The following clause of the bill was agreed to, viz: "On all other articles, five per cent. on their value at the time and place of importation, except tin in pigs, tin plates, lead, old pewter, brass, iron or brass wire, copper in plates, wool, dying woods and dying drugs, (other than indigo,) raw hides, beaver, and all other furs, and deer skins."
Mr. Fitzsimons proposed a drawback of six cents per gallon on all rum distilled in the United States, exported without the limits of the same.
Mr. Madison asked if the quantity of rum so exported was very considerable? He believed it was not; and he would not, for the sake of encouraging that branch of trade, open a door by which frauds on the revenue could be committed equal to the whole duty collected.
Mr. Fitzsimons could not say what quantity of rum was exported in that way; but he feared, unless a drawback was allowed, it would be a great injury to the manufacture. At the time the duty of six cents on molasses was laid, he thought it was understood, the committee would allow a drawback on the rum exported. There seems to be an apprehension that the system of drawbacks will operate to the disadvantage of the revenue; but he believed a mode could be devised to prevent frauds, in this case, fully as effectually as on the importation. If this was not done, it would be time enough for gentlemen to oppose it; they would have this opportunity, because a bill, regulating the manner of collection, he presumed, would pass at the same time with the one for levying the duties. If drawbacks were not allowed, it would be a very considerable restraint on commerce, particularly on the India trade, which he believed was likely to be considerably extended. He was sorry the gentlemen from Massachusetts were not there in their places,[20] to give information to the committee respecting the quantity exported from that State; from Pennsylvania the quantity was but small.
Mr. Fitzsimons contended for drawbacks generally, but on this article it was particular injustice to omit it. The manufacture of rum was of considerable importance in the Eastern States, but it would not be able to stand a successful competition with West India rum in foreign countries, while loaded with a duty of six cents per gallon. The tax on molasses was that sum, and he looked upon it to be the same thing as if it had been paid on the rum at distillation; one gallon of the former yielding but one of the latter.
Mr. Madison thought there were very few cases in which drawbacks ought to be allowed, perhaps none but what related to the East India trade. The small proportion of distilled rum exported did not justify so great a risk; but of the small proportion which went abroad, the greatest part went to the coast of Africa. He feared this trade was inconsistent with the good of mankind, and ought to be reprobated instead of encouraged.
Mr. Bland said the committee had spent several days in encouraging manufactures, by selecting articles for revenue, and were now extending their views to the encouragement of commerce. He thought there was some impropriety in combining the clause proposed in this part of the bill, and even doubted if it was in order; therefore would vote against it.
The question was put on the motion for a drawback on country rum, and lost.
Mr. Fitzsimons had another clause upon the same subject, only on more general principles; he hoped gentlemen would consider well before they doomed it to share the fate of the former. It was to this purpose: that all the duties paid, or secured to be paid, upon goods imported, shall be returned or discharged upon such of the said goods, as shall within —— months be exported to any country without the limits of the United States, except so much as shall be necessary to defray the expense that may have accrued by the entry and the safe keeping thereof. The subjects of duties and drawbacks are so connected by their nature, that he did not see how they were to be separated. Gentlemen did not imagine that what had been done tended to favor commerce; it certainly did not. Every impost which is paid is a disadvantage to the person concerned in trade, and nothing but necessity could induce a submission to it. The interest of the landholder is undoubtedly blended with the commercial interest; if the latter receive an injury, the former will have to sustain his proportion of it; if drawbacks are not allowed, the operations of trade will be considerably shackled; merchants will be obliged, in the first instance, to send their cargoes to the place of consumption, and lose the advantage of a circuitous freight, which alone is a profit of no small magnitude.
Mr. Hartley expressed his sorrow for the last decision of the committee; he wished the question had not been put in the absence of the gentlemen from Massachusetts, who were on a business in some degree of a public nature. The present motion was only just brought in; he submitted, therefore, to the committee, if it were not best to pass it over for the present, in order to give time for consideration.