trial by jury is secured by this bill, and other provisions friendly to personal rights are added. MR. GILES stated certain principles on which taxation should be formed. Taxes should be necessary, and raised on a plan consistent with the principles of liberty. The expediency of the present mode, he argued, from the impost's being carried to the utmost; from the approbation of this mode by a majority of the people, and, though uneasiness might prevail in some of the Southern States, he considered them as originating altogether from the want of due information. When, in June, 1794, Hamilton's plan was carried into effect, and duties were laid on carriages, sales at auction, snuff, sugar, and tobacco, the measure encountered vigorous opposition. The duty on carriages was declared by many to be unconstitutional, and in Virginia the collection of this tax was disputed until the Supreme Court of the United States declared in favor if it. In the debate on this bill the relative merits of direct and indirect taxation formed the chief issue. Those speakers who argued in favor of direct taxation were John Smilie [Pa.], James Madison [Va.], William Findley [Pa.], Samuel Smith [Md.], and John Nicholas [Va.]; the speakers in favor of indirect taxation were Uriah Tracy [Conn.], Theodore Sedgwick [Mass.], Fisher Ames [Mass.], and William L. Smith [S. C.]. DIRECT VS. INDIRECT TAXATION HOUSE OF REPRESENTATIVES, MAY 1-4, 1794 MR. SMILIE.-Taxes which are paid imperceptibly are more dangerous than others, because by their invisibility the people are seduced from thinking to what purposes their money went. MR. TRACY could not believe that the member was serious in advancing such a doctrine, for the sum of it is that when taxes are to be raised Government is in duty bound to give the people who pay these taxes as much trouble as possible! There was nothing but this alternative-a tax on tobacco, or a land tax-which was equivalent to a tax upon necessaries. MR. MADISON had always opposed every tax of this nature, The impost duties had been extended as far as was, in the opinion of any gentleman, dictated by sound policy. The tax on internal negotiations, which could not be carried on to any considerable extent without the intervention of stamps, was subject to the objection brought against the present bill, and that in a degree incomparably beyond it, of being opposed by public opinion. Direct taxes are still more objectionable on that account, at least in every part of the country to which his knowledge extended. They are of all taxes the most unequal, and in this country would be found the most oppressive. They are unequal, because, with whatever exactness they may be apportioned upon capital or income, the only two principles on which an apportionment can be made, they may, and will, be very unequal as to the burden imposed; because a man's ability to pay taxes is not in proportion either to his capital, his property, or his income, but to that part of his income which is over and above his necessary expenses, according to the usual manner of living for persons of his degree in the community. They will be oppressive in this country, because in many of the States the plentiful circulation of money, and the facility of obtaining it, does not extend to the interior parts, nor could it be obtained by many of our citizens without a great sacrifice of property. It may be added that, from the extent of our settlements compared with the number of our citizens, the expense of collection would be immense. In regard to excises, Mr. Sedgwick said that in all insensible modes of taxation it should be observed that a much greater sum would be obtained from an individual than by any mode of direct imposition; this, without entering into a discussion of the reasons upon which it is founded, is demonstrated by fact. He instanced the porters of London, from whom, in the single article of beer, were drawn ten times as much as could be procured by the most rigorous mode of direct taxation. With regard to the proposed duties, though the well-meant consideration of morality which had been urged by some gentlemen weighed but little with him, because he doubted whether it was well founded, yet, if the consumption, which at present amounts to an enormous quantity, should be lessened, he did not believe that it would be attended with any sensible inconvenience. MR. SMITH said the present bill was not so exceptionable on account of its violating private property as the collection law. He instanced, in a particular clause of that law, the power of entering houses by warrant from a justice of the peace trial by jury is secured by this bill, and other provisions friendly to personal rights are added. MR. GILES stated certain principles on which taxation should be formed. Taxes should be necessary, and raised on a plan consistent with the principles of liberty. The expediency of the present mode, he argued, from the impost's being carried to the utmost; from the approbation of this mode by a majority of the people, and, though uneasiness might prevail in some of the Southern States, he considered them as originating altogether from the want of due information. When, in June, 1794, Hamilton's plan was carried into effect, and duties were laid on carriages, sales at auction, snuff, sugar, and tobacco, the measure encountered vigorous opposition. The duty on carriages was declared by many to be unconstitutional, and in Virginia the collection of this tax was disputed until the Supreme Court of the United States declared in favor if it. In the debate on this bill the relative merits of direct and indirect taxation formed the chief issue. Those speakers who argued in favor of direct taxation were John Smilie [Pa.], James Madison [Va.], William Findley [Pa.], Samuel Smith [Md.], and John Nicholas [Va.]; the speakers in favor of indirect taxation were Uriah Tracy [Conn.], Theodore Sedgwick [Mass.], Fisher Ames [Mass.], and William L. Smith [S. C.]. DIRECT VS. INDIRECT TAXATION HOUSE OF REPRESENTATIVES, MAY 1-4, 1794 MR. SMILIE.-Taxes which are paid imperceptibly are more dangerous than others, because by their invisibility the people are seduced from thinking to what purposes their money went. MR. TRACY Ccould not believe that the member was serious in advancing such a doctrine, for the sum of it is that when taxes are to be raised Government is in duty bound to give the people who pay these taxes as much trouble as possible! There was nothing but this alternative-a tax on tobacco, or a land tax-which was equivalent to a tax upon necessaries. MR. MADISON had always opposed every tax of this nature, and he should upon all occasions persist in opposing them. If we look into the state of those nations who are harnessed in taxes, we shall universally find that, in a moral, political, and commercial point of view, excise is the most destructive of all resources. Much of the collection of this tax on tobacco would depend on the oath of the manufacturer, and this was but another term for the multiplication of perjuries. The tax would therefore injure the morals of the people. MR. FINDLEY.-Ruin and depravity have always attended excise. It has been one of the principal sources of the corruption of Britain. The same effects must follow in America. He objected to the mode of taxation; and, besides, the tax is partial. It falls on the poor in cities. In the country nobody will pay it. MR. SEDGWICK would vote against the tax if he thought it was contagious for public morality. But human nature has always been very corrupted without the aid of excise laws. The State which he represents has been excised for two generations, and yet no bad consequence has arisen to the morals of the people. As to the corruption of Britain, described by the member who spoke last, he admitted that the account was just, but this was not to be traced to excise laws. They had been the subject of much clamor, but what, in fact, was their history? A profligate opposition rail at all the measures of a minister, whether they be good or bad, and an excise act is often one of them. In the course of political changes these men get into place. But they do not attempt to take off the taxes against which they declaimed. In the meantime the new ex-minister harangues against the very taxes of which he was the author. As to this law being a source of perjury, oaths are necessary in imposts of all sorts. Why, then, object to them in this particular instance? Is an excise oath worse than a custom-house oath? There is often no other method of getting at truth. If we desert this way of raising revenue, what are we to do? Taxes cannot be imposed on personal income with any sort of justice, because the actual degree of a person's wealth does not depend on the nominal amount of his income. One man has a thousand dollars a year, but such may be his situation that the taxing him in so small a sum as ten dollars may be distressing. Others, again, with only five hundred dollars per annum, are, perhaps, in much more easy circumstances than the former, upon whom the tax of personal revenue would press with superior weight. Direct taxes Mr. Sedgwick regarded as of an improper nature. But, with regard to snuff and tobacco, nobody can ever feel the burden of a trifling tax upon them. MR. SMILIE considered this measure as pregnant with serious consequences. He was opposed to every system of excise, because such systems had always produced mischief. If this were a despotic country, he could see a good reason for an excise system of revenue, because it was proper, in that case, to debase, by every possible expedient, the minds of the people, that their feelings might sink to a level with the meanness of their condition. But in a republic taxes should be of a different nature and operate with a different tendency. MR. AMES had a better opinion of government than the gentleman who spoke last. He did not think excise a mark of despotism. He did not think the people stocks and stones, or their rulers knaves and fools. The member had spoken of the citizens of this country, as if to rouse their attention it was requisite to keep a flapper, like that of Gulliver, at their ears. As to the resolution upon the table, is there any comparison between a snuff tax and a land tax? Land is the great substratum of American prosperity. Difficulties had been started as to the collection of excise; an oppressive law was a bad thing, but resistance was worse. Can any man think that a land tax does not open a much greater door to imposition than a tax on tobacco? In what way is a land tax to be laid that can avoid inequality and injustice? Are we to tax the public funds, that last and most desperate resource of national distress, and then to be told that we dare not impose a duty on snuff and tobacco? MR. S. SMITH considered the observations of the member who had just sat down as amusing and ingenious, but they were not satisfactory. To him it seemed a very odd scheme to crush American manufactures in the bud. Men of capital and enterprise advanced large sums of money in erecting snuff mills. After long exertions they began to reap the reward of their expenses and their labor. At that critical moment the Government souses down upon them with an excise, which ends not in revenue, but extirpation. MR. NICHOLAS.-We are going on exactly in the steps of Britain, of which this excise is one instance. That country once had a revolutionary spirit. How sunk are they now? Not one-tenth part of them dare to say that they are against the war with France, which is sweeping them with velocity over the precipice of ruin. What has degraded and annihilated the spirit of Britain? Public debts, taxes, and officers of |