Report of the Secretary of the Treasury. January 10, 1863:
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Source Description:
(caption title) Report of the Secretary of the Treasury.
C. G. Memminger
78 p.
Richmond
Treasury Department, C. S. A.
1863.
Call number 1182 Conf. (Rare Book Collection, University of North Carolina at Chapel Hill)
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Library of Congress Subject Headings, 21st edition, 1998
Languages Used:
- English
LC Subject Headings:
- Finance -- Confederate States of America.
- Finance, Public -- Confederate States of America.
- Debts, Public -- Confederate States of America.
- Taxation -- Confederate States of America.
- Confederate States of America -- Appropriations and expenditures.
- Confederate States of America -- Economic conditions.
- United States -- History -- Civil War, 1861-1865 -- Economic aspects.
- United States -- History -- Civil War, 1861-1865 -- Finance.
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REPORT
OF THE
SECRETARY OF THE TREASURY.
TREASURY DEPARTMENT, C. S. A.,
RICHMOND, January 10, 1863.
Hon. T. S. BOCOCK,
Speaker House of Representatives, C. S. A.:
SIR: I have the honor to submit the following report of the condition of this Department:
The statements for the last year were made up to the 18th February, 1862, the termination of the Provisional Government. From the commencement of the Permanent Government to the 31st December, 1862, the receipts and expenditures were as follows:
| Patent fund, | $13,920 00 |
| Customs, | 668,566 00 |
| Miscellaneous, | 2,291,812 00 |
| Re-payment of Disbursing officers, | 3,839,268 00 |
| Interest on loans, | 26,583 00 |
| Call loan certificates, | 59,742,796 00 |
| One hundred million loan, | 41,398,286 00 |
| Treasury notes, | 215,554,885 00 |
| Interest bearing notes, | 113,740,000 00 |
| War tax, | 16,664,513 00 |
| Loan 28th February, 1861, | 1,375,276 00 |
| Coin received from Bank of Louisiana, | 2,539,799 00 |
| $457,855,704 00 |
| War Department, | $341,011,754 00 |
| Navy Department, | 20,559,283 00 |
| Civil, miscellaneous, foreign intercourse and customs, | 13,673,376 00 |
Page 2
| Interest on public debt, (loans), | $5,892,989 | ||
| Payment of treasury notes, act 9th March, 1861-- | |||
| Principal, | $545,900 | ||
| Interest, | 20,860 | ||
| 566,761 | |||
| Redemption of 6 per cent. certificates, | 11,516,400 | ||
| Redemption of treasury notes called in for cancellation and re-imbursement of principal, under act of May 16, 1861, | 23,751,172 | 41,727,322 00 | |
| $416,971,735 00 | |||
| Add balance against the Treasury on 18th February, 1862, | 26,439,572 00 | ||
| $443,411,307 00 | |||
| Amount of receipts, | $457,855,704 00 | ||
| Deduct amount of expenditures, | 443,411,397 00 | ||
| Balance, | $14,444,397 00 |
This balance consists in part of the coin on hand, received from Bank of Louisiana, and the remainder in interest-bearing treasury notes.
The appropriations made by Congress and not yet drawn from the treasury are as follows:
| Civil and miscellaneous, | $10,925,049 00 |
| War Department, | 57,865,879 00 |
| Customs, | 396,612 00 |
| Navy Department, | 12,692,373 00 |
| Amount, | $81,879,913 00 |
The estimates for the support of the Government to first July, the end of the fiscal year, are as follows:
| Legislative, | $231,600 00 |
| Executive (salary of President, &c.,) | 13,471 00 |
| Treasury Department, | 29,929,697 00 |
| War " | 242,977,067 00 |
| Navy " | 16,948,870 00 |
| State " | 150,253 00 |
| Department of Justice, | 172,632 00 |
| Postoffice Department, | 60,123 00 |
| Miscellaneous, | 10,000 00 |
| $290,493,713 00 |
Page 3
In order to ascertain the amount to be raised by Congress, we must add:
| 1. The estimates, | $290,493,713 | |
| 2. Undrawn appropriations, | 81,879,913 | |
| $372,373,626 00 | ||
| And deduct the balance in the treasury of, | 14,444,397 00 | |
| Leaving amount to be raised, | $357,929,229 00 |
The debt of the Government at the same date was as follows:
| Under act of February 28, 1861, | $14,987,000 | ||
| "" May 16," | 6,414,300 | ||
| "" August 19, " | 67,585,100 | ||
| Deposite certificates under act of Dec. 24, 1861-- | |||
| Issued, | $69,005,370 | ||
| Redeemed, | 12,516,400 | ||
| 56,488, 970 | |||
| $145,475,370 00 |
| 3.65 notes, | $992,000 | ||
| 2 years, notes, | 10,919,025 | ||
| General currency, | 272,022,467 | ||
| 7.30 notes, | 120,480,000 | ||
| $1 and $2 notes, | 6,216,200 | 410,629,692 00 | |
| $556,105,062 00 |
In the above statement is contained a large amount of bonds and interest-bearing notes, which are on hand in the various depositories not yet issued. It is important to bear this in mind in estimating the effect of the act of the last session upon funding treasury notes. The loans in which such notes are funded, are those mentioned in the schedule as loans of May 16th and August 19th. The amount of those loans as reported at the last meeting of Congress was on 1st August $41,577,250.
| By the statement now reported, the total amount of these bonds is, | $73,999,400 00 |
| From which should be deducted amount on hand not yet disposed of, say | 8,000,000 00 |
| $65,999,400 00 | |
| And in order to ascertain the amount of treasury notes funded, there must be deducted for the bonds issued for produce, say | 7,000,000 00 |
| $58,999,400 00 | |
| Deduct amount reported 1st August, | 41,577,250 00 |
| Balance, | $17,422,150 00 |
Page 4
This balance shows the amount of treasury notes funded in five months, the average being about 3 1-2 millions per month.
| During the same period the interest-bearing treasury notes have increased from | $22,799,900 00 |
| To | 120,480,000 00 |
| Increase, | $97,680,100 00 |
| From which deduct notes on hand, | 11,004,609 00 |
| Real increase, | $85,775,500 00 |
This large increase of interest-bearing notes affords satisfactory evidence that the issue of them was a judicious measure; and for any ordinary war, the bonds and interest notes amounting together to a monthly sale of twenty and a half millions would have sustained the Government without any resort to paper currency. But the estimates call for more than twice the amounts furnished by these resources; and we are compelled to resort to the Treasury Notes to supply the deficiency. It becomes, then, a most important enquiry whether the issue of such notes can be continued, and, if it can, then to what extent?
In a former report it was shown that the circulation of the Confederate States before the war might be estimated at one hundred millions of dollars. In the existing state of things, it is probable that a larger amount of currency is required. In time of peace, money passes rapidly from hand to hand, and the same money, in a single day, will discharge many obligations. A large portion, too, of the operations of business are performed by bills of exchange and bank checks. In the present stagnation of commerce and intercourse, larger amounts of ready money are kept on hand by each individual, and the Confederate treasury notes and call certificates are used as a substitutes for bills and drafts to a considerable extent. If this view be just, we may venture to add as much as fifty per cent. to the usual amount of currency, and this would raise the sum total at which it might stand, to one hundred and fifty millions. The difference between this sum and the actual circulation will show the redundancy. The actual circulation embraces not only treasury notes but bank notes and State emissions of treasury notes. In ordinary times coin would also form a part; but, at present, not only the coin but a large portion of the bank notes have been withdrawn from circulation.
The issue of treasury notes on the last day of December amounted to $290,149,692, exclusive of interest bearing notes. By adding to this sum a sufficient amount to cover the State treasury notes and the bank notes in circulation, we can arrive at the sum total of the currency. Twenty millions added to the treasury notes would probably represent the whole.
It is this aggregate which must be kept in view when we deal with the currency as a measure of values. It is the whole mass as it is accepted by the community in exchange for its various commodities, determines
Page 5
their prices. By a law as invariable as any law of physical nature, these prices rise or fall with the actual volume of the whole currency. Neither skill nor power can vary the result. It is, in fact, a relation subsisting between two numbers, the one representing the total values of property, and the other the total circulating medium. The nature of that medium cannot change it. It would exist with a currency of gold with as much certainty as with one of paper, if the gold were kept within the country by restraints equal to those which retain the paper.
Assuming, then, that entire confidence exists in our currency, the mere fact that its actual volume has been increased threefold would lead us to expect a corresponding increase in prices. Such increase, although eventually certain, does not usually appear at the same moment with the expansion. Like the moon's attraction upon the ocean, the time of high water is postponed for a certain period beyond the moment at which the influence has been exerted, and the length of the interval is affected by exceptional causes. But although there may be delay, the event is certain. Prices will reach the height adjusted by the scale of issues, and they can only be restored to their usual condition by a return to the normal standard of currency. In other words, the only remedy for an inflated currency is a reduction of the circulating medium. Is this reduction practicable?
Before answering this question it is important that we should be fully assured of the excessive issue of paper currency. If the country were open to foreign intercourse, the difference in value between coin and paper money would at once afford a test. But in the present condition of trade, coin cannot be imported, and gold and silver have become articles of commerce like iron and lead. They cannot, therefore, take their usual place as absolute measures of value.
Difficulties, somewhat of the same kind, attend other tests, such as bills of exchange, real estate or commodities in general use, and of which there is no scarcity. Ordinarily, the average price of wheat, grain and other like articles of prime necessity would furnish a guide. But the want of transportation causes a fluctuation of demand and supply from day to day and thus deranges prices. Making all due allowances for fluctuation we find that the present prices of such articles range at nearly three times the usual peace prices. Notwithstanding the interruption of commerce, we find also, that the foreign exchanges, and even coin stand at nearly the same rate. Reasons of a different character, but of equal force, apply to real estate and prevent its price from being a proper guide. The general increase, however, in its nominal value confirms the conclusions deduced from the other tests. These facts unite in establishing beyond doubt, both the actual redundancy of the currency and its probable rate of excess.
The remedy which is required, in order to be effective, must, therefore, withdraw two-thirds of the entire volume of the currency.
The measures already adopted by Congress were intended to act in this direction. The treasury notes were all made fundable originally in eight per cent. securities, and it was supposed that the holders of notes would prefer investing them in bonds, rather than hold them
Page 6
when depreciated. To stimulate investments the holders have been notified by the act of last session, that, after the 22d April, they can no longer invest in eight per cent. securities. These measures, although judicious and well-timed, are overpowered by the necessity which compels the Government to increase its issues. Notwithstanding the large and daily investments in bonds, the currency continues rapidly to grow in quantity. This increase causes a daily advance in prices, and the necessities of the Government compel it to purchase at these prices. The payment of enhanced prices again compels a further increase in the issues, and an ascending series of action and re-action is thus established between prices and issues, which, if not arrested, must result in consequences disastrous to the best interests of the country.
These effects are hastened by the injurious operation of the excess of currency upon the bonds of the Government. These bonds are offered as absorbents for the treasury notes, and the high rate of interest which they bear is the inducement to take them. In our present circumstances this interest must be paid in treasury notes. By depreciating these notes the interest suffers equal depreciation; and an eight per cent. bond becomes, in effect, a four or three per cent., according to the scale of issues of treasury notes. The inducements to take the bonds is thus destroyed, and the bonds themselves cease to afford relief to the currency. They offer still less inducement to any foreign purchaser, because he is informed by the rate of exchange, that his interest will be paid in a currency which must be exchanged for his own at the rate of three dollars for one. It is plain, therefore, that the change required is a prompt reduction of the currency to its normal condition. The question recurs, is this practicable?
At the last session of Congress an effort was made to attain this result by the proposal for a loan of one-fifth of all gross income, to be paid in treasury notes in exchange for bonds. The adoption of this measure would have retired a large amount of treasury notes at an early period, and would thus have checked the advance of prices. It is the misfortune of every such failure that it leaves the evils increasing at a double ratio; and subsequent remedies must be so much the more stringent. All the causes of excess continue in full operation. Prices increase; the Government is compelled to purchase, and the purchases must be paid by new issues. Each new operation aggravates the disease, and hesitation or delay is ruinous.
The conditions then which any sufficient remedy must fulfil, are first, prompt, and secondly, effective reduction. To be effective, the currency must be reduced at least to the one hundred and fifty millions already shown to be its extreme limit; and this reduction must be so prompt as to take effect before prices can undergo further increase.
To meet these conditions, I would respectfully propose that after the lapse of a reasonable time, the issues of treasury notes bearing date prior to the 1st December, 1862, shall cease to be currency. This can be done with the least possible injury by following up the action of Congress at the last session, and fixing a period of limitation for funding these notes.
Page 7
As the law now stands, these notes are receivable for government dues; and the holder is entitled to fund them in eight per cent. securities, until the 22d April next, after which date he can fund in seven per cent. I propose simply to fix a period of limitation for the exercise of this last mentioned privilege; by enacting, that after 1st July next, the privilege of funding these notes, shall cease. Six months have already been allowed for investment in eight per cent. securities, according to the contract on the face of the note. Two months more will be allowed for investment in seven per cent. and if, after so long a notice, the holders do not choose to avail themselves of their privilege, the good faith of the Government will stand clear of imputation.
But it is essential to good faith that ample means should be provided by the Government, to secure and pay the principal and interest of the securities in which the holders are required to invest. This can only be effected by an ample and permanent tax. Such a tax is the corner stone of the whole fabric. Without it, the scheme has no foundation, and can secure neither public confidence nor success. The proper extent of this tax will, hereafter, be considered. It is sufficient for the present to affirm that it must, at least, pay the interest on the entire public debt.
To give completeness to the plan, it would seem proper to provide measures for any future redundancy. We are happily relieved from this necessity by the patriotic proposal of several of the States to guaranty the whole, or a large portion of the war debt of this Government. If all the States can be induced, promptly to adopt this measure, means will thereby be furnished to absorb any excess of the new issues over the proper amount of currency. The guaranty of the States will enable this Government to reduce the interest of its bonds to six per cent., and if the States can be prevailed upon to extend the guaranty so as to cover the whole war debt, or at least four or five hundred millions thereof, the saving in interest will be so great as to enable the Government, in due time, to extinguish the whole principal of its debt. Upon a debt of 500 millions, this saving will be just ten millions. The ability to apply this amount to the principal instead of the interest, affords such obvious advantages, as to ensure the favorable consideration both of Congress and of the States.
An analysis of the scheme proposed, will reduce it to three essential features:
1. A limitation upon the privilege of funding the notes issued, prior to 1st December.
2. A war tax.
3. A guaranty by the States.
I. In considering the first of these features, the first enquiry which suggests itself is, what will be the effect of this limitation? Will it arrest the circulation of the notes and lessen the volume of currency?
Its first effect will certainly be to add another stimulant to investment in bonds. It was unfortunate that the act of the last session postponed the change of interest for six months. The delay has deprived the remedy of much of its efficacy, and good faith requires
Page 8
that at least sixty days should be allowed for its operation. Otherwise, I would have proposed to limit the funding privilege to 1st May, instead of 1st July. The effect of the stimulant is thus retarded. Still the fact that there is a period of limitation, will induce holders to come in before it expires. Those who desire to secure eight per cent securities, will come in before the 22d April, or hold up until near that day, the notes which secure that right, and all who can, will come in before the 1st July, to save the final exclusion. It is probable, therefore, that throughout the entire period an amount will be withdrawn, sufficient to check any rapid advance in the total amount of circulation.
But when the final date of limitation approaches, the notes will not pass readily from hand to hand; and the result will be that they are thrown out of ordinary circulation and relieve the currency to that extent. The comparatively small amount then left in the hands of individuals, will cease to have a purchasing power. They will pass only by special contract, and their chief value will consist in their being receivable for government dues. If at this point the Government will collect a tax sufficient to absorb the whole remnant, the relief afforded to the community and the currency will be made complete.
Hitherto the policy of the Government has sought to absorb the circulation by inducements alone. Bonds at a high rate of interest have been offered; but the inducement has been abated by the depreciation of the currency in which the interest is paid. It is proposed now to supply the deficiency by small portion of constraint. We see on every side of us indications of the abundance of money. Large sums are everywhere held on deposite; but the holders propose for themselves more profitable investments than public securities. The ability to keep unemployed these sums, and to hold them for an indefinite time, proves that no serious damage will be suffered by requiring their conversion into bonds. The large amount of money, which is shown by the war tax returns, to be invested at interest in private hands, confirms the belief that there is no want of capital among our people. It does not seem to be a rash conclusion, therefore, that at least three-fourths of the currency out-standing on 1st December, may be funded without substantial damage to private interests. If the remaining fourth could be absorbed by a tax, the solution of the problem would then be complete. The people are fully prepared for the payment of a high tax. It may not be practicable to place it at so high a rate as to absorb one-fourth of the entire currency to be called in, but it may approach so nearly as to leave unabsorbed only that portion which will remain out-standing, in spite of all efforts to call it in.
I will not venture to assert that grave objections may not be made to this scheme. Such objections will be found in the way of every plan. They are necessary results of the proportions of the war which is waged against us, and of the enormous sums of money required to carry it on. But it appears to me that upon due examination, these objections, if not entirely obviated, will be found to be counterbalanced by equivalent advantages.
Page 9
The first and most obvious objection to the scheme, is that it is an infringement of the contract. The notes have been accepted upon the promise of the Government that they may be invested in interest-bearing public securities, and that promise is not fulfilled after the 1st July next.
It might be answered that Congress has already settled this principle by the act of last session, which reduced the interest from eight to seven per cent. A still better answer will be found in the reasons which led to that act, and which make necessary the one now proposed. A limitation of time for the performance of contracts, has never been considered an infringement where sufficient opportunity is given to claim performance. Justice is satisfied by giving to the party full opportunity to receive the benefit of his contract. Upon this principle rests every change in statutes of limitation. Examples of the same principle are afforded in private matters, by the laws of partnership and for the administration of assetts. In public matters, the history of every nation affords like precedents, which will probably find support in the laws of every State in our Confederacy.
The modification of the contract is substantially for the benefit of both parties. The object in view is to increase the value of the whole remaining currency. This object it effects by increasing the purchasing power of each note, in proportion to the reduction of the whole. Assuming this reduction to be two-thirds, it follows that every holder of only one-third, in proportion of the new issues will have the same value in money left, after he shall have invested the other two-thirds in bonds. In other words, he will make a clear gain of those two-thirds. If he shall have in his possession none of the new issues, he will, nevertheless, gain in the reduced price of every article of consumption.
2. Next it will objected, that after the lapse of the period of limitation, the value of the note as money is taken away. It is true that the note will lose its function as money; but its intrinsic value is unimpaired. It is still receivable for public dues, and it still has the faith and property of the Confederate States pledged for its payment. It will even have a modified circulation. A great public exigency has arisen which compels a change, and all that the Government can do is to make the change with as little injury to private rights as possible. This it endeavors to do by avoiding any direct interference with the contract, and by giving to the holder ample opportunity to reap all its advantages. The time for the enjoyment of these advantages was no part of the contract, and every holder was bound to know that such an incident has always been considered within the control of the law-making power.
3. It will be urged that the calling in the circulation as proposed will cause too large and sudden a contraction. An examination of the probable state of the currency at the date of limitation will show this objection to be unsound. The new circulation to be issued after the first December, will on first July probably be upwards of two hundred millions. It will be issued gradually, and will fill up the channels left by the funding of the old issues, and so far from producing contraction,
Page 10
the new issues will probably be in excess at too early a date. The danger at all times to this kind of currency is in that direction.
4. A fourth objection will be found in the probable effect on the price of bonds. The large amount of currency turned into bonds will cause the supply to outrun the demand, and the usual consequences of such a condition of the market will follow. It cannot be denied that the price of bonds will probably fall. But this fall will in truth be merely nominal, and will find a full compensation in the increased value of the currency for which they are sold, and in which the interest will be paid. Those classes of the community which sell bonds from necessity or for the means of living, will probably gain more in the reduced market prices of the articles which they purchase than they will lose in the reduced interest value of the bonds which they sell. Those who hold the bonds on speculation, would gain or lose according to their ability to hold them; while all those who have taken them as investment will escape injury by simply holding them according to their original purpose. The contraction of the currency will increase the value of the interest paid there during the war; and at the end of it, they will have a security which will command a price which will amply repay their confidence.
The most conclusive answer, however, to this objection is to be found in the fact that whatever may be the amount of depreciation on the bonds, it cannot exceed the depreciation in the value of the currency. If the Government must issue an obligation in the shape of currency to pay twenty-one dollars for a barrel of flour, which in a normal condition of the currency could be purchased with seven, it is actually selling its paper at one third of its face. At the same time, by excessive issues, it is disturbing all other values, and all the commercial relations of society. The depreciation in the bonds could never reach this high rate; neither would it affect the prices of commodities or commercial relations. If then we are reduced to a choice between evils, the reduced value in the bonds is manifestly the less.
II. We come now to the consideration of the next great feature in the scheme, namely: the war tax. What shall be the subjects of that tax, and what amount should it raise?
The subjects upon which a tax may be levied are many, and the expediency of each involves questions which it is not proposed at present to discuss. It seems to me that a tax upon property and income is so much to be preferred to stamp duties, excises, licenses, and other like taxes which call for a machinery vexatious in its character and expensive in its operation, that there will be little hesitation on the part of Congress in its acceptance. The direct tax heretofore levied has set in operation all the machinery necessary to levy another; and an income tax could be collected by the same means. It seems to me that both these forms of tax should be adopted. To lay a sufficient tax upon property alone would require too large an increase in the rate of last year. Such an increase would operate with peculiar hardship upon property producing no income. On the other hand, a tax upon income is so easily evaded, that of itself it would furnish an insecure resource. It is proper, however, that
Page 11
incomes should be taxed; otherwise the whole profits of speculation and trade together, with those resulting from skill and labor would escape contribution. I propose, therefore, that a tax be imposed upon property, and upon the gross amount of incomes of every kind, excepting those below some minimum to be adjusted by Congress.
The next enquiry is as to the rates of these taxes, to adjust which, it must first be ascertained what amount it is necessary to raise. It has been shown that up to the first July next, the treasury notes in circulation will exceed $500,000,000 00
| Deduct the circulation proposed to be left, say | 150,000,000 00 |
| Remaining funded, | $350,000,000 00 |
| The annual interest on this sum at 8 per cent. is | $28,000,000 00 |
| To this must be added the interest upon about 120 millions of 7.30 notes, | 8,760,000 00 |
| And upon 60 millions of 6 per cent. certificates, | 3,600,000 00 |
| Also the interest upon 8 per cent. bonds and stock, say about 100 millions, | 8,000,000 00 |
| $48,360,000 00 |
This amount shows the lowest figures which should be raised by tax. The soundest considerations of policy would add as largely to this sum as the people of our country can bear. If the tax be made payable in all kinds of treasury notes, it would absorb so much of the first issues, and by reducing the amount to be funded, would abate the force of the objections to the scheme. If sixty millions of notes could be thus called in, the benefits resulting would fully counterbalance every possible hardship. The currency would promptly recover its value, the bonds would become an object of investment instead of being thrown on the market, and a sure and steady system of finance would be established.
A tax of one per cent. on property if it could be made as productive as last year's, would raise twice the amount of the last war tax, say forty millions. But inasmuch as portions of the States are in the hands of the enemy, it would be proper to make a deduction of probably one-tenth, which would leave the amount at only thirty-six millions.
This sum would be subject to still further abatement, so long as the decision of the Confederate Court of South Carolina as to the power of Congress to tax State bonds remains unreversed[.] The very large amount of money invested in this form was included in the war tax act of the last year, and the tax thereon was paid everywhere, except by those who raised the question in South Carolina. For the ensuing year the case would be different. If the same tax were laid by Congress, it is probable that the holders of State bonds would claim exemption under this decision, and Congress itself might be unwilling to re-enact in the same form, a law which had been declared unconstitutional by the co-ordinate branch of the Government, until that
Page 12
decision is reversed. The question is of such magnitude and involves such great interests that an appeal was taken. But this appeal cannot be decided until a Supreme Court shall be organized. It may be worthy, therefore, of the consideration of Congress, whether the question should not be raised in another form, by taxing the income of the bonds in the hands of the citizens. The taxing power over income in the hands of the citizen for consumption may be distinguished from that over State bonds, specifically as property. In my view, both are constitutional, and the public interests demand that every proper effort should be made to ensure consideration of the question in all its aspects. In either case, however, the tax would probably prove unproductive, until the question shall be finally decided. It is necessary, therefore, to estimate for an abatement on the tax of last year. Assuming one hundred millions as the probable amount invested in State securities, a tax of one per cent. would amount to one million of dollars, and so much must, therefore, be abated from the estimate.
In estimating the rate of a tax on incomes, the only basis to which I can refer, is the value of the entire property in the eleven Confederate States. It may be assumed that the nett income of this property is measured by the average rate of legal interest of the money which represents its value. If the tax were laid upon nett income, and that income were faithfully returned, it could, in this way, be estimated with some degree or accuracy. But the devices are so many by which a return of nett income can be evaded as to make such returns unreliable. A resort to gross income is therefore more expedient. The difference between the two must be at least 25 per cent., but, under existing circumstances, and for the purpose of an estimate it would be prudent to disregard the difference and assume that the returns of gross income will be about equal to the average rate of legal interest. It is believed that even the proceeds of skill, speculation and labor which may be returned where no capital is involved will not materially vary the result.
The estimate formerly made to Congress of the value of all the property in the eleven Confederate States, in which taxes have been collected, was 4,632 millions. If we leave out the odd numbers in these figures, on account of such property as is now beyond the reach of taxation, and for other contingencies, we have in round numbers, 4,000 millions. The average of interest in the Confederate States may be set down at 7 per cent., which would make the total income equal, to say 280 millions. A tax of 10 per cent. on this sum would produce, in the gross, about 28 millions. And this added to the property tax of 35 millions, would raise a sum total of 63 millions of dollars, or in round numbers, sixty millions after deducting expenses and contingencies.
It will probably be insisted that there is no occasion for the imposition of so heavy a tax; and many will contend that it is sufficient that the Government pay the interest alone of the public debt. I ask leave most earnestly, to dissent from this doctrine, and to urge upon Congress a continuance of the policy already adopted by this Government
Page 13
of making portions of the public debt payable every six months after the probable termination of the war. The sinking funds devised by Mr. Pitt, and the great statesmen of his times, have proved deficient, not in principle, but in administration. The principle upon which they rest is the annual raising of an amount beyond the interest for the purpose of eventually discharging the principal. The punctual investment of those surplus sums at compound interest by the mere operation of numbers, would be certain to discharge the debt in a given time. The failure of this plan, in its effects upon the public debt of England, arose from defects in its administration. As the invested fund increased in amount, it offered constant temptation to the Government to make use of it, and the party in power often preferred inventing pretexts to seize upon it, or to court public favor by calling off unpopular taxes required for its increase rather than continue or augment those taxes. Besides, the neglect to make punctual investments as the interest accrued had a constant tendency to reduce compound interest to simple; and thus it was found impossible, in a long course of years, to preserve the fund inviolate, or to maintain the constant supply from taxes, which the plan demanded.
These defects are believed to be remedied by the plan upon which the one hundred million loan of this Government has been issued. It resembles the sinking fund plan in requiring an annual surplus of taxes beyond the amount of interest on the public debt. But it differs from it, in applying this surplus to the immediate reduction of principal. The machinery of a fund is dispensed with, together with all its attendant officials. The best practical investment is made by paying off so much of the public debt; and the temptations and waste incident to a fund, are avoided. The full benefit of a sinking fund is thus secured without its disadvantages. All that is required is the original adjustment of the payments of principal through an entire series of years, and the steady determination of Congress to raise annually a fixed sum sufficient to make these payments in addition to the yearly interest. The number of years in which the debt will be paid, will depend upon the amount of this fixed sum. In proportion to its excess over the annual interest, will be the shortness of the period. The first payments of principal will be comparatively small. But each will diminish the interest of the succeeding year, and will thereby set free a larger sum annually to be applied to pay the remaining principal, until the debt be finally discharged.
The act of Congress of 12th April, 1862, departed from this plan, and made the next issue of bonds payable in 30 years subject to redemption at any time after the expiration of ten years. The whole subject necessarily comes up for consideration in adjusting the tax now to be laid by Congress.
The 15 million loan carries an interest of 8 per cent; it is payable in ten years, but may be redeemed at any time after the 1st September, 1866. The one hundred million loan is also an 8 per cent. loan, and is made payable in instalments which fall due every six months for 18 years, from 1st January, 1864. The first instalment of principal of $1,288,700 is payable 1st January, 1864; the second of
Page 14
$1,340,200 is payable 1st July, 1864. The third loan is under the act of April, 1862; it is also an 8 per cent., payable as above stated, at the pleasure of the Government at from 10 to 30 years.
If Congress should approve the application of the plan of the one hundred million loan to the whole debt of the Government, then a change should be made in the loan of April, 1862. No bonds have yet been issued under that act, and the matter is yet within the control of Congress. A modification of the law must be made at any rate to meet the reduction of interest required on notes issued subsequent to 1st December. If the scheme of finance hereinafter proposed, in rotation to the debt guaranteed by the States shall find favor with Congress, a further modification of the loan of 12th April, 1862, should be made by reducing the period for redemption from ten years to five. This change will enable the proceeds of the sale of the six per cent. bonds guaranteed by the States, to be applied in discharge of the 8 per cent. at the end of five years in case they cannot be purchased in the market sooner.
III. We come now to the third feature in the scheme, namely, the guaranty of the States.
The State of Virginia led the way and proposed that Congress should devise a plan for a loan to be guarantied by the States. Congress did not see fit to take any action on the subject at its last session. It was probably deemed best that the proposal should come from the States. An offer of their guaranty is certainly more beneficial to the credit of the Government than a request for aid. The delay has given the opportunity to the States to make the offer. The State of Alabama has offered a guaranty of her quota of the whole war debt upon certain conditions. The State of South Carolina has offered to guaranty a quota of two hundred millions upon certain other conditions. A copy of the action of their respective Legislatures is herewith submitted.
The varying action of these two States evinces the importance of settling a definitive plan by Congress. It is probable that every State will cordially respond to such plan and sustain the credit of this Government.
The great advantages to be derived from this guaranty have already been somewhat developed. It is only necessary now to give prominence to two of them: First, the opportunity which it affords of converting an eight per cent. into a six per cent. debt; and, secondly the premium which can be realized on the sale of the bonds. The former will enable the Government to establish a loan on the principle already explained, and the latter will place in its hands ample means to call in the redundancy of treasury notes after the 1st July next, and to sustain the credit of its eight per cent. securities or to purchase them.
Assuming that the States may be induced to extend their guaranty to five hundred millions, I propose to adjust the debt upon the plan of the hundred million loan so as to ensure its discharge within a given period: The length of this period depends upon the sum which Congress will devote to the annual payments. The commencement of
Page 15
the period or the date at which the first payment is to be made is, of course, within the control of Congress, and involves the same inquiry as to the amount now to be raised by taxes. A postponement of this first payment of principal would seem to allow a diminution of the tax. But it must be observed that some considerable time must elapse before the guaranty of the States can be had; and, further time must then be consumed in carrying the plan into execution and in procuring returns of the sales. During all this period the eight per cent. and 7.30 notes are outstanding, and will absorb nearly as much more money as will afterwards be required to meet the first annual payments on the principal. Besides this, it cannot be too strongly urged that the present is the appropriate moment at which to commence a proper system of taxes. The patriotism of the country is now fully aroused. The duty of contributing largely to the support of the Government is generally recognized. The large amount of money in circulation will make the payment easy, and the payment itself will aid the tax payer by reducing prices to their proper condition.
Before leaving this subject, I would respectfully submit that there is another plan for arranging the debt in instalments, which would produce the same results. It is by issuing all the bonds in the usual form payable at the same date, and attaching to them a condition that the Secretary of the Treasury shall annually or semi-annually, by lot, designate a certain portion to be paid off. If these annual payments were arranged on the same principle which governs the one hundred million loan, and were made equally obligatory upon the Government, the result would be the same.
A reference to a few details will conclude all I have to say on this subject:
With my last report was submitted a report from the war tax office, to which I request your attention, particularly to the observations in relation to a uniform tax on slaves. It is proper, also, to make provision for a more equal assessment of property in each State. A commission of a certain number of the tax collectors from the various portions of each State should be appointed to meet and adjust the rate at which the various kinds of property should be assessed.
It seems to me, also, that the entire machinery of assessors provided by the last act can be dispensed with by charging the duties of the assessors on the district collectors, and increasing their salaries. Exceptions may be made in case of large cities. This defect in salaries attaches to the entire arrangement of the last act. It is not a wise policy to confide large money arrangements to officers who are badly paid. The patriotism of the officers induced them, during the last year, to accept the offices with the small salaries allowed. But it would be neither wise nor just to ask a repetition of the sacrifice.
The issuing of treasury notes and the transfer of them to the various depositaries, with the arrangements at those depositories for their receipt, custody and disposal, have grown into some of the most important functions of this Department. The engraving, printing and preparing the notes involve great responsibilities and still greater expense, and I must again urge upon Congress the expediency of
Page 16
creating for this branch a separate bureau. The necessities of the times compelled a transfer of the printing establishments to Columbia. It seemed a better policy to encourage private competition and enterprise, rather than undertake to carry on mechanical work by the Government. The engraving and printing, together with the manufacture of paper have all been done by contract. But the handling of the notes after they are printed, and the trimming, numbering and signing them require a large number of clerks. I have been obliged greatly to increase the number under the authority of the act of March 7, 1861, and the whole number is now two hundred and sixty-two, of whom one hundred and thirty-nine are ladies. I ventured upon the employment of the latter, under the belief that they would be found diligent and efficient, and that Congress would approve the relief which was thereby extended to a large portion of the most loyal, suffering and deserving of our countrywomen. In arranging their duties, I reduced the time and work required below the rate required of the men, and made a proportionate reduction of salary. The plan has been found to work well. When it is considered that this very large branch of the business of the Treasury is without an appropriate head, and must be superintended in all its details as matters now stand by the Secretary himself, it will, I trust, be deemed reasonable to establish a separate bureau for its administration. I am bound by a sense of public duty again to say, that it would conduce more to the public interest to dispense with most of this agency, and have the signatures to the notes engraved and printed. Experience proves that any signature is readily imitated--that the signatures of the same writers vary so much as to afford no adequate guide, and, that where so many signers are employed, it is impossible to inform the community either as to their names or signatures. The written signatures, therefore, furnish no better security than the engraved.
The issue and deposite of treasury notes, and the very large disbursements now made for the war have changed the entire character of the treasuries and depositories. Those at Richmond, Charleston, Montgomery and Jackson have become large banks, and the number of clerks, and the salaries of both officers and clerks are wholly inadequate. The Assistant Treasurer at Charleston has a salary of $2,500, and the clerks at each office are limited to $1,200. The teller in a bank receives as much for his salary as is now paid to the Assistant Treasurer at Charleston. That officer has, for some time, desired to resign, and for two months I have been seeking, without success, a proper successor. I have also been unable to procure competent clerks at the salaries prescribed, and have been to obliged to add to the sum. Congress may judge of the importance of these offices when they are informed that five or six millions of dollars are frequently in their hands on deposite. These officers, moreover, are made responsible for the acts of the clerks under them, a liability which, under present circumstances, no responsible party is willing to take. Unless these difficulties are corrected, it will be difficult to retain
Page 17
the present incumbents, and almost impossible to procure proper successors.
The collection of the produce loan together with the purchase of produce under the act of April 21, 1862, has been prosecuted with vigor. The total amount of subscriptions to the loan valued in money is about twenty-five millions of dollars; of which $7,631,044, have been collected at an expense of one-third of one per cent. The purchases of cotton, thus far reported by the agents, amount to 69,507 bales, costing $4,474,400. These purchases, at the present moment, have probably reached 250,000 bales including those of which reports are on the way. In order to dispose of the cotton, two forms of certificate have been devised. By one, the specific parcel of cotton is identified and disposed of. By the other, the Government obligates itself to deliver certain quantities at certain points, at a fixed price. By the advice of our Ministers abroad, some of the latter certificates, covering about 30,000 bales of cotton, have been placed as an experiment in the foreign market; but sufficient time has not elapsed to hear from them. The details of this branch of the Department, are set forth in the report of the clerk in charge, to which your attention is invited. The important and responsible duties entrusted to this clerk, render it proper that his office should be placed on a level with other branches in the Department. I would, therefore, respectfully recommend that the office be raised to the grade of a chief clerkship.
The collated returns of the war tax have not been completely made in all the States. The report of the chief clerk in charge of this Bureau, is so full and distinct upon the several points to which attention is due, that I cannot do better than refer you to a copy thereof, which is herewith presented. The question that has arisen between the Governor of Tennessee and the Department, is a mere question of estimate, but as it involves a large sum, the secretary would respectfully ask the direction of Congress as to some proper mode of adjusting the difference. The liberal manner in which the State has acted under the circumstances, may induce Congress to adopt an estimate which the Secretary would not feel himself empowered to accept.
The suspension of the collection in several parts of other States is also submitted specifically to the attention of Congress, in order that further instructions may be given. In relation to the State of South Carolina, it should be remarked that the Governor has directed the tax to be collected by the State tax collectors, whenever practicable, and the amount to be paid over to the Confederate Government.
The legislation which will be required to carry into effect the several matters recommended in this report, is the following:
1. An act limiting the period for funding the treasury notes, bearing date prior to 1st December, 1862.
2. Authority to issue a sufficient amount of treasury notes, to pay the appropriations required for the support of the Government to 1st July next.
3. Authority to issue bonds and stock sufficient to fund the notes already issued, entitled to be funded at eight per cent.; and those hereafter to be funded at seven per cent.
Page 18
4. A call upon the States to guaranty the war debt, upon a plan to issue six per cent bonds, payable in instalments, in 25 years, upon the plan of the one hundred million loan.
5. A modification of the loan act of April 1862, by reducing the time to five years, within which the Government may redeem the bonds.
6. A war tax upon property and income.
7. The appropriation act.
8. The organization of a Bureau in charge of the issue of treasury notes.
9. Increase of the salaries of the assistant Treasurers and Depositaries and their clerks.
All of which is respectfully submitted.
C. G. MEMMINGER,
Secretary of the Treasury.
Page 19
ESTIMATES OF APPROPRIATIONS required for the support of the Government, for the period from February 1st, to June 30, 1863, inclusive, and to supply deficiencies arising prior thereto.
| For compensation and mileage of members and delegates of the House of Representatives, | $174,200 00 |
| For compensation of officers, clerks &c., of the House of Representatives, | 5,500 00 |
| For contingent expenses of the House of Representatives, | 10,000 00 |
| For compensation and mileage of members of the Senate, | 29,900 00 |
| For compensation of officers, clerks &c., of the Senate, | 6,000 00 |
| For contingent expenses of the Senate, | 6,000 00 |
| For compensation of the President of the Confederate States, | 6,250 00 |
| For compensation of the Vice President of the Confederate States, | 1,500 00 |
| For compensation of the Private Secretary and Messenger of the President, | 1,007 13 |
| For compensation of the Private Secretary of the Vice President, | 714 40 |
| For contingent and telegraphic expenses of the executive office, | 4,000 00 |
| For compensation of the Secretary of the Treasury, assistant Secretary, Comptroller, Auditors, Treasurer, and Register, and Clerks and Messengers in said Department, | 357,897 10 |
| For incidental and contingent expenses of the Treasury Department, | 21,800 00 |
| For interest on the public debt, | 20,000,000 00 |
| For engraving and printing treasury notes, bonds and certificates of stock, and for paper for the same, | 350,000 00 |
| For the transfer of funds to foreign parts, | 5,000,000 00 |
| For the purchase of coin, | 4,000,000 00 |
| For the transmission of Confederte States funds, | 200,000 00, |
| Amount carried forward, | $30,174,768 63 |
Page 20
| Amount brought forward, | $30,174,768 63 |
| For compensation of the Secretary of War, assistant Secretary, Chief of Bureau, Clerks, Messengers &c., &c., in said Department, | 118,638 23 |
| For incidental and contingent expenses of War Department, | 54,000 00 |
| For the pay of the army, | 119,270,771 00 |
| For the transportation of troops and their baggage, of quartermaster's stores, subsistence, ordnance and ordnance stores, from place of purchase to troops in the field, purchase of horses, mules, wagons and harness, purchase of lumber, nails, iron and steel for erecting store houses, quarters for troops, and other repairs, hire of teamsters, laborers &c., | 47,708,308 00 |
| For pay for horses of non-commissioned officers and privates killed in battle, under act No. 48, section 7, and for which provision is to be made, | 125,000 00 |
| For pay for property pressed into the service of the Confederate States, under appraisement, said property having been either lost or applied to the public service, | 187,500 00 |
| For the sustenance of prisoners of war, under act No. 181, section 1, and the hire of the necessary prisons, guard houses, &c., for the safe keeping of the same, or so much thereof as may be necessary, | 1,000,000 00 |
| For the bounty of $50 to each non-commissioned officer, musician and private now in the service for three years or for the war, to be paid at the expiration of the first year's service, on the basis that sixty thousand men will have to be paid, | 3,000,000 00 |
| For pay of the officers on duty in the offices of Adjutant and Inspector General's Department, the Quartermaster General's Department, medical, engineer, ordinance and subsistence Departments, | 323,350 00 |
| For pay of the provost marshals and their assistants, and other employees, | 93,000 00 |
| For the purchase of subsistence stores and commissary property, | 48,656,500 00 |
| Amount carried forward, | $250,711,835 86 |
Page 21
| Amount brought forward, | $250,711,835 86 |
| For the ordnance service in all its branches, | 12,500,000 00 |
| For the purchase of pig and rolled iron, | 3,000,000 00 |
| For the purchase and manufacture of nitre, | 400,000 00 |
| For the engineer service, | 3,000,000 00 |
| For pay of private physicians employed by contract, | 150,000 00 |
| For pay of nurses and cooks, not enlisted or volunteers, | 240,000 00 |
| For Pay of hospital stewards, | 60,000 00 |
| For pay of matrons, assistant matrons, and ward matrons, | 240,000 00 |
| For pay of ward masters, | 150,000 00 |
| For pay of hospital laundresses, | 50,000 00 |
| For medical and hospital supplies, | 2,500,000 00 |
| For the establishment and support of military hospitals, | 150,000 00 |
| For compensation of the Secretary of the Navy, Clerks and Messenger, | 16,522 30 |
| For incidental and contingent expenses of the Navy Department, | 10,000, 00 |
| For pay of the navy, | 1,399,571 25 |
| For provisions and contingencies in the Paymaster's Department, | 1,321,650 00 |
| For iron-clads and other war steamers, steam engines, and other supplies contracted for abroad, | 8,000,000 00 |
| For construction of iron-clad and other vessels in the Confederate States, | 3,000,000 00 |
| For ordnance and ordnance stores, | 1,817,500 00 |
| For purchase of nautical instruments, books and charts, | 15,000 00 |
| For equipment and repair of vessels, | 250,000 00 |
| For construction of a rope-walk and purchase of necessary machinery, | 200,000 00 |
| For fuel for steamers, navy yards and stations, | 300,000 00 |
| For contingent enumerated, | 250,000 00 |
| For surgeons' necessaries, | 100,000 00 |
| For support of the marine corps, | 268,627 00 |
| Amount carried forward, | $290,100,706 41 |
Page 22
| Amount brought forward, | $290,100,706 41 |
| For compensation of Secretary of State, Clerks, Messenger and Laborer, | 5,353 00 |
| For the purchase of diplomatic books, | 1,500 00 |
| For salaries of ministers, commissioners and secretaries, | 23,400 00 |
| For salaries of consuls and commercial agents, | 10,000 00 |
| For incidental and contingent expenses of foreign intercourse, | 10,000 00 |
| For necessities and exigencies under laws already passed, or which may be passed, or from causes which now exist or may hereafter arise, and unforeseen emergencies, subject to the requisition, and under the control of the President of the Confederate States, | 100,000 00 |
| For compensation of the Attorney General, Assistant Attorney General, Clerks and Messenger, including pay of Messenger prior to March 9th, 1861, | 6,006 85 |
| For incidental and contingent expenses of the Department of Justice, | 1,250 00 |
| For the purchase of a law library, for the use of the Department of Justice, | 3,000 00 |
| For the salaries of Superintendent of Public Printing, Clerk and Messenger, | 2,062 50 |
| For compensation of governor and commissioner of Indian affairs, secretary, judges, attorney and marshal of Arizona territory, | 4,510 00 |
| For incidental and contingent expenses of Arizona territory to be expended by the Governor, | 478 50 |
| For printing, binding and ruling for the several Executive Departments, | 75,000 00 |
| For printing and binding for both Houses of Congress, including the printing of the laws and journals in book form, | 25,000 00 |
| For purchase of paper for the Executive Departments and Congress, | 25,000 00 |
| For salaries of judges, attorneys and marshals, and incidental and contingent expenses of courts, | 25,000 00 |
| For compensation of three commissioners, appointed under the sequestration act, and for clerk hire and contingent expenses, | 5,325 00 |
| Amount carried forward, | $290,423,592 24 |
Page 23
| Amount brought forward, | $290,423,592 26 |
| For compensation of the Postmaster General, Chiefs of Bureau, Clerks, Messengers, Watchmen and Laborers, | 55,123 58 |
| For incidental and contingent expenses of the Postoffice Department, | 5,000 00 |
| For rent of Executive buildings and President's house, | 10,000 00 |
| Total, | $290,493,715 84 |
| Legislative, | $231,600 00 |
| Executive, (salary of President, &c.,) | 13,471 53 |
| Treasury Department, | 29,929,697 10 |
| War " | 242,979,067 23 |
| Navy " | 16,948,870 55 |
| State " | 150,253 00 |
| Department of Justice, | 172,632 85 |
| *Postoffice Department, | 60,123 58 |
| Miscellaneous, | 10,000 00 |
| Total, | $290,493,715 84 |
*Estimates for the postal service not yet in.
| To meet the increase allowed to the employees of the Navy Department, per act October 13, 1862. | $973 15 |
| To same to employees in the Postoffice Department, | 7,715 24 |
| To same to employees in the War Department, | 21,888 23 |
| To pay of Messenger in the Attorney General's office, prior to March 9, 1861, | 6 85 |
| To compensation to Private Secretary to the Vice President from October 13, 1862 to January 31, 1863, per act approved October 13, 1862, | 303 51 |
| To compensation of Messenger to the President from October 13, 1862 to January 31, 1863, per act approved October 13, 1862, | 75 88 |
| $30,962 86 |
ROBERT TYLER,
Register of the Treasury.
Page 24
TREASURY DEPARTMENT,
War Tax Bureau,Jan. 6th, 1863
.
Hon. C. G. MEMMINGER,
Secretary of the Treasury:
In obedience to your directions, I have the honor to submit the following report in reference to the operations and results of the war tax. There are thirteen Confederate States subject to the tax, but all proceedings in relation to its collection in the States of Kentucky and Missouri, for obvious reasons, were suspended by you, and the suspension was afterwards confirmed by act of Congress, approved April 19, 1862, and consequently, no collections have been made in either of those States. Out of the eleven remaining States, the Legislatures of all except Mississippi and Texas, have assumed the tax.
Owing to circumstances growing out of a state of war, and the invasion and occupancy of various portions of the Confederate States by the public enemy, the operations under the act of 19th August, 1861, have been very much retarded, and in some particular sections it has been entirely impracticable to effect the necessary organization of officers to assess property. For these reasons, it is impossible to make a full and satisfactory report of the true results of the present system, or to exhibit the aggregate amount and value of property in the eleven Confederate States and the tax derivable therefrom, I propose, however, to give as accurate a report of the operations under the law in each State, as the materials at hand will admit, to which will be appended various tables showing the aggregate amount of each species of property taxed in each of the States, the value of that property and the amount of taxes assessed thereon. Also the amounts paid by or collected in each State, with a column showing the balance due or amount overpaid. The States will be noticed in alphabetical order, and as they appear in the annexed table "A."
1. Alabama.--For this State a chief collector was duly appointed and commissioned, but before he had completed the organization of subofficers, and had made the necessary distribution of forms and instructions, Huntsville, the place of his residence, was captured by the enemy, and the chief collector, as he represents, very narrowly escaped himself, leaving his family and all his papers and official documents within the lines and power of the enemy. And being thus expelled from his home, and cut off from all communication with his family, or access to his office and papers, and being harrassed in body and mind, he did very little or nothing toward the further prosecution of his duties, and consequently, several officers who had been appointed, resigned or refused to qualify, others failed to act for want of forms and instructions, and the whole business fell into confusion. It was supposed that the work was regularly progressing, at the time this state of facts was brought to the knowledge of the Department, when measures were immediately adopted to effect a re-organization and set the machinery again in motion. With this view I was sent to Montgomery
Page 25
about the last of June, and after conference with the Governor of Alabama, Mr. Bradley the chief collector, was induced to resign, and Judge Martin was appointed his successor. The State Legislature had some time before that, assumed the tax and advanced as a payment $2,000,000. Many of the collector's offices had become vacant, and some had never been filled at all. There was then no provision for the compensation of collectors where the tax had been assumed by the State, and the chief collector found great difficulty in procuring the services of competent collectors, and the result was tardiness and delays which have prevented him from furnishing as yet a collated list of all the assessments in the State, whereby the true amount of tax might be ascertained. An estimate has, however, been made, liberal to the State, in deference to the opinion of Governor Shorter, by which the tax is set down at $2,000,000. Deducting ten per cent. from this amount, the nett tax will be, according to this estimate, $1,800,000. This is, however, all guess work, and I am inclined to the opinion that if the property of the State is faithfully assessed, the sum paid will not much exceed, if anything, the nett amount due. At any rate there seems to be no necessity for legislation until the full returns are received.
2. Arkansas.--This State was sub-divided into fifty-five collection districts, and of that number actual returns have been received and reported by the chief collector from forty districts, leaving fifteen not yet reported. The chief collector thinks returns will be received from a number of these, but others being occupied by the enemy, or disturbed by the operations of war, will not be reported at all. From the returns actually received, and an approximate estimate for the remaining districts, the whole tax of the State will be $725,000, and after the deducting ten per cent., the quota of the State will be $652,500. Of this amount $400,000 has been paid, leaving a balance of $252,500. The invasion of the State and interference by military operations, have prevented the chief collector from completing his collated list. I do not know that the Legislature has assumed the tax, having no official notice to that effect; but it has been virtually assumed by the Executive in the payment of the above mentioned sum. It may be proper to state that this sum was paid to General Hindman's Quartermaster. The payment was irregular, but the error has been corrected, by a requisition at your request, from the Secretary of War for the amount, upon which a draft is to be in favor of said quartermaster, and when endorsed by him, will be placed on the Treasurer's books to the credit of the State as a payment on the war tax. The arrangement has not been completed, and for this reason the credit does not appear on the Treasurer's books.
3. Florida.--In this State the operations of assessment were interrupted and in some sections, entirely thwarted by the enemy, yet the property of the State has been regularly assessed and returned, except that of the fourteenth district, composed of the counties of Duval and Clay, and of the fifteenth, embracing the county of St. John's. Owing to the continued occupation of these counties by the enemy, no returns from them are anticipated, so the full amount of the States quota, as
Page 26
taken from the chief collector's final report, is $251 233 19, and after deducting the ten per cent. the nett amount of tax is $226,109 88, of which has been paid into the treasury $225,374 11, leaving a balance of $735 77.
4. Georgia.--All the districts of this State were assessed in due time, and the chief collector's collated list has long since been received. In this list, the chief collector has not shown the number of acres of land, the number of slaves, etc., but merely shows the aggregate values of the different species of property in each district, hence I have not been able to ascertain the average values, as in other States.
The whole amount of tax assessed is $2,771,236 01. The nett tax, after deducting ten per cent. is $2,494,112 41, of which has been paid into the treasury $2,477,218 18 leaving a balance still due of $16,894 23.
5. Louisiana.--In this State the organization was pretty well completed, and assessments were progressing satisfactorily, when the fall of New Orleans threw matters into confusion, and rendered it necessary for the chief collector, who resided there, to remove with his records and papers to a safer locality, which occasioned considerable delay in the progress of the work. Nevertheless, with great energy and perseverance, Mr. Lusher, the chief collector, prosecuted his labors and finally succeeded in having all the districts assessed, but the interruptions and delays to which he has been subjected, have prevented him from forwarding a complete collated list. During the recent session of Congress, however, he presented a statement of actual returns from nearly all the districts, and for the few remaining an approximate estimate, based upon State documents, by which it was shown that the liberal advance made by Governor Moore, of $2,500,000, would probably over-pay the States quota, by $74,000, which was refunded to the State's agent, by authority of an act of Congress. The whole matter will be subject to adjustment according to the true amount found to be due when full returns of assessment are received by the department.
6. North Carolina.--Notwithstanding the invasion of large portions of this State, and the consequent destruction and deportation of property by the enemy, the organization for ascertaining the amount of taxable property, was perfected with commendable dispatch, and all the counties were duly assessed and returned at an early period[.] Before the true amount was ascertained, the State advanced $1,400 000. The whole amount of nett tax was afterwards shown to be $1,288,825 31, which was over-payed by the sum of $111,174 69, which was refunded to the State by act of Congress, as in the case of Louisiana. So this constitutes a final settlement between the State and the Confederate States.
7. South Carolina.--All the districts and parishes in this State were in like manner assessed, but several parishes contiguous to the sea and navigable waters near the coast, have been subjected to the invasion and depredations of the enemy. For this reason, Governor Pickens claimed exemption, by virtue of the act of 19th April, 1862, for the following parishes, to-wit:--All Saints, Saint George's Winyaw, Saint
Page 27
Helena, Saint John's Colleton, Saint Andrews, Saint Luke's and Saint James' Santee, and a deduction from the ascertained quota of the State, of the full amount of taxes assessed in these parishes. After a prolonged correspondence with the Governor, in which he was urged to relinquish his demand and pay up the full quota, he declined and insisted upon the exemption, and as the tax books had been turned over to the State authorities, and the Confederate collectors had been discharged, there was no other alternative left than to acquiesce in his demand, with the understanding that all moneys collected in these parishes should be paid over to the Confederate States. The whole amount of taxes assessed in the State, after deducting ten per cent, is $1,798,076 52. There has been paid by the State $1,651,525 55, leaving a balance of $146,547 97, being a sum less than the amount of assessments in the exempted parishes, after deducting ten per cent therefrom. The sum assessed on these parishes less ten per cent, is $151,995 60, the difference against the Government being $5,447 63. It is for Congress to determine the basis of final settlement between the State and the Confederate States. As appropriate to this subject, I deem it proper to call your attention to the following views of Joseph D. Pope, Esq., chief collector for that State, as expressed in a letter to your address, dated the 1st November last. He says:--"My individual judgment is that the parishes named are not in such condition as was contemplated by the exemption act of Congress, but the terms of the act are so general and broad, that they may cover anything that the President of the Confederate States may agree to. It seems to me, if I understand the act, that unless the President agrees that these parishes shall be exempted, that the State must pay. Many of the people of Saint George and All Saints can pay, and that would be a question between the State and the citizens. The object of the State in assuming the tax at all, was to enable her to extend indulgence to those of her citizens who could not pay. For such she would advance the money, and rely upon future payment from them. This is as it should be. The indulgence should come from her instead of the Confederate States." In these views I fully concur, and would further add, that in assuming the tax, the State took the jurisdiction of the whole matter of taxation out of the hands of the Government, and now exercises exclusive control over it. The whole tax assessed upon the citizens was assumed, without exception or distinction, and it is competent for Congress to remove that suspension which its own exclusive action authorized for future consideration, and to require the State to pay her full quota without abatement, as the other States have done.
8. Tennessee.--In this State a chief collector was duly appointed as in the other States, but the appointee, from severe illness, was prevented from immediately qualifying. His recovery was patiently awaited for some time, but finally, continued indisposition rendered it necessary to make a second appointment. This all produced delay, and before the second appointee could qualify and district the State, and appoint sub-officers, the same was invaded, the capital fell into the hands of the enemy, and such a state of general confusion followed
Page 28
as to render it utterly impracticable to do so, and all further efforts were abandoned. The legislature, however, passed an act authorizing the Governor to agree with the authorities of the Confederate States upon the amount to be paid by the State of Tennessee as her quota of the war tax, and another act appropriating $2,000,000 for that purpose. Every possible effort has been made through the chief collector, to obtain reliable data for estimating the amount due, and from the most reliable information as to the taxable property of the State, derived from State returns and other sources, the department estimated that the nett tax would exceed the sum appropriated, by over $200,000. The amount estimated is $2,450,000, less ten per cent, making the sum of $2,205,000 nett tax. This amount was long since proposed to the Governor. The Governor proposes a sum so much smaller than your estimate, to-wit: about $1,500,000, that it is not likely to be agreed to. It will, therefore, devolve upon Congress and the legislature of Tennessee to settle the amount to be paid, or to prescribe some mode of settlement. The Governor has paid into the treasury $1,030,069 25, and the chief collector, Dr. Ramsey, has informed you that the Governor has ordered an additional payment to be made of $400,000, making in the aggregate $1,430,069 25.
9. Virginia.--There are in this State one hundred and forty-nine counties and eleven cities, constituting as many collection districts. Ninety-seven counties and nine cities, have been assessed and returned, leaving fifty-two counties and two cities, (Alexandria and Wheeling,) which have not been assessed or returned. In the North Western counties, for apparent reasons, no attempt has been made to appoint officers or to procure assessments. In other counties in the Eastern part of the State, where the people are loyal and patriotic, collectors were appointed and had given their bonds, but before the assessors had entered upon their duties the invasion of the enemy arrested further progress. The aggregate amount of assessment returns as shown by the chief collector's final report is $548,164,215 91. The tax on this at 1-2 per cent is $2,740,821 07, and the nett tax after deducting ten per cent., is $2,466,738 97. The amount paid by the State as shown by the Treasurer's books, is $2,125,000, leaving a balance of $341,738 97. For the information of Congress, in view of any future legislation in reference to the war tax, I have deemed it proper to present herewith a series of tales prepared by Col. H. T. Garnett, the chief collector, as well as to give a condensed statement of his views and suggestions in reference to the mode of assessing a more uniform value of certain property, which I beg leave to commend as being wise and appropriate, and well worth the attentive consideration of Congress. The copies of his tables hereto annexed are numbered from 1 to 4. Col. Garnett refers to former suggestions made by him in reference to the danger of rendering the ad valorem system of taxation, unjust, unequal and oppressive, and proceeds to remark upon the impossibility, from divers causes, of approximating a fair distribution of the burdens of taxation upon the principle of rating all property of the same class, &c., at one price or value. That climate, soil and other causes, especially affecting slave property on the borders, adjacent
Page 29
to non-slaveholding territory, all operate to depress or elevate values to such a degree that it is difficult to establish a just rule in the application of one price to all the same class. But in endeavoring to avoid this by giving discretion to a great number of assessors to fix the values of the same class of property in the same region, the result sought to be avoided will not be improved by producing inequality of tax where all the elements which determine values are exactly the same. He then illustrates, by referring to the returns of assessors in coterminous counties, where climate, soil, &c., are identical, in which a marked difference in the assessment of slaves is found to exist. For instance, the county of Dinwiddie contains only 46 more slaves than the county of Essex, but the assessment upon the slaves of Dinwiddie is $521,975 more than that of Essex. This instance he regards as perhaps more glaring than any other to be found in the returns, but believes as a general rule it will obtain throughout. The assessors having no opportunities of consultation, and comparison of views, have produced almost as many variations and inequalities in their assessments as there are districts in the State. The remedy which he suggests is that Congress, composed as it is of representatives from all sections, should take the average of assessments now to be found in the returns from all the States, and either agree upon that as a uniform price or value hereafter to control the assessors, or divide the Confederacy either by grand divisions, having reference to soil, climate and productions, and vary the rate to suit the circumstances of each, or adopt a uniform value in each state to govern the assessors in future.
10. The only remaining States to be considered are Texas and Mississippi, and as has been stated, the only States in which the war tax is being collected by Confederate officers, all the others having assumed the tax. In Mississippi all the districts in the State have been duly assessed and returned, and the amount of tax thus assessed, as shown by the chief collector's collated list, in the whole State, is $2,240,813 43, and of this amount there has been collected and paid into the Treasury $2,052,304 96.
Suspension of collections has only been asked by the chief collector in one instance, that of the county of Tishomingo which has long been in the possession of the enemy. Nevertheless, since asking this suspension the collector of that county has deposited with the chief collector about $18,000.
11. Texas.--Collated lists of property rendered for assessment of non-rendered property, and property of alien enemies returned by receivers under the sequestration laws, have been received from the chief collector, which show an aggregate valuation of $318,214,621, the tax upon which is $1,653,917 80, the tax upon unrendered property being rated at one per cent. There has been collected and paid into the Treasury $1,211,918 21, leaving a balance of $441,999 59.
Some months ago it will be recollected that large amounts of spurious Treasury notes were put into circulation, and in the State of Texas, it is reported that large sums were paid out for beef-cattle, the consequence of which, in part, has been that several district collectors of the war tax have come into possession of these notes in the prosecution
Page 30
of their collections, and not knowing from whom the notes were received, they have applied through the chief collector to the Department for relief. The chief collector has been informed by the Hon. Secretary, that he possessed no authority to allow the collectors credit for these notes in the settlement of their indebtedness to the Government. The result will be that they will be required to make all such sums good, unless Congress should grant them relief.
It is well known that the larger denominations of these spurious notes were so skilfully executed that ordinary vigilance could not detect them, and as the loss thus falling upon unsuspecting collectors, would in some cases not only deprive them of their salaries, but subject them to serious loss besides, I have thought proper to advert to the subject as one which appeals to the justice and liberality of Congress. If an act for their relief should be passed, I would suggest the propriety of requiring from each collector claiming its benefit, a statement under oath as to the manner in which he obtained possession of such notes, and that he was ignorant that the same were not genuine.
Before closing this report I beg leave through the Hon. Secretary, to call the attention of Congress to the following suggestions. And first, as to the necessity of additional legislation in reference to the redemption of real property sold for taxes under sec. 12, act 19th August 1861, and as to the mode and manner of refunding purchase money after the lands have been redeemed. Under the section named the owners, their heirs, &c., shall have liberty to redeem any lands and other real property sold for taxes within two years from the time of sale, upon payment to the collector, for the use of the purchaser, his heirs, &c., of the amount paid by such purchaser, with interest for the same, at the rate of twenty per centum per annum. The 3d proviso of same section, provides that when the owner shall be in the military service he shall have the same privilege within two years after the close of his term of service. The collector of the district in which the property is sold, is the officer intrusted with the execution of these provisions, and under the act becomes the trustee of the purchaser to the amount of purchase money received, but the act is silent as to what disposition he shall make of it, whether he shall pay it over to the purchaser himself, or to the chief collector. But the office of chief collector must expire and become vacated long before the time of redemption will expire. When the chief collector's office is vacant there is no one designated to receive money from the collector, for all his transactions must be through the chief collector. Under the act all the official dealings of the department are confined to the chief collector. The collectors functions will also expire before the time of redemption, and in that event there will be no officer at all to receive redemption money.
It is, therefore, obvious that Congress should make provision for these emergencies, and designate some officer to whom owners may apply for the redemption of their property, at any time within the period allowed by law, and also direct what disposition such officer shall make of such funds. If the present system of taxation be continued, then the new officers would stand in place of the old and continue
Page 31
their duties. It would seem right and proper to authorize the trustee to settle with the owner near his home, without compelling him to go through all the forms and delay of drawing his money from the treasury.
Judge Handy, chief collector of Mississippi, represents that the collectors of that State have almost uniformly presented, for his approval, accounts for postage on letters and tax books sent to him, and for express charges upon assessment and receipt books; also, accounts for travelling expenses to and from his office, to make their payments as required by instructions. He properly decided that the present law did not provide for the allowance of such incidental expenses to the collectors. He further states that the expense of travel to make deposits, by those collectors living at a remote distance, has been onerous, and, if not refunded to them, will render the real compensation very unequal to that of those residing near him. It would seem to me just and proper to provide for the payment of all necessary postage and express charges for the transmission of tax and receipt books, and that those living at a distance, who have expended large sums travelling to make their deposits, should have the amount refunded to them, or each should be allowed a certain amount as mileage to defray these expenses. The same reasons will apply to Texas, but with greater force, by reason of the greater extent of her territory.
Owing to the difficulty, and sometimes impossibility of getting suitable persons to act as assessors, in certain localities, it has been necessary, in a few instances, to entrust the duties of assessment to the collector himself; and, in such cases, as the law will allow only the compensation of one office, it seems to me that provision should be made authorizing the payment of both the compensation of collector as well as that of assessor, as he performs the duties of both.
In some districts in States that have assumed the war tax, no collector has been appointed, and in others he has died or left the office vacant by going into the military service; and in such cases, it has been found necessary to appoint what are termed supervising assessors. The authority for this is derived under section 7, of the supplemental act of 19th December, 1861. These have performed all the duties of collector, and as some doubt exists as to the authority to pay them the compensation of collector, it would be well to provide compensation for them by act of Congress.
In view of the probable legislation of Congress in reference to the war tax during the coming session, it will not be inappropriate to advert briefly to the ten per centum allowed by the act of 19th August, 1861, to such States as have assumed the war tax assessed upon their citizens. The presumption is at least reasonable, that this per cent. was merely intended as indemnity to cover the expense the States would necessarily incur, in collecting the tax from the people, and that no portion of it was granted as a bonus or pecuniary inducement to the States, beyond the actual expense of collection. Nor is it supposed that the object of any State, in accepting the offer, was to speculate and make money out of the Confederate States, but rather to protect her own citizens from hardship and inconvenience, by extending
Page 32
to them that indulgence in the payment of their taxes, where necessary, which the Confederate States could not, in the nature of things afford to grant. The actual results, however, in the States that have not assumed the tax, and in which the situation has been collected by Confederate officers, conclusively show that the per cent. allowed is far greater than was necessary to cover the expense of collection. In the State of Mississippi, for instance, where the nett tax is $2,240,813, the actual expense of collection, as shown by the aggregate sum of the salaries of the collectors is less than $40,000. The total amount assessed in the States which have assumed the tax is $17,057,192, out of which $1,705,719 is deducted as the ten per centum on that amount, to which add the compensation of the collectors in those States of $400 each, say $220,000, and we find that the average expense of collection in the States that have assumed is $213,968, whilst, in the State of Mississippi, as already mentioned, where the tax is collected by Confederate officers, the whole expense does not exceed forty thousand dollars, or less than one-fifth of that in the other States.
One of the most cherished and commendable objects of Congress in raising revenue to carry on the war, has been to absorb, as much as possible, the great redundance of circulating currency issued in consequence of the necessities of the war, but the policy of giving the States a heavy premium to assume the tax of their citizens, not only involves a positive loss to the Government of considerably over one million of dollars, but seems to be in direct conflict in its results, with the policy of reducing the amount of circulating currency. For in some of the States that have assumed the tax their own treasury notes have been issued equal in amount to that assumed, so that the effect is to increase rather than diminish the paper currency of the country. In my humble judgment it is the better policy, in every way, for the Government to collect its own taxes from the people, who are not only willing, but able to pay them.
I would respectfully refer to the present method settling accounts for expenses of collecting the tax, as one involving much unnecessary delay and expense, besides preventing the possibility of keeping an accurate account of the settlement and suspensions. By the system now in use, this office is one of register only, the accounts passing for settlement through the hands of the Auditor and Comptroller, and being filed in the office of the Register, without any information of the settlement being conveyed to this office, so that we are absolutely ignorant of the disposition made, or to be made, of the accounts as they pass from our hands, and unable to supply the information which is daily demanded of us, without oscillating perpetually in the other offices. In addition to this a large amount of correspondence is required by this digressive system, and much superfluous labor expended upon its prosecution which might otherwise be avoided. I would, therefore, earnestly urge upon the Secretary, the importance of having a disbursing clerk appointed, who shall be bonded for the faithful performance of his duties, and shall be finally accountable to the Auditor for all settlements. This would ensure immediate action
Page 33
upon all accounts, and, by devoting all correspondence with regard to the expenditures to his care, would enable him, comprehensively and intelligently, to render to the Department a clear and faithful exhibit of the expenses of collection, at the same time that he is doing justice to the respective claimants by speedy action upon their accounts.
In conclusion, I beg leave to recommend the suggestions contained in my report to the Secretary dated 1st August, 1862, and especially those in reference to the compensation of collectors in any future act that may be passed: that is, to allow them a given per cent. on such an amount collected, and a diminished per cent. on all sums beyond such amount, thereby offering a personal inducement for a close and rigid collection of all the taxes assessed.
Respectfully submitted.
T. ALLAN,
Chief Clerk of War Tax.
Page 34
COL. GARNETT'S TABLES IN REFERENCE TO VIRGINIA.
(Table No. 1)
Exhibiting total value of real estate and personal property in the State of Virginia, in the year 1860. The total value in the districts now assessed in the same year, and the total amount actually assessed by war tax assessors in 1861. Also, the amount remaining unassessed, supposed to be caused by the exceptions of the war tax act, such as Confederate Bonds and estates of less value than $500, &c.
| Total value of real and personal property in the State of Virginia, in the year 1860, | $934,261,305 00 | |
| Total value of ditto in the districts now assessed in the same year, 1860, | 772,121,746 00 | |
| Total value of ditto in the unassessed districts, | $162,139,559 00 | |
| Total value as above of assessed districts, | $772,121,746 | |
| Total war tax assessments, | 548,164,263 | |
| Exemptions by war tax act, | $223,957,483 |
(Signed,) H. T. GARNETT,
Chief Collector C. S. War Tax for Va.
(Table No. 2.)
Exhibiting the total values of real and personal property in the districts now assessed in the year 1860. The amount actually assessed by war tax assessors in 1861. Total of the tax at one-half of one per cent.
| Total value of real and personal property in the assessed districts in 1860, | $772,121,746 00 |
| Total value of ditto actually assessed by war tax assessors 1861, | 548,164,263 00 |
| Total of tax at half of one per cent. | $2,740,821 00 |
(Signed,) H. T. GARNETT,
Chief Collector C. S. War Tax for Va.
Page 35
(Table No. 3.)
Exhibiting total value of real and personal property in the districts unassessed in the year 1860. The total estimated amount of the assessment under the war tax act had it been made, being in exact proportion in these as the actual assessment exhibits in the assessed districts. Also the tax upon this estimate at one-half of one per cent.
| Total value of real and personal property in the districts unassessed in 1860, | $162,139,559 00 |
| Total estimated value had assessment been made by war tax assessors in 1860, | 115,239,743 00 |
| Total tax upon this estimate at half of one per cent. | 576,198 00 |
(Signed,) H. T. GARNETT,
Chief Collector C. S. War Tax for Va.
(Table No. 4)
Exhibits the total population of the State by the census of 1860, total population of the districts assessed by war tax assessors, 1861, and the total population of districts not assessed.
| Total population, white, free colored and slave, in State of Virginia, by census of 1860, | $1,595,814 00 |
| Total in districts assessed for war tax 1861, | 1,201,331 00 |
| Total in districts unassessed for war tax 1861, | 394,483 00 |
(Signed,) H. T. GARNETT,
Chief Collector C. S. War Tax for Va.
Page 36
Table B.
Showing the average values of certain kinds of property as assessed and returned in
the several States, under the War Tax Act, of August 19, 1861.
States.
Real Estate.
Slaves.
Horses, Cattle, &c. Gold Watches.
Pianos.
Pleasure Carriages. Alabama. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . . Arkansas. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . . Florida. . . . .
4.98
437.08
5.54
72.63
187.36
96.11 Georgia. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . . Louisiana. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . . Mississippi. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . . North Carolina. . . . .
3.45
326.83
. . . . .
82.68
197.74
74.17 South Carolina. . . . .
6.69
452.79
28.87
70.80
173.79
79[.]64 Tennessee. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
. . . . . Texas. . . . .
2.09
516.13
10.85
76.84
217.56
123.64 Virginia. . . . .
10.12
350
25.50
57.60
133.67
73.33 General Average,
$5.46 pr Acr.
$416.56 pr cap
$17.69
$72.12
$182.02
$89.87
Page 36a
Table A.
| Real Estate. | Slaves. | Merchandize. | Bank Stock. | Railroad & other corporation stock. | Money at Interest | Cash on hand. | Horses, Cattle, &c. | Gold Watches. | Gold and Silver Plate. | |
| Alabama*. . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . |
| Arkansas*. . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . |
| Florida. . . . . | 15,507,608 00 | 24,117,256 00 | 746,598 00 | 403,537 00 | 331,049 00 | 6,087,169 00 | 675,300 00 | 982,381 00 | 142,314 00 | 62,062 00 |
| Georgia. . . . . | 185,185,452 94 | 236,243,819 83 | 8,713,671 89 | 20,259,541 65 | 8,786,743 50 | 89,911,139 34 | 5,137,175 64 | 753,314 63 | 1,061,480 50 | 563,164 50 |
| Louisiana*. . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . |
| Mississippi. . . . . | 152,626,126 00 | 227,176,794 00 | 5,286,247 00 | 464,311 00 | 1,463,951 00 | 53,078,192 00 | 2,668,397 00 | 291,495 00 | 853,997 00 | 452,231 00 |
| North Carolina. | 97,537,424 00 | 105,467,096 00 | 3,541,109 00 | 7,217,892 00 | 3,303,404 00 | 60,257,231 00 | 4,611,524 00 | 345,387 00 | 534,240 00 | 268,373 00 |
| South Carolina. . | 111,770,934 00 | 184,598,640 00 | 5,292,594 00 | 18,766,682 00 | 10,459,289 00 | 64,895,125 00 | 3,535,471 00 | 117,014 00 | 852,273 00 | 946,029 00 |
| Tennessee*. . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . | . . . . . |
| Texas *. . . . . | 124,311,376 00 | 97,959,814 00 | 6,665,561 00 | . . . . . | 3,527,204 00 | 32,206,181 00 | 2,667,412 00 | 34,046,502 00 | 619,426 00 | 128,839 00 |
| Virginia. . . . . | 257,758,827 50 | 150,48,722 84 | 9,883,446 59 | 14,176,380 00 | 15,396,742 63 | 81,776,286 63 | 8,182,559 06 | 3,508,083 68 | 893,979 50 | 748,766 48 |
| Pianos. | Pleasure Carriages. | Stock not returned by corporations | Aggregate. | Tax, 1/2 per cent. | Nett Tax. | Am't paid in Treas'y to Dec. 1, 1862. | Balance Due. | Remarks. | |
| Alabama*. . . . . | . . . . . | . . . . . | . . . . . | 400,000,000 00 | 2,000,000 00 | 1,800,000 00 | 2,000,000 00 | a 200,000 00 | a Overpaid Estimate. |
| Arkansas*. . . . . | . . . . . | . . . . . | . . . . . | 145,000,000 00 | 725,000 00 | 652,500 00 | 400,000 00 | 252,500 00 | . . . . . |
| Florida. . . . . | 79,817 00 | 274,421 00 | 71,049 00 | 49,480,561 00 | §251,233 19 | 226,109 88 | 225,374 11 | 735 77 | §Double Tax included. |
| Georgia. . . . . | 846,984 50 | 3,351,457 00 | t 3,410,000 90 | 564,174,036 00 | c2,771,286 01 | 2,494,112 41 | 2,477,218 18 | 16,894 23 | t Default List. |
| Louisiana*. . . . . | . . . . . | . . . . . | . . . . . | 539,111,240 00 | 2,695,556 20 | 2,426,000 58 | 2,426,000 00 | 58 | . . . . . |
| Mississippi | 798,470 00 | 2,116,805 00 | 481,424 00 | 447,708,440 00 | 12,240,813 411/2 | || 2,240,813 41 | 2,052,304 96 | 188,508 45 | || Including tax on additional uncollected return. |
| North Carolina. | 475,975 00 | 1,950,836 00 | 895,184 00 | 286,405,625 00 | 1,432,028 12 | 1,288,825 81 | 1,288,825 81 | . . . . . | . . . . . |
| South Carolina. . | 620,635 00 | 1,577,849 00 | 1,086,313 00 | 399,468,798 00 | 1,997,343 99 | ¶1,798,076 52 | 1,651,528 55 | 146,547 97 | ¶Double Tax included. |
| Tennessee*. . . . . | . . . . . | . . . . . | . . . . . | 490,000,000 00 | 2,450,000 00 | 2,205,000 00 | 1,030,069 25 | 1,174,930 75 | . . . . . |
| Texas *. . . . . | 395,974 00 | 1,341,021 00 | . . . . . | 303,869,310 00 | 1,519,346 55 | 1,519[,]346 55 | 1,211,918 21 | 307,428 34 | * See remark below. |
| Virginia. . . . . | 821,425 00 | 2,138,334 25 | 2,455,661 85 | 548,164,215 91 | 2,740,821 07 | 2,466,788 97 | 2,125,000 00 | 341,738 97 | . . . . . |
* No assessment returns having been received from these States, their aggregates are respectively based upon estimates.
c After deducting for errors, as appears by report of Chief Collector.
* The return for Texas does not include the Tax upon Sequestered, or non-rendered property, which will yield an additional estimated revenue of $134,571 25.
TREASURY DEPARTMENT, SIR:--In obedience to your order, I have the honor to make the
following report of the operations of this office, during the past year. The whole amount of subscriptions to the produce loan, taken
chiefly in the year 1861, by Commissioners in the several States appointed
by you, is as follows: Cotton, 431,347 bales, worth at
$50 per bale, $21,567,350; cash, $608,375; miscellaneous, $895,180;
giving a total of $23,070,905. To this may be added new subscriptions
taken during the past year of upwards of $2,000,000,
making the amount of the entire subscription a little over $25,000,000. To collect these subscriptions a General Agent was appointed in
each of the States, with authority to appoint as many sub-agents as
might be necessary to enable him to perform efficiently the duty entrusted
to him and at the same time afford proper facilities to the
subscribers in making payments. These agents, in most cases, have
rendered weekly reports of their transactions to this office, and bonds
have been promptly furnished to them by the register of the Treasury
for distribution to the parties concerned. Owing to the fact, that the market for cotton has been very limited,
arising from the blockade of our ports and the general condition of
the country, the amount of collections has not been so large as was, at
first, anticipated. The following statement embraces the results gathered
from the reports, made up to the latest period, received at this
office:
Page 37
Produce Loan Office,
January 9, 1863.STATEMENT.
Amount collected in Georgia,
$1,898,950 00 "" Alabama,
1,421,670 00 "" South Carolina,
886,050 00 "" Louisiana and Miss.,
259,864 00 "" Florida,
170,650 00 "" North Carolina,
63,200 00 "" Texas,
58,450 00 "" Virginia,
19,200 00 Total,
$4,778,034 00 Add to the above new subscriptions collected by produce loan agents in South Carolina, $2,854,010 00 Grand total,
$7,631,044 00
The above amount embraces only the payment of cash subscriptions and the proceeds of the sale of produce, consisting principally of cotton. In addition to this, so far as the reports already receive from the agents show, about 5,000 bales, estimated to be worth
Page 38
$250,000 have been purchased by the Government, for bonds, from subscribers to the loan. This, added to the grand total above, will give $7,882,044 as the entire amount realized up to this time from subscriptions to the produce loan, or nearly one-third of its whole amount.
The cost of collecting these subscriptions has been very small, amounting only to about $19,000, or less than one-third of one per cent.
The names of all the parties making the above payments have been appropriately entered in alphabetical order on the books of this office.
To carry into effect the act of April 21st, 1862, the produce loan agents and other special agents appointed for the purpose, have been required under the regulations of May 21st, 1862, issued by you, a copy of which you will find enclosed, to make purchases of cotton on plantations and in warehouses in towns and at railroad stations. This business being entirely new, some delay occurred in organizing a system of conducting it and of putting the necessary machinery into operation and of preparing the proper blanks and books for the use of the different agents, and of this office. These preliminary difficulties having been overcome