HOW TO RAISE REVENUE. 739 



returned at 181,494,000 pounds, as compared with 83,346,000 manu- 

 factured for smoking. 



From 1863 (when the tax was first imposed on this commodity) 

 to 1869 the variations in the annual internal revenue receipts from 

 tobacco (always in the way of increase) were very great and, as 

 it were, spasmodic, and were due mainly to frequent changes in 

 the rate of tax on the different forms of tobacco. During this 

 same period occurred one of the most remarkable illustrations to 

 be found in fiscal history of the influence of a tax reduction in 

 increasing the consumption of a comparatively cheap commodity 

 in general use. Thus, in 1866, with a uniform tax of ten dollars 

 per thousand on cigars, only 347,443,894 were returned by manu- 

 facturers for taxation, while in 1869, under a uniform tax of five 

 dollars per thousand, 991,335,934 were returned, or nearly three 

 times the quantity. 



From ] 870 to 1882 the ratio of annual increase in the taxed 

 product of domestic tobacco was greater on the average than the 

 corresponding ratio of increase in the population of the country ; 

 and in the latter year the annual internal revenue collected from 

 this source attained the large and unprecedented aggregate of 

 $47,391,989. 



In 1883 the rates of tax on all forms of domestic tobacco and 

 the special taxes on dealers and manufacturers of the same were 

 reduced fully fifty per cent. This reduction of tax caused an im- 

 mediate reduction of revenue, comparing the receipts of 1883 with 

 those of 1884, the first full year of reduced rates, to the extent of 

 $21,329,589. In 1886 the tax on cigars was further reduced fifty 

 per cent, and in 1890 the taxes on snuff, chewing and smoking 

 tobacco, twenty-five per cent. At this latter date all special taxes 

 relating to tobacco i. e., licenses to manufacturers, dealers, etc. 

 were also entirely repealed. The annual reduction in revenue in 

 consequence of these last abatements, comparing the receipts for 

 1890 with those for 1892, was near $3,000,000, notwithstanding an 

 increase in population during the same period of 2,897,750. The 

 internal revenue from tobacco for the fiscal year 1896 was $30,- 

 711,629, an increase of $1,006,721 over the receipts for 1895, and 

 a decrease of $3,277,372 as compared with the receipts of 1890. 

 Had the taxes on tobacco existing in 1882 been allowed to remain 

 unchanged, the annual revenue from this source (the increase of 

 population being taken into account) for the fiscal year 1897 would 

 probably have approximated $70,000,000. 



The United States internal revenue taxes on tobacco are 

 smaller than those imposed by any other country that seeks to 

 make this commodity a leading source of revenue. In the year 

 1895 they amounted to about forty cents per capita. The duties 

 collected on imports of tobacco for 1895 were $14,916,000, and 



