A Sketch of the Finances of the United States. By Albert Gallatin. New York: Printed by William A. David, No. 438 Pearl Street. 1796.
[…] The tax upon snuff manufactured within the United States, was first laid on the quantity manufactured, at the rate of eight cents per pound, and during the six months ending on the last day of March 1795, while it remained in that shape, is stated to have yielded only 2,400 dollars; in which account, however, are not included the returns of the first survey of Pennsylvania, and for the state of Delaware, which pay about one half of the duty. From the first of April 1795, the tax has been laid on the mills employed in the manufacture, as is stated for the six following months, to have produced 7,112 dollars, but on account of deficient statements, may be estimated for one year at about 20,000 dollars. But, during the same period, the drawbacks allowed, at the rate of six cents per pound, seem to have excluded the amount of gross revenue. From the first of April 1795, to the 23rd of February 1796, there were exported, from the port of Philadelphia alone, 237,000 lb. and, from the shipments then going on, there is little doubt that the quantity exported from that port, for the whole year ending on the first of April 1796, amounted to 350,000 lb; the drawbacks whereon would form a sum of 21,000 dollars. The quantity exported was even increasing; for, of the above 237,000 lb, only 75,000 were exported during the sixth [sic] first months, and 162,000 during the five last. In fact snuff was amnufactured for exportation, for the sake of the drawback which operated as a bounty. An alteration in a revenue law, which thus drained the treasury, instead of yielding a revenue, became necessary. The difficulty of rendering the duty equal, on account of the great difference in the relative situation and powers of the mills, the consequent complaints of the small manufacturers, the necessity of allowing a drawback upon the exportation of an article both of the growth and of the manufacture of the United States; the impossibility of fixing a drawback on the quantity of the article, proportionate to the duty laid on the machinery employed in manufacturing that article, together with the evasions stated to have taken place, by hand-mills employed in vaults, where the noise could not be heard, determined Congress, during last session, to suspend the law for one year. As the suspension may continue, and as, unless an entirely new plan is proposed and adopted, this duty cannot yield any thing, it cannot at present be counted amongst the productive branches of revenue.