than
one-fifth of the government paper money
Is believed by many to be powerful
help in maintaining the gold standard and
preventing redundancy of currency.
Included in the Treasury Balance.
This money Is included in the 1854, ,9S3, ,O64
which appears as the general treasury
balance. and a reduction of this balance
by a monthly deficit would compel the
treasury to choose between the release of
the legal tender paper or the direct re-
duction of the gold reserve by using 1t in
current disbursements.
The present balance would cover month
ly loss of $3OOO,OOO for nearly a year, and
a reserve fund of about $1O,OOO,OOO Is still
due from the bond syndicate before the
balance would be reduced to $1JO,OOO.OOO.
This would have been considered a salts
factory working margin before the infusion
of tho Sherman ootes into the currency.
Secretary Carlisle recommended, as safe
guard against this new imitation, that he
be empowered to increase the gold reserve
by the issue CT short-term bonds, and 1t Is
felt that the ability to lock up a part Of
the lesal tender paper in the treasury bal
ance accomplishes a part OF the purpose
of a stronger gold reserve.
Mr.. Cnrlixle's Estimates.
So far as current receipts and expendi-
tures go. it is believed that Secretary Car
isles estimates will not prove far wrong
when allowance is made for the overthrow
of the income tax and the fall in the price
of sugar. His estimete of receipts of $424,
427.74s TO- the present fiscal year, includ-
ing sSt.427,74s from the postal service,
would have been almost exactly verified IL
$50 0OO, 900 had been collected from the in
come tax. as was expected. Secretary Car
Isle estimated deficit for the year ending
be increased to $5O.OOO.O0O by the over
throw Of the income tax. The estimates
for 1896 called for collections of $4769O7,-
4O7, including $s6,9O7, ,4O7 from the postal
service, and involved expenditures of $44S,-
D92. 1856, showing a surplus Of $2S. .S14, $40.
Surplus Wiped Out.
This surplus will be wiped out by the
overthrow OF the income tax, and there
may be a deficit of several millions on ac-
The estimated revenue from sugar after
the tariff should be in full operation under
normal conditions was $43 47s.957, but this
was based upon the price in 1S93 which
was over 8 cents per pound free of duty.
The fall Of the price below As cents
makes radical difference under the ad
valorem duty of 40 per cent, and will cut
down the revenue to about $25,OOO,OOO. 1t
Is this deficit which the treasury officials
admit may require to be covered by new
legislation. as the accounts would almost
exactly balance, even without the income
tax, II the price Of sugar had remained
uniform.
Suggestions at the Treasury.
The manner Of meeting this deficit may
involve some sharp political fencing be-
tween the President and Congress. The
plans which are under discussion at the
Treasury Department involve a duty on
tea, which would furnish about $1,000, 600
at the rate Of 10 cents per pcurd; an addi-
tional tax of 81 per barrel on beer, which
would add about $4,000, 900 to the revenue,
and a stamp tax on checks or other busi-
ness paper, whose yield has not been ac-
curate1y figured. None of these plans has yet
been decided upon, but they have all been
suggested and have been the subject of
some discussion. The duty on tea might
be enacted II the new Congress were dem
ocratic but 1t is regarded by the republi-
cans as an entering wedge for the policy
of free trade and is not likely to have their
support under any circumstances.
The beer tax has good deal of republi-
can support and was recommended to Sec
retary Carlisle before the framing of the
present tariff law by the eminent economic
student. David A. Wells of Connecticut
It would probably receive prompt approval
from President Cleveland If passed by
stamp tax would cause much discussion,
and it is doubtful If it would be sanctioned
under existing conditions by either political
party.
When Real Fun Would Occur.
The real fun would occur IL the repub-
licans of the Senate were strong enough to
Join those of the house in passing a bill
increasing tariff duties and restoring the
duty on raw wool. President Cleveland
would undoubtedly refuse to sanction a
restoration of the wool duty or any marked
increase in tariff rates, but If the treasury
was afterward embarrassed for lack of
funds, the republicans would endeavor to
fasten upon him the exclusive responsible
ity for failure to approve their scheme Of
raising revenue.