Friday, January 20, 1797.
Direct Taxes.
The House then took up the consideration of the resolution reported yesterday by the Committee of the Whole, on the subject of further revenue.
Mr. Coit wished for a division of the question, viz: that the proposition for a tax on land and that for slaves should be put separately.
Mr. Swanwick called for the yeas and nays. They were agreed to be taken.
Mr. Nicholas thought the resolution should not be divided, but that the propositions for a tax on land and a tax on slaves should go together, as he should object to vote for the tax on land except that on slaves accompanied it. He thought the gentleman had better try the question, by moving to strike out what respected slaves.
Mr. Madison thought it would be best for the two propositions to go together; but if they did not, he did not think the embarrassments insuperable. If the question was divided, those who thought a tax on slaves necessary must vote for the first part; and if the second was rejected, there would not be wanting an opportunity of voting against the tax on land. It was necessary to observe, that it had been found expedient to associate these two taxes together, in order to do justice, and to conform to the established usage of a very large tract of country, who were entitled to some degree of attention, and to whom a tax on land, without a tax on slaves, would be very objectionable.
Mr. Coit said, he could not gratify the gentleman from Virginia by varying his motion, as it would not answer the purpose he had in view.
Mr. Nicholas supposed, if the motion was persisted in, he was at liberty to move to insert slaves in the first part of the resolution. The gentleman certainly knew his own views best; or he thought it was possible to have settled the business he proposed.
Mr. W. Smith saw no difficulty on the subject. Gentlemen would vote for the first part of the resolution, in hopes that the second would pass; but if it did not pass, they would have an opportunity of voting on the main question, and thereby defeat the whole.
Mr. Van Cortlandt would vote for both together, but not separately.
Mr. Gallatin inquired as to a point of order, whether, if the first part of the resolution was carried, and the second negatived, the question would not then be taken upon the resolution as amended?
The Speaker answered in the affirmative.
Mr. Williams said, it would save time if the question was taken upon the whole resolution together; for if several gentlemen voted against the first proposition, lest the last should not pass, the whole might in this way be defeated. He thought a vote might be safely taken upon the whole together, as no one would be bound by the vote in favor of the bill, if he should not approve of it. For his own part, he wished to see the plan, though he did not know that he should vote for it.
Mr. Nicholas supposed there was not the difficulty mentioned by the gentleman from New York. Gentlemen would not risk the whole by voting against the first part of the resolution; since, if the second was not carried, they could afterwards reject the whole.
The question was then put, that the House agree to the first resolution, viz:
"Resolved, That there ought to be appropriated, according to the last census, on the several States, the sum of——, to be raised by the following direct taxes, viz:
"A tax ad valorem, under proper regulations and exceptions, on all lands, with their improvements, including town lots, with the buildings thereon."
It was resolved in the affirmative—yeas 48, nays 39.
The second part of the resolution, relative to slaves, was about to be put, when
Mr. Gallatin said, before the question was taken on this division, he would just mention why this species of personal property was brought under view, whilst all other personal property was unnoticed.
It was very true, that stock upon a farm in the Northern and Eastern States paid nearly as great a proportion of the taxes of those States as the negroes did those of the Southern States, and therefore it might seem somewhat wrong to introduce negroes in the one case and not cattle in the other. The reason which induced the Committee of Ways and Means to adopt this mode was, that negroes are confined to certain spots of land in the Southern States, while horses and cattle extend nearly over a whole country. And a land tax, unaccompanied with a tax on slaves, would be very unpopular in those States, as it would throw too great a burden upon farmers who did not hold slaves, and fall too lightly upon those whose property chiefly consisted of slaves. There was this difference betwixt the two species of property: A farmer in the Northern or Eastern States would not think himself aggrieved by not paying a tax upon his farming stock; but a farmer in the Southern States would think himself aggrieved if his land was taxed, whilst the slaves of the slaveholder were not taxed. It was on this account that this species of property was introduced.
Mr. Murray was not struck with the observations of the gentleman last up, so as to say he would ultimately vote for this species of tax; at present, he should vote for a bill to be brought in; but unless he found the bill could reconcile the principle more, and do greater justice in the case than he at present conceived, he should then oppose it.
He said, he considered slaves in the Southern States as laborers, and unless gentlemen could show him where laborers were taxed, he should not think it right to vote for that part of the bill. He was decidedly in favor of a land tax, but against the other part of the question. Mr. M. said, he merely mentioned this that he might not hereafter be charged with inconsistency, in case he should vote against the bill. He repeated, unless provision be made for taxing labor in other parts of the United States, he must vote against this part of the bill if brought in, because the tax would operate very unequally.
Mr. Harper said, though he was entirely opposed to the tax proposed by the resolution, and should vote against the whole, yet he thought it right that a tax on slaves should be introduced with a tax on land; for, as this direct tax was to be raised by apportionment through the States, whether the Southern States paid on slaves, or the Northern States on land, made no difference in effect; each paid in its own way; one mode was more convenient for the Northern, another for the Southern, and another for the Eastern—no injury was done by this to any other State.
Mr. G. Jackson said, he was against all species of direct taxation, but particularly on this species; and, if a tax on land was carried, he should bring forward a resolution to lay a tax upon all property vested in public securities. He wished for the yeas and nays on this question.
The yeas and nays were agreed to be taken.
Mr. Nicholas wondered to hear the observation of his colleague. He should vote for the question, though he and his constituents would be affected by it; but, in the district which that gentleman represented, there were no slaves; and it was therefore his constituents' interest to have a tax on slaves, in order to lighten that on land.
Mr. G. Jackson said, it was not so much on account of the interest of himself or constituents that he opposed this tax, but he objected to it as a capitation tax.
Mr. Moore said, the situation of the Southern States had been truly stated. In the Western parts, there were few slaves. He said, in the representation to that House, the labor of the negroes had been considered as five to three, with respect to white persons; therefore, the ability of the State to pay was considered in the same proportion. His colleague from the mountains (Mr. G. Jackson) should consider that, if the holders of slaves were not to pay a portion of the tax imposed on the State of Virginia, it would fall very heavy upon his constituents, and those of his colleague, where few blacks were kept.
He hoped, therefore, it would pass.
Mr. Jeremiah Smith was aware that a tax on slaves would lighten the tax on land in the Southern States, and therefore he did not wonder at the Representatives from those States wishing it to take place; but, by so apportioning the tax, would not the landholders in the Southern States pay less than the landholders in parts of the Union where no slaves were kept? He believed they would. A person, for instance, in New Hampshire, holding the value of £1,000 in land, would pay a larger portion of the tax than a holder of land to the same extent in Virginia. He believed this would be unjust, and an objection to this mode of taxing the Southern States, as, though the tax would fall more equally on them, it would not be so with respect to other States.
Mr. Goodrich said, this tax was introduced into the system for the accommodation of that part of the Union where slaves were numerous.
A disposition to render the plan as acceptable, in every part of the country, as it could be made, consistently with the interests of the whole, ought to prevail. But, before a tax on slaves was adopted, its operation on the Union, and its effects, as it respected different districts, should be considered.
A direct tax ought to fall as equally as possible every where; that on land and houses, with their improvements, which had been agreed to, would be laid by a valuation seldom repeated—perhaps, once in ten or fifteen years. The expense of its assessment and collection would be nearly equal throughout the United States; but, with respect to a tax on slaves, there would be required frequent enumerations—at least an annual enumeration. This would be attended with considerable expense, to be defrayed, not by the particular districts, for whose benefit this species of tax was introduced, but by the United States.
There was another objection. A land tax was certain—it might, and undoubtedly would, be made a lien on the real estate on which it was laid. It would, be liable to little, if any, loss. Not so with a tax on slaves. Such a tax, he apprehended, would be uncertain, exposing the revenue to considerable defalcations. If a provision could not be made to place the loss on the districts where it happened, by retaxing them it would operate unequally. He imagined a retaxation for defalcation, if it could be made, would be considered as unjust, and create discontent among the individuals who were subjected to it; and if that could not be done, the deficiency must fall on the Union, and would produce uneasiness from its partial effects. He did not know how the detail would be arranged. He had been of the number who were desirous to see the collection-law, before they decided on the resolution before them, so as to have possessed the whole subject. At present, he saw so many difficulties from incorporating this species of tax into the plan, he could not assent to it.
Mr. Nicholas said, he did not understand the objections of the gentleman from New Hampshire, (Mr. J. Smith.) He did not see how he could produce an equal value in land in every part of the Union. The tax, he said, would be apportioned according to the number of persons, and not according to the number of acres in any State.
If the gentleman from Connecticut (Mr. Goodrich) would rely upon his information, he might be assured that an annual enumeration of slaves would not cost so much as an assessment of land made once in ten years. With respect to the tax being uncertain, he was totally mistaken. It was the most productive tax in the Southern States. If the tax was laid wholly upon land, it would be laid on a great part which would be unsaleable, and when a report came to be made of the collection, there would be found great deficiencies; but, with respect to slaves, there would be no failure, because they were a species of property which would always find a ready sale in the Southern market.
Mr. S. Smith said, he had heard much on that floor with respect to equality of taxation. It was impossible, he said, to make taxes fall exactly equal; they will fall, in some cases, heavier than in others. He would state a case. When a tax on carriages was under consideration, they found the gentlemen from Connecticut voting without scruple, because that State paid only two or three hundred dollars annually, when Maryland paid five thousand dollars a year to that duty. There was no equality in this; yet those gentlemen winked at the disproportion. He hoped they would do so in the present case.
Mr. Potter said, if this part of the resolution was agreed to, it was to apportion a tax on the personal property of the Southern States, which, no doubt, they would be glad of; and if gentlemen from those States could point out any way by which the personal property of other States could be come at, he would agree to the present proposition; but he believed this could not be done; and, if not, he saw no reason why the personal property of those States should be made to bear a part of the proposed burden, whilst personal property in other States was suffered to go free. It was a hard case, he said, that a man who possessed three or four hundred dollars in land, should be made to pay a portion of the direct tax, whilst men of affluence, who possessed many thousands in public securities, or loaned on interest, should pay nothing.
The Speaker reminded the House that the question was very much lost sight of; it was not whether a tax should be laid on carriages or personal property, but whether they would agree to the report of the Committee of the Whole, viz: "that a tax should be laid on slaves, with certain exceptions."
Mr. Henderson said, he should vote against this proposition, because it was a direct tax, as he should vote against every question of that kind, until every source of indirect taxation was exhausted; and he thought this was not the case at present.
Mr. Claiborne said, he thought, also, that direct taxes should not be resorted to until indirect sources were exhausted; but he believed, they were now exhausted, and that direct taxes were the only means left to them of raising money. As he lived in a country which was unfortunately cursed with negroes, he wished the present motion to pass, for the sake of making the tax bear, in some degree, equally in the Southern States; but if he thought with his colleague (Mr. Jackson) that a tax on slaves bore any affinity to a capitation tax, he should also oppose it; but he had no such idea.
Mr. Gallatin said, he would just notice what had fallen from the gentleman from Connecticut (Mr. Goodrich) which was the only thing like argument which had been used against the present proposition. As to what had been said about the quantum of tax falling on different States, or what had been said by the gentleman from Rhode Island (Mr. Potter) with respect to the personal property of the Eastern States, he did not see how it applied to the present question. If the proposed tax was certain, and the expense of collection would not be greater than would attend the collection of the tax in other States, he did not see any objection to it.
The gentleman from Connecticut had said, that the expense of an annual enumeration of slaves would be great, and that it would fall upon the United States. He would inform that gentleman and the House, that when no assessment took place, but merely an enumeration, it would be attended with no expense on the collection of the tax. The distinction which he made was, when a valuation and enumeration were both necessary, and when an enumeration alone was necessary. In the first instance, the value of the property was to be ascertained, and the tax laid accordingly; but where an enumeration was only wanted, (the tax per head, according to age, &c., having been settled,) no expense would be incurred.
Mr. G. said, he spoke from experience. In Pennsylvania there was a certain tax on personal property, the taking an account of which did not increase the expense. Every three years there was an assessment of personal property, amongst which was slaves; but the enumeration was managed in this way: the collector called twice upon persons—the first time he gave them notice to pay, and took an account of their property, which, consisting of few articles, and the value being already fixed, he could tell them at the time, the amount to be paid at his next call.
As to any degree of uncertainty apprehended from this tax, that might be removed by throwing the deficiency, if there should be any, upon the land. He thought, therefore, the objections which had been urged against this tax would be completely obviated.
Mr. Coit allowed, that nothing was more clear than that the manner in which the Southern States paid their apportionment of the proposed burden, could make no difference to the Northern and Eastern States; but the gentleman from Pennsylvania (Mr. Gallatin) allowed there was some weight in the objections, with respect to the assessment and collection of the tax.
If he understood that gentleman, he said that the making an enumeration of slaves would make no difference in the expense. He did not know how this could be. If two objects were to do, viz: to value and assess the land, and to enumerate and value the slave, it was new doctrine to him, if these two things would not cost more than if only one had been done; or, if this business would be done for nothing, it would be one of the first things the United States had had done upon those terms.
Upon the collection, there would also be an additional expense and a probability of loss; the more detail there was in the business, the greater liability to error and loss to the United States; and in proportion to this loss would these States pay less than others.
Mr. Hartley said, he should at present vote for the proposition; but should feel himself at liberty to vote differently on the bill, if he did not approve it. Difficulties arose in his mind as to the propriety of taxing personal property in one State and not in another, by which means a bounty seemed to be given on land in the Southern States to the amount of the difference of the taxes between the land in those States, and that in other States, upon which purchasers would naturally calculate. This difficulty might probably be removed from his mind; and, therefore, in order to give the whole of the business a fair chance, he should wish the resolutions to go back to the Committee of Ways and Means, to bring in a bill.
Mr. Page did suppose that gentlemen coming from States which were in the habit of collecting direct taxes, would have endeavored to accommodate the business to the situation and circumstances of different States, so as to make the system the most convenient to each. He did suppose that, whenever it should have been determined to enter upon direct taxation, that sums would have been apportioned to each State, and that they would have been left to themselves to have raised the money in the way which they thought most convenient. Insuperable objections, however, it seemed, had been found against this system, as appeared from the report of the Secretary of the Treasury; but it was unreasonable that the Northern States should complain that the Southern States would pay the tax with greater facility than them. They might, he said, as well complain against the richness of their soil, or the warmness of their climate.
With respect to the tax falling lighter on them than on other States, those who held slaves would find it lighter, but those who had none, would not. But he thought it extraordinary that, whilst they were upbraided with holding a species of property peculiar to their country, they should also be upbraided with wishing to pay a duty upon that property.
Mr. P. said, he did not see what difference it could make to other States, that they raised a part of the tax required of them from slaves. The Secretary of the Treasury had recommended this mode, the Committee of Ways and Means had reported accordingly; and they were ready to pay a tax for their slaves, in addition to the expense they were at for them already; for, it should be recollected, persons holding slaves, contribute largely to the duties collected from imposts, by the purchase of flannels and cloth, rum, molasses, &c., necessary for their food and clothing.
If a person living in a State where slavery did not exist, paid something more for his land, the difference was certainly not equal to the satisfaction he must enjoy in reflecting, that his State was free from that evil. His land, on that account, would be worth three times as much as land of the same quality in the Southern States. Why, then, do gentlemen complain? The Southern States themselves might have objected to this tax; they might have doubted the constitutionality of it; indeed, he did doubt it, but he had agreed to it; and he believed there was no better way of making the tax go down in those States, than by the present measure.
For his own part, Mr. P. said, he wished he lived where there was no slavery; and if he could find a climate he liked as well, he would change his situation on that account.
Mr. Brent said, it was a very extraordinary thing that gentlemen who represented States where there were no slaves, should oppose a tax on that species of property, and that the Southern States where slavery existed, should be advocating that tax.
By the report of the Secretary of the Treasury, there appeared a deficiency of revenue, and in order to supply that deficiency, they had determined to have recourse to direct taxation; and, after the amount which each State ought to furnish, had been ascertained, he thought it should have been left to the different States to have raised the money from such funds as they judged best, provided they had been secure. This, he thought, would only have been liberal and proper. It had, however, been determined otherwise; but, from a knowledge that, by introducing land and slaves together, as objects of taxation, the tax would be more equally levied in the Southern States, if that plan had been adopted. And, surely, he said, it could have given no satisfaction to any other State, that, by laying a tax on land only, it should have operated in a very oppressive manner in some parts of the Southern States, and scarcely have been felt at all in other parts of those States; and yet, this would appear to be the opinion of the gentleman from New Hampshire; for, he said, if this law passed, a person possessing landed property in New Hampshire, of the value of £1,000, would pay more than a landholder to that amount in the Southern States. And was this, he asked, a subject of regret? If the State of Virginia paid the amount required of her in a manner which bore most equally upon the whole of her citizens, ought that to displease the citizens of other States? He thought not. He was of opinion, that it would be a desirable thing that the tax should be found to fall equally on the citizens of every State.
Another objection, produced by the gentleman from Connecticut (Mr. Goodrich) was that a tax on this species of property would not be so secure as a tax on land. If that gentleman had been acquainted with the situation of the Southern States, he would have known that slaves formed the most certain fund of those States; for, whilst their wide and extensive waste lands would not command any price, slaves were always ready sale. Hence it arose, that the States were not able to raise a tax on land, whilst a tax on slaves had never failed to be productive.
With respect to the inconvenience or expense attending a tax on slaves, in Virginia, he said, no expense would be necessary; because it was the custom of that State to take annually, a list of their slaves, which was regularly recorded in the archives of the State. If gentlemen were, therefore, so economical that they would not expend a few of the public pence to get a list of this property, let them recur to the document he had mentioned, which might be done without expense.
To those who know the situation of the Southern States, the remarks made by the gentleman from Pennsylvania (Mr. Gallatin) must have been irresistibly impressive. Almost the whole of the lower part of the country possessed property of this kind, whilst the upper parts had scarcely any. If a tax was, therefore, imposed upon land only, the upper part of the country would be extremely aggravated, and would murmur, and they would murmur with justice.
Gentlemen from the Eastern States called upon the Representatives of the Southern States to point out a mode by which they might come at the personal property of their States. But, he would ask them, if, independent of land with its improvements, they possessed any other species of property which could not be eluded? He believed they could not point it out; why, then, call upon gentlemen from the Southern States to do, what they, who certainly knew best their own resources, were unable to do?
The gentlemen from the Southern States, he said, had discovered those objects which they thought best able to bear the burden; and if the Representatives of the other States were not satisfied with the tax on land, let them come forward and say what other property they have equally secure, upon which a tax may be laid.
It was a phenomenon, he would again say, that the Representatives of States where slavery existed, should be contending for a tax upon slaves, and that members from States where slavery was not tolerated, were opposing it. He could not help believing that the real object of gentlemen had not been avowed. It was something hidden and unseen.[8]
Mr. Kittera said, that the opposers of this part of the resolution were the opposers of a direct tax altogether. It was observable that those upon whom the tax would fall, did not complain. It was extraordinary that the complaints should come from another quarter. As to the objections of his colleague (Mr. Hartley) that part of the tax being laid on slaves in the Southern States, would affect the value of land, it would make no difference whether the tax was on land or slaves, as it affected land, its operation would be the same. It was therefore no solid objection against the resolution.
On the question, that the House do agree to the last part of the said resolution, in the words following, to wit: "A tax on slaves, with certain exceptions;" it was resolved in the affirmative—yeas 68, nays 23, as follows:
Yeas.—Fisher Ames, Abraham Baldwin, Thomas Blount, Theophilus Bradbury, Richard Brent, Daniel Buck, Samuel J. Cabell, Gabriel Christie, Thomas Claiborne, Isaac Coles, William Cooper, William Craik, James Davenport, George Dent, George Ege, William Findlay, Abiel Foster, Jesse Franklin, Albert Gallatin, James Gillespie, Nicholas Gilman, Henry Glenn, Christopher Greenup, Andrew Gregg, William B. Grove, Wade Hampton, George Hancock, Robert Goodloe Harper, Carter B. Harrison, Thomas Hartley, John Hathorn, Jonathan N. Havens, William Hindman, James Holland, Andrew Jackson, John Wilkes Kittera, Matthew Locke, Samuel Lyman, Samuel Maclay, Nathaniel Macon, James Madison, John Milledge, Andrew Moore, Frederick A. Muhlenberg, William Vans Murray, Anthony New, John Nicholas, Alexander D. Orr, John Page, Josiah Parker, John Patton, Francis Preston, Robert Rutherford, Samuel Sewall, Samuel Sitgreaves, Israel Smith, Isaac Smith, Samuel Smith, William Smith, Richard Sprigg, Jr., William Strudwick, John Swanwick, John E. Van Allen, Philip Van Cortlandt, Abraham Venable, Peleg Wadsworth, John Williams, and Richard Winn.
Nays.—Nathan Bryan, Dempsey Burges, Joshua Coit, Samuel W. Dana, Henry Dearborn, Dwight Foster, Nathaniel Freeman, Jr., Chauncey Goodrich, Roger Griswold, Thomas Henderson, George Jackson, William Lyman, Francis Malbone, Elisha R. Potter, John Read, John S. Sherburne, Jeremiah Smith, Nathaniel Smith, Zephaniah Swift, George Thatcher, Richard Thomas, Mark Thompson, and Joseph B. Varnum.
And then the main question being taken, that the House do agree to the resolution, as reported by the Committee of the whole House, it was resolved in the affirmative—yeas 49, nays 39.
Ordered, That the Committee of Ways and Means do prepare and bring in a bill or bills, pursuant to the said resolution.