No. 293.
Mr. Adee
to Mr. Marts.
Madrid, April 29, 1877. (Received May 17.)
Sir: The minister of hacienda, Mr. José García Barzanallana, presented to the Cortes on Friday last the estimates of receipts and expenditures for the ensuing fiscal year, beginning on the 1st of next July. It is a ponderous document, filling some nine closely-printed pages of the official Gaceta of yesterday; and as its length and general want of interest, so far as we are concerned, preclude its being translated by me, I content myself with sending to you two copies of the paper containing the budget, endeavoring at the same time to give you an outline of its main points, some of which closely affect foreign commerce with Spain.
The expenditures are estimated at 735,775,184 pesetas (say, $142,004,-610.51); and the receipts from all sources, taxes, imposts, revenues, and duties, at a total of 735,868,647 pesetas (say, $142,022,648.87), leaving a margin for deficiencies of only 93,463 pesetas ($18,038.36), which, as the deficiency of estimated revenue for the current year will probably reach 134,000,000 pesetas, can hardly be called an excessive allowance.
Besides these fixed revenues provision is made for the sale of state property to the amount of 33,943,337 pesetas, applying that sum to the payment of interest and principal of treasury-bonds.
The impost on real estate, cultivation, and cattle-raising is fixed at 165,000,000 pesetas, and may not exceed 21 per cent, of the net profits of the same in any case.
The extraordinary war-tax of one-ninth part of the industrial and commercial contribution is suppressed, and in its place is established a transitory surcharge of 15 per cent, of the respective industrial and commercial quotas according to the existing tariff (article 5).
I translate article 10:
The import of cédulas personates shall be collected at the dwelling-houses of the parties during the first quarter of the fiscal year, after previous formation of lists of all the persons obliged to provide themselves with cédulas, among whom shall be counted foreigners domiciled in the kingdom, who, by the fact of satisfying this impost, shall remain exempt from the payment of the fee for inscription in the municipal registers.
I invite your attention in this relation to the corresponding paragraphs in Mr. García Barzanallana’s explanatory preamble as marked in red on page 280 of the accompanying Gaceta. This whole question of the liability of foreigners to the tax for cédulas personales has for some time been a cause of dispute between the Governments of Great Britain, France, Germany, and Italy, and that of Spain. This new disposition making their acquisition obligatory on all foreigners, instead of only on those who were required to present the cédula in order to legitimize the performance of certain specified civil and legal acts, as was the case in the last budget, will doubtless give rise to renewed discussion in this respect.
The carriage-tax is repealed as a government tax (article 14).
A tax of 8.80 pesetas per hundred kilograms is established on sugars produced in Spain (article 15). (See the marked section of the preamble on page 281 of the Gaceta.)
I translate also articles 18,19, 23, and 24 because of their importance as affecting the foreign trade of Spain, and in view of the acrid international discussions to which they are likely to give occasion:
[Page 506]Art. 18. There is established an extraordinary and transitory impost upon the values of the articles of foreign commerce hereinafter expressed, and to the amounts which are also determined:
One per cent, on the importation of merchandise whose customs duties are from 3 to 9 per cent., inclusive.
Four per cent, of the value on the importation of tobacco for private parties, and on the merchandise whose customs duties are from 10 per cent. upwards, with exception of textile goods and the articles subject to the transitory impost on articles of consumption.
Four per cent. of the value of wines of Jerez and Puerto Santa María exported to foreign parts and to the Spanish provinces of Ultramar.
Two per cent. of the value of other wines not of Jerez and Puerto Santa María, and of minerals and metals which may be exported to the same destinations.
For the liquidation of this impost shall be taken as a basis the official values annually fixed by the consulative junta of tariffs and valuations, in conformity with the instruction of the 15th of last January.
The administration of the impost shall be at the charge of the customs, and its assessment and collection shall be made simultaneously with the regular tariff duties.
Art. 19. The government will reform the values and classifications of the existing customs tariff, and will convert into fixed duties those which at the present time are established ad valorem, in fulfillment of what is ordered in the last paragraphs of the seventh and eighth bases of the customs tariff-law of July 1, 1869.
* * * * * * *
Art. 23. The reductions of duties which may result from the rectification of the customs tariffs shall only be applied to the products and exports of the nations which concede to Spain the treatment of the most favored nation.
Art. 24. The government is empowered to impose an additional charge on the duties of importation and on navigation-dues for the products, vessels, and exports of the countries which may in any way especially prejudice our products and our commerce.
In his preamble to the budget, Mr. García Barzanallana gives the reasons which have led to the inclusion of these provisions, and rather broadly indicates several of the countries to which the proposed law is to be made applicable. He says:
Lastly, treating of imposts on imports and exports and of the revision of the values and classifications of the customs tariff, there must be borne in mind the differential duties, the prohibitions and gravamens which our commerce suffers in several foreign marts, wherein it is denied the benefits conferred upon the like trade of other nations, and the best way to try to put an end to such a prejudicial and unbearable state of things; thus giving to the country the satisfaction that, although on the one hand necessary and dolorous tributes are imposed upon it, yet on the other we sally forth in defense of the national productions and seek to better their standing in foreign nations.
Several powers, especially those with which we maintain the largest commercial relations, without appreciating the benefits of the last reforms of our tariff, without responding to them, and unmindful that in Spain there is no customs distinction whatever to their prejudice, have tenaciously objected to favor our productions with the benefits of conventions or special tariffs, giving no heed again and again to the just and well-founded complaints of the Spanish Government.
Some countries have celebrated conventions in which our wines are punished with differential duties, founded on the artifice of the alcoholic scale; another very important country has two tariffs of duties a general one with many prohibitions, high duties, and special surcharges applicable almost exceptionally in Europe to Spain, and another conventional one, with very low duties as compared with the former, and without any commercial prohibition or special surcharge. There is a republic in America which not long ago declared French wines free of duty, and increased the duties on those of Spain. There is therefore a real necessity for applying the practical means of procuring the concession to us, not of exclusive privileges, but of the benefits which the powers in question grant to many other powers. These means are none other than the application of the reduction of duties which may result from the revision of the tariff, only to those nations which by conventions concede to the products and commerce of Spain the treatment which they accord to those of the most favored nation; and likewise to those other powers which without treaty apply their customs legislation to Spain in complete equality with the conditions under which they apply it to all other countries, and without any concrete distinction established against any of our products, in order to favor the like products of any other country or countries. In the event of this not being sufficient, the government should be empowered to apply in addition, within a prudent time, an extra charge upon import duties and navigation dues, for the products, vessels, and exports of the countries mentioned which may in any way especially prejudice our productions and commerce.
Besides the foregoing extract, I call your attention to the entire section of the preamble relating to customs, which you will find on pages 281 and 282 of the Gaceta.
I do not see that the proposed law of the minister of finance especially affects us. The extra charges on imports and exports bear on all foreign commerce alike, and, so far as I know, we have no discriminating duties against Spain which are not merely reciprocal, if not retaliatory. It is therefore to be presumed that it is intended to give the United States the benefit of any reduction of duties, as being one of those nations treating the commerce of Spain in general on a level with that of other nations. I shall, however, investigate this point in conversation with the minister of state.
It is easy to identify the countries particularly alluded to by the minister of finance. England is the principal one employing “the artifice of the alcoholic scale,” for although we employ the same “artifice,” yet our higher limit of proof prevents the fuller grades of Andalusian wines from becoming dutiable as spirits. France is the country where a double tariff exists, an evil which the ardent diplomacy of Spain has for some years ineffectually endeavored to overcome. And the American republic which admits French wines free and doubly taxes those of Spain is Venezuela.
All these provisions of international operation will doubtless be keenly discussed in the Cortes, and may possibly be somewhat modified in deference to the representations of the foreign legations here before the budget becomes a law. I do not, however, anticipate any material change.
To return to the budget: Articles 25 to 35 are devoted to the regulation and readjustment of the various imposts on articles of consumption, which are now to be imposed and collected by the treasury, with the exception of that on salt. As for this indispensable article, no less than seven sections of the budget are devoted to arranging for an income of 18,500,000 pesetas thereon. Two imposts are established, one to be collected directly from the ayuntamientos, amounting to one peseta for each inhabitant, and the other, of 1,500,000 pesetas, to be distributed pro rata among the salt producers. To offset the first of these imposts, the ayuntamientos are given the monopoly of retail sales of salt, with power to farm out the same.
The revenue-stamp tax on sales of merchandise is suppressed, being merged in the increase of the industrial and commercial contribution (article 36). This change gives general satisfaction, the tax having been especially obnoxious to the people, besides yielding very meager results.
The war-stamp on letters circulating within Spanish territory is increased from 5 centimes to 15 centimes on each letter mailed (article 37).
The coinage of silver will continue to be at the charge of the state (to which the profits of the operation will of course accrue).
The floating debt of the treasury incurred in meeting the expenses estimated is to be limited to one-fourth part of the total sum for the fiscal year, except in case of foreign or civil war or serious disturbance of the public peace (article 41).
The remaining articles of the budget proper offer but little general interest.
A further bill introduced by Mr. García Barzanallana at the same time provides for the extinction of the probable deficit at the conclusion of the current fiscal year by means of the hypothecation of treasury bonds and the emission of fresh obligations, or of treasury notes, at 6 per cent, interest.
[Page 508]And finally, a third bill provides that the extinction of the 6 percent, debts, which was suspended by the decree-law of June 26, 1874, shall be resumed during the fiscal year of 1878–79, to the extent of 5,300,750 pesetas.
Taken as a whole, the financial measures now presented show little advance on their forerunners, but will probably, like them, be voted by the majority without essential change, and if, in debate, it should be represented that the present estimates but follow in the wake of former ones, making good the deficiencies of the last by fresh taxation, and loading down the industry, the productions, the exports, the very life of the country with renewed burdens, instead of aiming to foster the development of its resources and the increase of its material wealth, such arguments will, most likely, pass unheeded as due to the narrow factiousness of mere partisan opposition.
I have, &c.,