202 Early History of American Auctions 



Certain abuses were provided against in 1824^"'' and the whole 

 auction law was overhauled with respect to Philadelphia and 

 Pittsburgh in 1842.^^" No evidence appears in any of this legis- 

 lation of an animus to the auction system ; it too was w'holly 

 regulatory and fiscal in purpose. 



This summary of the legislation of two leading commercial 

 States is illustrative of the legislative situation with respect to 

 auctions. 



FEDERAL LEGISLATION. 



Until 1 81 7 auctions received consideration by Congress as a 

 source of revenue only. The question of the advisability of 

 taxing auction sales was a part of the more general question 

 between the Republicans and Democrats whether the government 

 should depend upon internal revenue duties. Jefferson and 

 Gallatin opposed the plan on the grounds that it contravened the 

 principles of liberty and was inquisitorial, that it was injurious 

 to the morals of the people, that industry was injured by it, that 

 it invaded the rights of States, that it operated unequally in dif- 

 ferent sections of the country, that it was unpopular and unwise 

 politically, etc. Hamilton and the Federalists saw social, political 

 and fiscal ddvantages in direct and internal revenue taxes. In 

 1794 the House Committee proposed a tax of 1% on sales at 

 auction and estimated a yield of $100,000.^^^ The act passed 

 that year imposed duties of one-quarter of 1% on auction sales 

 of real estate, farming implements and stock, ships and vessels, 

 and of one-half of 1% on sales of all other "goods, chattels, 

 rights, and credits." The auctioneers were to pay the duties, 

 were licensed, put under bond, subjected to district supervision, 

 and required to make reports to the Treasury; no licenses were 

 granted in a state or town where that state or town provided for 

 licensed auctioneers. The auctioneers were allowed 1% com- 

 mission. The act was to be in operation two years, but it was 



^"Act of 1824, chapter 100. 



'®"Act of 1842, chapter 90. New York prohibited the sale of stocks and 

 bonds at auction, but Pennsylvania permitted such sales and subjected 

 them to a duty of i^%, whereas the duty was ij/j% on all other sales 

 except on real estate or shipping. 



^°' Annals of Congress, 3d Congress, ist session, p. 1307. 



