Financial Legislation—Internal Taxes.
The Financial legislation during the war was as follows:
1860, December 17—Authorized an issue of $10,000,000 in Treasury notes, to be redeemed after the expiration of one year from the date of issue, and bearing such a rate of interest as may be offered by the lowest bidders. Authority was given to issue these notes in payment of warrants in favor of public creditors at their par value, bearing six per cent. interest per annum.
1861, February 8—Authorized a LOAN of $25,000,000, bearing interest at a rate not exceeding six per cent. per annum, and reimbursable within a period not beyond twenty years nor less than ten years. This loan was made for the payment of the current expenses, and was to be awarded to the most favorable bidders.
March 2—Authorized a LOAN of $10,000,000, bearing interest at a rate not exceeding six per cent. per annum, and reimbursable after the expiration of ten years from July 1, 1861. In case proposals for the loan were not acceptable, authority was given to issue the whole amount in Treasury notes, bearing interest at a rate not exceeding six per cent. per annum. Authority was also given to substitute Treasure notes for the whole or any part of the loans for which the Secretary was by law authorized to contract and issue bonds, at the time of the passage of this act, and such treasury notes were to be made receivable in payment of all public dues, and redeemable at any time within two years from March 2, 1861.
March 2—Authorized an issue, should the Secretary of the Treasury deem it expedient, of $2,800,000 in coupon BONDS, bearing interest at the rate of six per cent. per annum, and redeemable in twenty years, for the payment of expenses incurred by the Territories of Washington and Oregon in the suppression of Indian hostilities during the year 1855–’56.
July 17—Authorized a loan of $250,000,000, for which could be issued BONDS bearing interest at a rate not exceeding 7 per cent. per annum, irredeemable for twenty years, and after that redeemable at the pleasure of the United States.
Treasury notes bearing interest at the rate of 7.30 per cent. per annum, payable three years after date; and
United States NOTES without interest, payable on demand, to the extent of $50,000,000. (Increased by act of February 12, 1862, to $60,000,000.)
The bonds and treasury NOTES to be issued in such proportions of each as the Secretary may deem advisable.
August 5—Authorized an issue of BONDS bearing 6 per cent. interest per annum, and payable at the pleasure of the United States after twenty years from date, which may be issued in exchange for 7.30 treasury notes; but no such bonds to be issued for a less sum than $500, and the whole amount of such bonds not to exceed the whole amount of 7.30 treasury notes issued.
February 6, 1862—Making $50,000,000 of notes, of denominations less than $5, a legal tender, as recommended by Secretary Chase, was passed January 17, 1862. In the House it received the votes of the Republicans generally, and 38 Democrats. In the Senate it had 30 votes for to 1 against, that of Senator Powell.
1862, February 25—Authorized the issue of $15,000,000 in legal tender United States NOTES, $50,000,000 of which to be in lieu of demand notes issued under act of July 17, 1861, $500,000,000 in 6 per cent. bonds, redeemable after five years, and payable twenty years from date, which may be exchanged for United States notes, and a temporary loan of $25,000,000 in United States notes for not less than thirty days, payable after ten days’ notice at 5 per cent. interest per annum.
March 17—Authorized an increase of TEMPORARY LOANS of $25,000,000, bearing interest at a rate not exceeding 5 per cent. per annum.
July 11—Authorized a further increase of TEMPORARY LOANS of $50,000,000, making the whole amount authorized $100,000,000.
March 1—Authorized an issue of CERTIFICATES OF INDEBTEDNESS, payable one year from date, in settlement of audited claims against the Government. Interest 6 per cent. per annum, payable in gold on those issued prior to March 4, 1863, and in lawful currency on those issued on and after that date. Amount of issue not specified.
1862, July 11—Authorized an additional issue of $150,000,000 legal tender NOTES, $35,000,000 of which might be in denominations less than five dollars. Fifty million dollars of this issue to be reserved to pay temporary loans promptly in case of emergency.
July 17—Authorized an issue of NOTES of the fractional part of one dollar, receivable in payment of all dues, except customs, less than five dollars. Amount of issue not specified.
1863, January 17—Authorized the issue of $100,000,000 in United States NOTES for the immediate payment of the army and navy; such notes to be a part of the amount provided for in any bill that may hereafter be passed by this Congress. The amount in this resolution is included in act of March 3, 1863.
March 3—Authorized a LOAN of $300,000,000 for this and $600,000,000 for next fiscal year, for which could be issued bonds running not less than ten nor more than forty years, principal and interest payable in coin, bearing interest at a rate not exceeding 6 per cent. per annum, payable on bonds not exceeding $100, annually, and on all others semi-annually. And Treasury notes (to the amount of $400,000,000) not exceeding three years to run, with interest not over 6 per cent. per annum, principal and interest payable in lawful money, which may be made a legal tender for their face value, excluding interest, or convertible into United States notes. And a further issue of $150,000,000 in United States NOTES for the purpose of converting the Treasury notes which may be issued under this act, and for no other purpose. And a further issue, if necessary, for the payment of the army and navy, and other creditors of the Government, of $150,000,000 in United States NOTES, which amount includes the $100,000,000 authorized by the joint resolution of Congress, January 17, 1863. The whole amount of bonds, treasury notes, and United States notes issued under this act not to exceed the sum of $900,000,000.
March 3—Authorized to issue not exceeding $50,000,000 in FRACTIONAL CURRENCY, (in lieu of postage or other stamps,) exchangeable for United States notes in sums not less than three dollars, and receivable for any dues to the United States less than five dollars, except duties on imports. The whole amount issued, including postage and other stamps issued as currency, not to exceed $50,000,000. Authority was given to prepare it in the Treasury Department, under the supervision of the Secretary.
1864, March 3—Authorized, in lieu of so much of the loan of March 3, 1863, a LOAN of $200,000,000 for the current fiscal year, for which may be issued bonds redeemable after five and within forty years, principal and interest payable in coin, bearing interest at a rate not exceeding 6 per cent. per annum, payable annually on bonds not over $100, and on all others semi-annually. These bonds to be exempt from taxation by or under State or municipal authority.
1864, June 30—Authorized a LOAN of $400,000,000, for which may be issued bonds, redeemable after five nor more than thirty years, or if deemed expedient, made payable at any period not more than forty years from date—interest not exceeding six per cent. semi-annually, in coin.
Pending the loan bill of June 22, 1862, before the House in Committee of the Whole, and the question being on the first section, authorizing a loan of $400,000,000, closing with this clause:
And all bonds, Treasury notes, and other obligations of the United States shall be exempt from taxation by or under state or municipal authority.
There was a sharp political controversy on this question, but the House finally agreed to it by 77 to 71. Party lines were not then distinctly drawn on financial issues.
INTERNAL TAXES.
The system of internal revenue taxes imposed during the war did not evenly divide parties until near its close, when Democrats were generally arrayed against these taxes. They cannot, from the record, be correctly classed as political issues, yet their adoption and the feelings since engendered by them, makes a brief summary of the record essential.