No. 338.
Mr. Foster to Mr. Evarts.

No. 858.]

Sir: In conformity with the legal requirements, before the adjournment of Congress the minister of finance submitted to the Chamber of Deputies the estimates of receipts and expenses of the federal government for the next fiscal year. From the minister’s report I have compiled the following tables:

estimated receipts.

Import duties at custom-house $10,561,007 62
Export duties—silver, gold, and orchilla 936,416 59
Tonnage dues 43,578 64
Introduction and consumption duties of federal district 1,109,920 00
Direct taxes, real estate, &c., federal district 525,150 00
Product of stamp-tax 1,800,000 00
Rent of mints 342,014 87
Post-office gross receipts 445,156 29
Lottery tax 269,408 66
Miscellaneous sources 269,802 38
Total receipts 16,303,455 05

estimated expenses.

Legislative power $979,862 00
The executive office 48,572 40
The judicial power 346,878 00
Department of foreign affairs 193,960 00
Department of government 2,628,819 50
Department of justice 1,236,592 20
Department of public works 3,642,380 00
Department of finance 5,595,840 39
Department of war 8,661,912 45
Total expenses 23,334,636 94

The foregoing shows an increase in the estimates of expenses over those of the current year of $1,585,000. It also shows that the total receipts will fall over seven millions of dollars short of the estimated expenditures, or that the government will only be able to pay about seventy per cent, of its current expenses. The minister, in view of this prospective [Page 771] embarrassment, calls the attention of Congress to the necessity of equalizing the receipts and expenses, which can only be done by reducing the expenses or increasing the receipts. He states that the first method, which appears to be the most simple, has, up to the present, been decided to be impracticable, as since 1867, when the republic was reestablished, continuous efforts have been made to reduce the expenses, and so far from being successful the estimates approved by Congress have each year, with few exceptions, amounted to a greater sum than those of the year preceding. It being regarded as impossible to decrease the expenses, the minister recommends as the best method of increasing the receipts, that additional stamp taxes be imposed. He recognizes that this method of taxation is unpopular, but in view of the great difficulties presented to the imposition of new taxes of any description, that of stamps appears to offer the fewest obstacles.

The stamp tax, which is already regarded as burdensome, only produces $1,800,000 at present, and it would seem impracticable to so enlarge its operations as to yield four times that sum.

It may be confidently anticipated, therefore, that, even if peace continues, there will be, during the next fiscal year, a large deficit in the federal treasury.

I am, &c.,