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U.s. History

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U.s. History

Postby bellden » Sun Nov 27, 2016 10:58 pm

Why did the federal government decide to put a tax on whiskey? And why was it so important to frontiersmen?
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U.s. History

Postby Eldred » Mon Nov 28, 2016 1:15 am

Why did the federal government decide to put a tax on whiskey? And why was it so important to frontiersmen?
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U.s. History

Postby Teodor » Wed Nov 30, 2016 12:34 pm

Under the new government of President Washington, Secretary of Treasury Alexander Hamilton initiated an economic plan to help the country get off to a solid economic start.  There were four main points to this plan(sometimes called Hamilton's "Four Point" plan.)  These four points were:

1.  A revenue tariff on imported goods from other lands(to raise money for the new government.)

2.  A National Bank

3.  The federal assumption of state debts

4.  The Whiskey Tax.

The Whiskey tax was an excise tax on all whiskey distilled in America.  This whiskey had previously been distilled, sold, and never taxed--making for a pretty sweet deal for those farmers out west who gained ALL of the profit without having to pay any tax.  The federal government quickly realized they were missing out on a huge source for revenue with this untaxed whiskey.

It was generally the frontiersmen who raised the corn purchased by distillers to make their whiskey and it was other frontiersmen that actually MADE the alcohol.  Therefore this tax would now cut into their profits and force them to comply with federal law.

The Whiskey Rebellion of 1794 soon followed as these frontiersmen raised up arms against federal tax collectors, however once a national military force arrived on the scene, the rebellious frontiersmen quickly backed down and the Whiskey Rebellion was quieted down.

And there you have it...
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