ii4 
Report  on  Alcohol  Legislation. 
I  Am.  Jour.  1'liarru. 
1   February,  1895. 
in  1S94,  Congress  intended  to  place  an  additional  burden  of  taxation  on  manu- 
facturers who  necessarily  use  that  article  in  their  operations.  The  very  fact,  that 
section  61  was  incorporated  in  the  same  act  is  an  admission  and  a  positive 
proof  that  the  legislative  branch  of  the  government  recognized  as  a  distinct 
matter  of  principle  that  alcohol  for  legitimate  manufacturing  purposes,  should  be 
exempt  from  all  taxation.  It  is  admitted  that  the  evident  intention  of  this  act 
was  to  grant  that  relief  which  had  so  long  been  prayed  for  by  druggists  and 
other  manufacturers.  It  behooves  us  to  cling  tenaciously  to  this  legislative 
concession  and  not  permit  the  Government  to  recede  from  its  admitted  inclina- 
tion to  correct  a  long  standing  injustice. 
Section  61  of  the  Customs  Law  of  1894,  reads  as  follows  : 
"Any  manufacturer  finding  it  necessary  to  use  alcohol  in  the  arts,  or  in  any 
medicinal  or  other  like  compound,  may  use  the  same  under  regulations  to  be 
prescribed  by  the  Secretary  of  the  Treasury,  and  on  satisfying  the  Collector  of 
Internal  Revenue  for  the  district,  wherein  he  resides  or  carries  on  business,  that 
he  has  complied  with  such  regulations  and  has  used  such  alcohol  therein,  and 
exhibiting  and  delivering  up  the  stamps  which  show  that  a  tax  has  been  paid 
thereon  shall  be  entitled  to  receive  from  the  Treasury  of  the  United  States  a 
rebate  or  re-payment  of  the  tax  so  paid." 
A  careful  study  of  this  act  convinces  us  that,  although  in  some  respects  some- 
what indefinite,  it  is  a  more  simple,  much  wiser  and  more  equitable  provision 
than  any  of  the  previously  proposed  acts. 
As  man}'  of  the  newspapers  and  pharmaceutical  journals  have  commented 
upon  this  act  and  placed  constructions  upon  its  wording  which  your  committee 
deems  unwarranted,  we  would  offer  a  few  comments  on  its  provisions. 
The  introducing  words  "any  manufacturer''''  show  that  it  was  not  intended 
to  limit  the  operating  of  this  act  to  only  the  larger  manufacturers.  The  use  of 
alcohol  in  large  quantities  was  not  the  requisite.  The  act  was  to  be  general ; 
to  include  all  manufacturers  whose  products  were  used  in  the  arts  or  medicine. 
The  words  medicinal \  compound"  indicate  that  the  intent  was  to  include 
all  products  used  in  medicine  in  which  alcohol  is  necessarily  a  component 
part,  and  as  such,  really  a  medicine  itself,  and  not  only  products  in  which  the 
alcohol  has  by  chemical  process  undergone  change  so  as  to  entirely  destroy  its 
identity.  This  narrow  construction  would  limit  the  use  of  tax-free  alcohol  to 
only  a  few  manufacturers  of  chloroform,  ether,  etc.  It  is  even  doubtful,  if  such 
chemical  products  could,  with  the  correct  meaning  of  the  phrase,  be  classed 
with  "medicinal  compounds 
Your  committee  wrould  submit,  that  whatever  regulations  are  prescribed  by 
the  Secretary  of  the  Treasury  or  enacted  by  Congress  for  carrying  this  law  into 
effect,  they  should  be  in  harmony  with  the  evident  intent  of  the  law.  They 
should  be  simple  and  general  and  not  discriminate  in  favor  of  only  a  fewr  manu- 
facturers. In  this  respect,  it  has  been  generally  assumed  by  the  public  press 
that  those-  manufacturers  who  obtained  the  benefit  of  this  act  would  be  com- 
pelled  to  establish  a  bonded  warehouse  and  be  subjected  to  the  accompanying 
expense  and  espionage,  and  they  assume,  erroneously,  that  manufacturers 
would  be  permitted  to  withdraw  alcohol  from  bond  without  payment  of  the  tax. 
It  is  rather  surprising  that  a  writer,  usually  so  well  informed,  as  the  Washing- 
ton correspondent  of  the  Philadelphia  Public  Ledger,  should  as  late  as  January 
r,  [895,  state  that  "  the  Tariff  Act  authorizes  the  withdraiual  of  alcohol  without 
