1784 had required that senators should be apportioned among the various senatorial districts according to "the proportion of public taxes paid by the said districts." The Constitution of 1792 changed this to "the proportion of direct taxes." These public, or direct, taxes were in both instances the State taxes upon polls and estates.2 This is, incidentally, an excellent illustration of the manner in which the discussions over the direct tax clause of the constitution served to familiarize Americans with the words. direct and indirect taxes.

None of the expressions just quoted imply that all the taxes levied by the States were direct. Most of them were merely to the effect that State taxes were largely, or even mainly, direct, or that Congress could readily base federal direct taxation upon the methods employed by the States. As a matter of fact, all of the States, prior to 1789, levied customs duties, and many employed the excise, both of which were considered to be forms of indirect taxation. Even after excise and customs duties were given up to the federal government, the States still employed some taxes that would be considered indirect. This will be shown presently.3 But the quotations do justify the belief that the men who framed the constitution identified direct taxes with certain leading forms of taxation that were customary in the States. A brief survey of colonial and state taxation in the eighteenth century will show what the principal taxes were.

In the New England colonies chief reliance had always been placed on taxes imposed upon polls and estates. In this direction, Massachusetts and Connecticut set the example for the other colonies.* Rhode Island and New Hampshire seem to have adopted the system of taxation customary in Massachusetts,5 1 Poore, Federal and State Constitutions, ii, 1284, 1299.

* Belknap, History of New Hampshire, iii, 282 (Philadelphia and Boston, 17841792).

3 For the moment it will suffice to call attention to the provisions of the South Carolina constitution, as amended in 1808. This amendment referred to "all taxes raised by the legislature, whether direct or indirect." Poore, Federal and State Constitutions, ii, 1634.

• Douglas, Financial History of Massachusetts, 17-31 (New York, 1892); Jones, Taxation in Connecticut, 8 (Baltimore, 1896).

5 Sumner, Financier and Finances of the Revolution, i, 13, 17 (New York, 1891); Belknap, History of New Hampshire, iii, 282; Bullock, Essays on the Monetary History of the United States, 260–261.

while Vermont copied the laws of Connecticut.1

3

Customs and

excise duties were introduced, sooner or later, to supplement the other branches of revenue, but they never became a principal source of income in these colonies.2 Attempts were made, also, to supplement the taxation of estates with taxes upon faculties or professions, but these imposts were always of the slightest possible importance. In all these colonies the taxation of property extended mainly to real estate and farm stock, for it was never possible for assessors to reach any considerable amount of intangible personal property. Complaints upon this subject were heard from the farmers even at the earliest period of colonial history. Polls, real estate, and cattle were the principal objects of taxation.

In New York, indirect taxes were the chief source of revenue under Dutch rule, but the English subsequently developed a property tax that finally became the principal item in the budget of the colony. Yet customs and excise taxes retained a place of greater importance than they seem to have secured in New England. The poll tax is found in New York under the rule of the Dutch. In New Jersey, a tax on land, cattle, and slaves existed in the seventeenth century; and a system of taxes upon polls and estates was soon developed. Some revenue was secured in this colony from impost duties, and an excise was imposed upon liquors. In Pennsylvania, an act of 1693 provided for a tax on real and personal property, and this was accompanied by a poll tax upon freemen who were worth less than one hundred pounds. Duties upon imports were also established at an early date. In 1766, Franklin described the revenue system of this colony when he was examined before the House

1 Wood, Taxation in Vermont, 32, 33 (New York, 1894).

Douglas, Financial History of Massachusetts, 32, 78-95; Jones, Taxation in Connecticut, 53.

3 Douglas, Financial History of Massachusetts, 31-32; Jones, Taxation in Connecticut, 8; Wood, Taxation in Vermont, 38.

• See Schwab, History of the New York Property Tax (Baltimore, 1890).

5 Raum, History of New Jersey, i, 299 (Philadelphia, 1877); Mulford, History of New Jersey, 193, 230, 231, 351 (Camden, 1848).

Mulford, History of New Jersey, 320.

'Shepherd, History of Proprietary Government in Pennsylvania, 438, 439 (New York, 1896).

of Commons.1 He stated that Pennsylvania imposed taxes upon polls and estates, upon offices and professions, and upon negroes imported, besides excise taxes and some other duties. Thus these middle colonies had poll and property taxes, beside somewhat more fruitful impost and excise duties than were enjoyed in New England; but there is no reason for supposing that personal property was taxed with more success here than elsewhere. For New York, Professor Schwab has shown that personalty largely escaped the assessor. For New Jersey, similar facts will be presented in a following paragraph. Real estate and farm stock bore the real burden of taxation, although some revenue was secured from poll taxes, and from excise and customs duties.

The history of tax systems in the southern settlements, among which Maryland must be included, offers many points of contrast to the experience of New England and the middle colonies. Maryland and Virginia had lucrative sources of income in the export duties on tobacco, which the unique situation of these colonies made it possible to impose upon this great staple product. These duties were more important than taxes upon imports and tonnage, from which, however, some revenue was secured.2 But the establishment of any taxes upon property, especially upon land, was rendered extremely difficult on account of the opposition of the large landed proprietors who so long dominated the affairs of these colonies.3 In Maryland prior to the Revolution attempts to tax property were not permanently successful, and the poll tax was practically the only direct tax employed. In 1755, military expenses compelled Virginia to impose the first land tax that had been known for a century. Even then its retention was difficult, and in 1769 the poll tax yielded four times as much as the tax upon land. In both States the exigencies

1 Bigelow, Works of Franklin, iii, 409.

Ripley, Financial History of Virginia, 67-68, 104 (New York, 1893); Scharf, History of Maryland, i, 488, ii, 121-123 (Baltimore, 1879).

3 Seligman, Essays in Taxation, 19 (New York, 1895).

'McMahon, History of Maryland, 308 (Baltimore, 1831); Scharf, History of Maryland, i, 488, 500; Ely, Taxation in American States and Cities, 112 (New York, 1888).

Ripley, Financial History of Virginia, 38-41, 45.

that arose during the Revolution necessitated the adoption of taxes upon property. But in these, the bulk of the revenue was secured from real estate. The taxes upon personalty were confined to a few specific objects, and farm stock was the only article of any importance. Evidence upon this point will be offered presently.

In South Carolina, considerable revenue was secured from import and a few export duties; but North Carolina, which secured its foreign supplies mainly from ports in the adjoining colonies, drew only small sums from duties upon imported spirits.1 South Carolina at an early date taxed polls, lands, some other forms of property, and professions;2 but here, as elsewhere, land bore the principal burdens, except in so far as it was eased by receipts from poll taxes and customs duties. In North Carolina, before the Revolution, the poll tax was practically the only form of direct taxation. During the struggle for independence, both of these States experienced great difficulty in the establishment of adequate revenue systems.* In North Carolina, desperate attempts seem to have been made to provide for the expenses of the war by means of the poll taxes; but, in the end, taxes were imposed upon lands, slaves, and horses.

It appears, therefore, that, in all the colonies, the principal taxes were those imposed upon polls and upon property, except in a few cases where indirect taxes proved sufficiently productive to lighten the weight of direct taxation. The poll tax was, until the Revolution, the chief form of taxation employed in some colonies; and it was an important source of revenue in all. Whenever property taxes were laid, real estate had to bear almost the entire burden, farm stock being the only important item of personal property that assessors could reach with success.

1 Whitney, Government of the Colony of South Carolina, 100-101 (Baltimore, 1895); Williamson, History of North Carolina, ii, 114, 164 (Philadelphia, 1812); Elliot, Debates, iv, 156, 157, V, 41; Ford, Essays on the Constitution, 404; American Museum, iii, 552.

2 Whitney, Government of the Colony of South Carolina, 99-100.

3 Basset, Constitutional Beginnings of North Carolina, 72 (Baltimore, 1894); Williamson, History of North Carolina, 114, 164; Bullock, Essays on the Monetary History of the United States, 178, 184.

4 Sumner, Financier and Finances of the Revolution, i, 24.

In 1789, the States gave up their import duties to the federal government, and it was recognized that no State could thenceforth impose successfully excise duties upon home manufactures. These facts made the familiar taxes upon polls and estates more important than ever before. In Wolcott's report upon direct taxation, prepared for Congress in 1796, we are fortunate in having a detailed account of the revenue systems of the States at that time.1 From this, it appears that nearly all the States levied uniform poll taxes, or capitation taxes upon slaves. All of the States taxed land, but according to different systems. Taxes were imposed upon personal property, but in some States only a few specified articles were reached, while others sought to include nearly all forms of personalty. But in all cases the result was practically the same: taxes upon real estate, poll taxes, or capitation taxes upon negroes, accounted for nearly all of the revenue collected.

The report presents statistics of the property assessed or the taxes collected in the majority of the States. The results are sufficiently striking to warrant a detailed presentation. In New Hampshire, the total inventory, including doomages, amounted to £40,521. Of this sum, polls and real property were charged with £27,056. Cattle were charged with £12,882, while all other personalty was rated at £578. Thus polls and real property paid from 65 to 70 per cent. of every tax, cattle paid about 30 per cent., and other personal property paid only I per cent. In Massachusetts, polls were taxed, but the amount is not stated. Of the property taxed, real estate represented over 83 per cent. of the total, cattle about 8 per cent., and all other personalty less than 9 per cent. Excluding poll taxes, real property and cattle must have accounted for 90 per cent. of every tax levy. In Rhode Island, out of every £1,000 levied, polls and real property paid £825; while personalty paid only £175, this sum representing of course chiefly farm stock. In Connecticut, polls and lands accounted for 65 per cent. of the entire assessment, cattle for 29 per cent., other personalty for less than 6 per cent.

For New York and Pennsylvania, statistics are not given,

1 State Papers, Finance, i, 418-465. Summarized in Ely, Taxation in American States and Cities, 116-130.