In 1790 Secretary of the Treasury Alexander Hamilton proposed an excise tax on distilled alcohol as a part of his financial program. Once the national government assumed the states' debts, Hamilton estimated a shortfall of more than $1 million for the additional interest, and about half of that total could be made up from a tax on distilled liquor. He believed that this tax would have three benefits: It would "discourage the excessive use of Spirits," "promote Agriculture," and "provide the support of the Public Credit." He sought to limit the potential for abuse by allowing country distillers to pay a flat annual fee on the capacity of their stills. In addition, he wanted to prevent indiscriminate searches and permit civil suits against false seizure to be tried by juries. Although the measure did not pass in 1790, it was reintroduced and became law in March 1791. Opponents viewed the tax as "odious, unequal, unpopular, and oppressive" and complained that it would extend the reach of the national government into everyone's home since, as one opponent explained, it would "let loose a swarm of harpies, who under the denominations of revenue officers, will range through the country, prying into every man's house and affairs."

Much of the opposition centered on the frontier and in the South, where it became virtually impossible to collect the tax. When officials made a more concerted effort to enforce the law in western Pennsylvania, the Whiskey Rebellion (1794) broke out. The tax remained in effect until after the election of 1800, when Thomas Jefferson and the Democratic-Republican Party repealed the measure. A new excise tax was passed in 1813 to help fund the War of 1812 (1812-15).

Bibliography:

1) William D. Barber, "'Among the Most Techy Articles of Civil Police': Federal Taxation and the Adoption of the Whiskey Excise," William and Mary Quarterly, 3rd ser. 25 (1968): 58-84

2) Thomas P. Slaughter, The Whiskey Rebellion: Frontier Epilogue to the American Revolution (New York: Oxford University Press, 1986)

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