The Portland daily press., 1898-06-10
pRAWBAcKON ALCOHOL
Manufacturers Would Make Export Bust
ness Comp ensate for Loss of Domestlc'

(From New York Journal of Commerce.
May 20, 1882
American manufacturers who use alco-
hol in their industry have for long
period made efforts to secure an ameno-
mnent to the internal revenue laws CIV
Ing rebate of the tax on alcohol USED III
the manufacture of goods exported TO ior-
eign countries. The justice OF THIS oe-
mand is, they claim, not questioned py
Congress, which has acknowledged une
principle involved by granting a rebate
OF the tax paid on imported alcohol. BUT
while extending this favor to foreign al
cohol the Government has refused to give
the same privilege to the domestic pro-
Duct The result Of this policy has been
to discourage our export trade in many
lines of goods, and to encourage the use
of foreign alcohol in preference to the
grain alcohol Of this country.
D For this unwise and unjust discrimi-
nation against an important American
product there is absolutely no excuse"
said gentleman who is interested in the
matter. There is no pretense that the
Government revenues would suffer, since
If the alcohol is not exported it is not
used, and therefore no revenue is now
derived from it. The only attempt at
argument in favor of the law, as 1t now
stands, is the alleged danger of frauds
IN the use of alcohol in manufacturing
for export. / But there is certainly no more
danger of fraud in using domestic alcohol
than with the foreign product as now per-
mitted.
"The case In favor of changing the la W
SO as to allow the use of domestic alcohol
in manufacturing for export is thus CON
oisely stated in the views of Senator o.
II. Platt, airman of the Joint Select
Committee OF Congress on Alcohol in the
Manufactures and Arts, and Representa-
tive Chas. A. Russell, Of the same COM
mittee, accompanying their report Sub
hitted to Congress Dec. H. 1897,
SIN this connection we desire to express
our surprise that the use of foreign alco-
hol. free Of tax, In the production Of ar
ticles for export is allowed while the
domestic alcohol is taxed. There can be
no reason given why this discrimination
in favor of foreign alcohol and against
our own product should exist. If any
alcohol is to be free from taxation when
unou III mauuiaouiiitnS ~ euouiu certainly
be the domestic article. 1t is an unsound
policy which encourages the use of for
eign product at the expense of an equally
good or better domestic product, but I'M
der our laws as they exist today, in this
regard, this strange anomaly ia presented:
That it is possible for manufacturer to
buy domestic alcohol, export 1t, use 1t in
the manufacture of articles for export
free Of any tax whatever, and yet he must
pay tax of 1900 per cent If he uses the
same domestic product without having
first exported and reimported it. If there
Is any danger that fraud will be perpe-
trated by the allowance of domestic tax
free alcohol in the manufacture of articles
for export that danger is precisely the
same in case imported alcohol is used. If
discrimination Is to be practised Gas be.
tween foreign and domestic products) it
would seem wiser to discriminate in our
own favor. Whatever else may seem judi
cious in the way of legislation to relieve
QUE industries of the burden Of this inter
nal revenue tax upon alcohol, persons
manufacturing for export ought surely to
have the same opportunity to use 1t I'M
taxed that they now have to use foreign
ALCOHOL.
I'm addition to the arguments so con-
vinoingly presented there Is at this time
an especial reason hyCongress should ex-
tend to manufacturers the right to use
domestic alcohol. The internal revenue
bill now before Congress imposes in
creased taxation on a large number of
articles in the manufacture Of which large
quantities of alcohol are used.
1.-The effect Of the new internal revenue
taxes on these articles will be to increase
their cost and decrease their SALE Under
these conditions the only recourse for the
manufacturers of such articles is to find.
If possible, new,,marketssfo for their products.
These markets must be found in other
countries, and in order to sell goods of
which alcohol Is material part In COM
petition with England, Germany, Francs
and other manufacturing countries which
have the advantage of untaxed alcohol, 1t
is absolutely necessary that our manufao
tuners should be allowed rebate of the
tax paid on all alcohol entering into pro-
ducts exported.
"Since these manufacturers are called
upon to contribute largely to the Govern
Dlent's revenues at this crisis 1t is only
fair that they should be given an oppor-
tunity to recoup themselves for their loss
es by building up an export trade. The
proposed change would not cause the Gov
eminent the loss of one cent of revenue;
would greatly stimulate our foreign COM
MERGE in many articles: would create an
increased dem"nd for grain alcohol. and
thus aid the farmers by increasing the
consumption of corn, and would put
American manufacturers on an equal foot
ing with their foreign competitors in the
markets of the world