6 BULLETIN 182, U. S. DEPARTMENT OF AGEICULTUEE. 



lation of 1887 clearly taught the lesson that the future growth of 

 the consumption of distilled alcohol as a beverage would not be 

 permitted to keep pace with the actual growth in population. Other 

 outlets for the use of alcohol had to be sought, for the industry was 

 greatly in need of expansion. 



TAX REFUNDS ON INDUSTRIAL ALCOHOL. 1879 AND 1887. 



The law of 1879 had already empowered the Council of the Rep- 

 resentatives of the German States (Bundesrath) to grant the same 

 refund of taxes on industrial alcohol that was granted to exported 

 spirits. The first statistical data concerning the consumption of 

 alcohol for industrial purposes date from this period. During the 

 fiscal year 1880-81, 2,462,111 gallons (9,320,000 liters) were thus 

 consumed. This quantity increased until in 1886-87 it amounted to 

 4,837,044 gallons (18,310,000 liters) ; that is, it had almost doubled in 

 six years. Yet this amount is insignificant when compared with the 

 drop in consumption of 21,134,000 gallons (80,000,000 liters), due 

 to the tax levied on the finished product when disposed of 

 (Abgabesteuer). 



While the law of 1887 had introduced the heavy tax on the 

 finished product, it also brought absolute relief from taxation of 

 all alcohol for purposes other than as a beverage within the 

 boundaries of Germany. The inconveniences which hampered the 

 free use of the tax-free alcohol granted in principle by the law of 

 1879 were removed, and the completely denatured alcohol became as 

 free as any other commercial commodity after 1887. Though the 

 price of alcohol consumed for beverage purposes was greatly in- 

 creased through the laws of 1887, the price of that used for technical 

 purposes was lowered. 



The results are best expressed in figures. As already stated, the 

 quantity of technical or industrial alcohol used in 1886-87 in the 

 States which were included within the whisky-tax union as consti- 

 tuted before 1887, was 4,834,402 gallons (18,300,000 liters). The 

 quantity thus used immediately jumped to 8,215,842 gallons 

 (31,100,000 liters) for this territory, and to 10,223,572 gallons 

 (38,700,000 liters) for the entire German Empire. 



INCREASE IN TECHNICAL APPLICATIONS OF ALCOHOL. 



After 1887 there was a constant increase in the consumption of 

 alcohol for technical purposes. However, an increase in consump- 

 tion which would correspond to the demand for expansion was 

 attainable only when this alcohol could be produced at a suffi- 

 ciently low price. It was soon recognized that the most important 

 field in which this consmnption could be looked for was in its appli- 

 cation to the production of heat, light, and power. Its use for the 



