OPERATIONS AT SPECIAL BONDED WAREHOUSES FOR THE STORAGE OF BRANDY MADE FROM GRAPES. After the act of Congress providing for the establishment of special bonded warehouses for the storage of brandy made from grapes, approved March 3, 1877, became a law, considerable time was required to prepare suitable regulations, printed forms, and engraved stamps, so that no spirits were deposited in any special bonded warehouse prior to June 30, 1877. The number of warehouses established under said act up to this date is six, as follows: The following statement shows the quantity, in taxable gallons, of grape brandy received into and withdrawn from these warehouses during the first quarter (ended September 30, 1877) of the present fiscal year, viz: Of the quantity in warehouse September 30, 1877, 12,991 gallons were in the following-named warehouses located in the first district of California, viz: No. 1, Bode & Danforth, 9,658 gallons; No. 2, Juan Bernard, 3,333 gallons; and 15,811 gallons were in the following-named warehouses in the fourth district of California, viz: No. 1, George Lichthardt, 15,403 gallons; No. 2, John F. Boyce, 408 gallons. In its practical operation, the act under consideration appears to have been thus far sufficient to secure the safety of the taxable articles stored in warehouse in accordance with its provisions. It is suggested, however, that if the act were so amended as to avoid the necessity of employing a storekeeper and a gauger at each of these warehouses by providing for the employment of the officer known to the law as a storekeeper and gauger, a considerable saving of expense to the govern ment would, in many cases, be effected. RECEIPTS FROM FERMENTED LIQUors. The following is a statement showing the receipts from each source relating to fermented liquors during the fiscal years ended June 30, 1876 The total collections from tobacco for the fiscal year ended June 30, 1877, were $41,106,546.92. In addition to the collections of the specific taxes from manufactured tobacco, snuff, and cigars in their various forms, there are included in the above total the collections from special taxes upon the manufacture and sale of tobacco, special taxes upon the raw or leaf tobacco, and from the sale of export stamps. Below is given a comparative statement of the receipts for the last fiscal year from the several sources above enumerated, with the recipts from the same sources for the fiscal year ended June 30, 1876; also, a statement of the increase or decrease of revenue from each of these sources during the last fiscal year: Manufactured tobacco, at 24 cents per pound Total for the year ended June 30, 1877..... Increase of collections on tobacco and snuff.... $27, 051, 968 37 1, 104 01 1,095, 695 52 28, 148, 767 90 26, 755, 780 20 1,392, 987 70 This exhibit shows an increase of more than five and one-fifth per centum over the collections for the previous fiscal year; and it is an increase over the collections for the fiscal year ended June 30, 1874— when the tax on manufactured tobacco, except snuff, was collected at twenty cents a pound-of $6,209.812.31, or an increase of more than twenty-eight and three-tenths per cent. The collections from snuff, taxed at the rate of 32 cents per pound, are about the same from year to year, being For the fiscal year ended June 30, 1874 $1,038, 445 92 1,067, 033 03 1,061, 467 64 1,095, 695 52 CIGARS AND CIGARETTES. Cigars taxed at $6 per thousand Cigars taxed at $5 per thousand Total collections for year ended June 30, 1877.. Decrease in collections from cigars and cigar- $10, 796, 477 52 2,981 68 260, 480 95 1,338 00 11, 061, 278 15 11, 105, 272 45 43, 994 30 These results, as compared with the previous fiscal year, show that, while there has been a decrease in collections from cigars of $170,328.08, or a fraction over one and one-half per cent., there has been an increase in collections from cigarettes of $126,333.78, or nearly ninety-three and a quarter per cent. The difference in the rate of tax between cigars at 86, and cigarettes at $1.75 per thousand, being in the ratio of three and three-sevenths to one, or nearly four times greater on the cigars than on the cigarettes, may, in part, account for the small decrease in the collections from these sources. OTHER COLLECTIONS. Export stamps, year ended June 30, 1877. Increase from sale of export stamps in 1877..... or nearly twenty per cent. of increase. Dealers in leaf tobacco, year ended June 30, 1877 .... Decrease in collections from dealers in leaf tobacco. Dealers in manufactured tobacco, year ended June 30, 1877.... Dealers in manufactured tobacco, year ended June 30, 1876.... Decrease in collections from dealers in manufac- Special taxes, manufacturers of tobacco and cigars, 1877. Increased collections, manufacturers of tobacco and Special taxes, peddlers of tobacco, year ended June 30, 1877... Special taxes, peddlers of tobacco, year ended June 30, 1876.... Decreased collections, peddlers of tobacco.... $8,009 60 6, 694 30 1,315 30 $97,422 49 112,962 96 15, 540 47 $1,595, 225 40 1,616, 318 85 21, 093 45 $163, 371 45 163, 244 65 126 80 $32, 471 93 35,066 50 2,594 57 From all the sources herein compared there is shown to be an increase in the sum total from collections of $1,311,207.01. This is the largest collection made during any one year from tobacco since the present internal revenue law has been in operation, or since July, 1862. PRODUCTION OF MANUFACTURED TOBACCO AND CIGARS. Taking the collections for the fiscal year as the basis for computing the production of tobacco, snuff, and cigars for the same period, the following results are obtained, which probably approximate closely to the actual production: Tobacco taxed at 24 cents a pound Tobacco taxed at 20 cents a pound, (old stock,). Total quantity tobacco removed for consumption Total tobacco and snuff for consumption Total production for year ended June 30, 1877 Increase of production during fiscal year 1877............. Pounds. 112,716, 535 5, 520 112, 722, 055 3, 424, 048 116, 146, 103 11, 299, 784 35, 262 127, 481, 149 119, 796, 727 7,684, 422 The number of cigars, cigarettes, &c., on which tax was collected during the fiscal year ended June 30, 1877, including the imported cigars which paid an internal revenue tax in addition to the import duty was as follows: Cigars, cheroots, &c., taxed at $6 per thousand.... Cigars, cheroots, &c., taxed at $5 per thousand, (old stock). Cigarettes taxed at $1.75 per thousand. Cigarettes taxed at $6.00 per thousand Total production for year ended June 30, 1877 Increase during year 1877, of... IMPORTED CIGARS. 1,799, 412, 920 596, 336 148, 846, 257 223, 000 1,916, 975 7, 396, 000 1, 958, 391, 488 1,908, 141, 057 50, 250, 431 The cigars imported during the fiscal year ended June 30, 1877, as given by the Bureau of Statistics : Allowing these cigars to weigh on an average thirteen and one-half pounds per thousand, will give the number of imported cigars withdrawn for consumption as 35,200,000, which is believed to be a close approximation to the number of imported cigars included in the entire number from which an internal revenue tax was collected during the fiscal year ended June 30, 1877, said tax, at $6 per thousand, being $211,200. There are three facts in connection with this subject which I deem especially worthy of note. The first is that the production of manufactured tobacco for the last fiscal year was greater than for any other fiscal year embraced within the reports of this office, with the single exception of the year ended June 30, 1875. The second fact is that a larger amount of money was collected from manufactured tobacco put upon the market for consumption than during any previous fiscal year. And the third fact is that a greater quantity of manufactured tobacco and more cigars and cigarettes were removed directly from the manufactories, for exportation to foreign countries, during the last year, than during any previ ous year of which an account has been kept by the Office of Internal Revenue. These results are believed to be largely due to those provisions of law which were intended to give to the government a general control over the movements of raw or leaf tobacco, regulating its sale, transfer, and shipment, and preventing its being sold for direct consumption without the payment of any tax, and in competition with manufactured and tax-paid tobacco, and in my opinion a continuance of those features of said law is necessary to maintain the present amount of receipts from said source. I have also to renew, in this connection, the recommendation which I had the honor to submit to the Secretary in my last annual report relative to the passage by Congress of the several amendments and additions to the law now in force, heretofore recommended by this office and incorporated into House bill No. 3926, reported by the honorable chairman of the Committee of Ways and Means during the last Congress. EXPORTATION OF MANUFACTURED TOBACCO AND SNUFF IN BOND. The subjoined table shows as "removed and unaccounted for" July 1, 1876, and July 1, 1877, the quantity, in pounds, of manufactured tobacco and snuff which had been removed for exportation in bond, and concerning which the proofs of landing at a foreign port had not been furnished prior to the dates named. |