That a considerable portion of the money expended in the Provincial Government was raised by excise is evidenced from a report made by Governor John Penn June 26, 1775, which was an account of the several amounts of the excise tax collected for the years 1771, 72, 73 and 74, the total amount of which, after deducting the commissions to the Treasurer and collectors exceeded £28,000. Together with this report was another indorsed “State of the Bills of Credit struck on the Excise for several years, laid before the Governor with the bill for the support of Government & paymt of public debts.”
In the Act of 1722 a duty was levied on domestic and foreign spirits. At first, however, as to home-distilled spirits it was not executed, and, indeed, hardly any steps were taken for the purpose particularly in the older counties. But, during the Revolutionary War, the necessities of the State and a temporary unpopularity of distillation, owing to the immense amount of grain consumed, when the troops so much needed it as a food, rendered the collection of duties both necessary and practicable, and a considerable revenue was thereby obtained. Toward the end of the war the act was repealed.
In 1780 Congress resolved that an allowance of an additional sum should be made to the army, to compensate the troops for the depreciation in their pay. This was distributed among the several States for discharge. Pennsylvania made several appropriations for the purpose, but the revenues so applied turned out to be unproductive.
The depreciation fund was always favorably regarded, and upon an application of officers of the Pennsylvania Line, another effort was made, the revenue arising from the excise remaining uncollected was appropriated to this fund, and vigorous measures were taken for its collection.
Great changes, however, had taken place in the disposition of the people since the first imposition of these duties. The neighboring States were free from the burden, and in New Jersey, where a law had been passed for the purpose, its execution had been entirely prevented by a powerful combination. The Pennsylvania law, therefore, met with great opposition, especially west of the Allegheny Mountains and there is no evidence that the excise was ever paid in that section.
The excise law of Pennsylvania, after remaining for years a dead letter, was repealed, and the people were to submit to a similar law passed by the Congress of the new Federal Government March 3, 1791. This laid an excise of fourpence per gallon on all distilled spirits.
The members of Congress from Western Pennsylvania, Smilie, of Fayette, and Findley, of Westmoreland, stoutly opposed the passage of the law, and on their return among their constituents loudly and openly disapproved of it. Albert Gallatin, then residing in Fayette County, also opposed the law by all constitutional methods.
The majority of the people in the western counties of the State were of Scotch-Irish descent. They had heard of the exaction and oppression in the Old Country under the excise laws—that houses were entered by excise officers, the most private apartments examined, and confiscation and imprisonment followed if the smallest quantity of whisky was discovered not marked with the official brand. They also remembered the effective resistance to the Stamp Act, that those who forced the repeal of the odious law were the real factors in bringing about the independence of America. Holding these opinions, it is not to be wondered at that the more hot-headed resorted to threats of violence and precipitated the riotous proceedings known in Pennsylvania history as the Whisky Insurrection.