1 5 2 THE POPULAR SCIENCE MONTHLY. 



of five hundred dollars and house rent actually paid. Incomes 

 in excess of five thousand dollars and not in excess of ten thou- 

 sand dollars were taxed two and a half per cent in addition, and 

 incomes over ten thousand dollars, five per cent additional, with- 

 out any allowance or exemptions whatever. Nearly every indus- 

 trial product was taxed. Cotton was taxed at the rate of two 

 cents per pound; salt, six cents per hundred pounds; tobacco, 

 from fifteen to thirty-five cents per pound; cigars, from three 

 to forty dollars per thousand ; sugar, from two to three cents and 

 a half per pound. Distilled spirits were taxed progressively ; first 

 at twenty cents, and finally at two dollars per proof gallon. 



But the most curious and complex taxes were those imposed 

 on the various products of what may be termed ordinary manu- 

 facturing industry a tax, by intent or construction, being first 

 imposed on the raw material, and then on the total or increased 

 value, according to circumstances, of each successive stage of its 

 elaboration up to the finished product. And, as if this was not 

 enough, every manufacturer was compelled to take out an annual 

 license, while the goods produced, if sold by dealers or agents 

 independent of the manufacturers, were subject to an additional 

 tax of one tenth of one per cent, reckoned upon the amount of 

 sales. This tax upon manufactures and products, with the excep- 

 tion of a few articles, was at first fixed, in 1864, at an average of 

 five per cent ; but in 1865 the rate was increased twenty per cent, 

 making the tax for most articles six per cent. 



Under the operation of this system the Government actually 

 levied and collected on many articles of finished industrial prod- 

 ucts a tax of six per cent, the effect of which may be thus illus- 

 trated : Many manufacturing establishments sold products an- 

 nually to three times the amount of their invested capital. If the 

 capital invested was one hundred thousand dollars and the sales 

 three hundred thousand, the tax on that business was eighteen 

 thousand dollars, or eighteen per cent on the cost of the establish- 

 ment. 



The sales of its products by a manufacturing establishment are, 

 however, no indication of its profits. It may make and sell to the 

 amount of a million dollars without making a dollar of profit, 

 but that, under the law, was no reason for the nonassessment and 

 noncollection of a tax of sixty thousand dollars on the value of 

 the product represented by its sales. 



Again, the effect of the tax on every stage of elaboration of a 

 manufactured product may be illustrated by a great variety of 

 actual examples. Thus, in the case of the manufacture of um- 

 brellas and parasols, it was shown that separate taxes were paid, 

 first, on the sticks or supporting rods ; then upon the handles, if 

 carved or turned separately, of bone, wood, or ivory ; then, in like 



