Article 1, Section 9, Clause 5
Records of the Federal Convention
[1:286; Madison, 18 June]
Mr Hamilton: . . . Whence then is the national revenue to be drawn? from Commerce, even from exports which notwithstanding the common opinion are fit objects of moderate taxation, from excise, &c &c. These tho' not equal, are less unequal than quotas.
[1:592; Madison, 12 July]
Mr. Govr. Morris, admitted that some objections lay agst. his motion, but supposed they would be removed by restraining the rule to direct taxation. With regard to indirect taxes on exports & imports & on consumption, the rule would be inapplicable. Notwithstanding what had been said to the contrary he was persuaded that the imports & consumption were pretty nearly equal throughout the Union.
General Pinkney liked the idea. He thought it so just that it could not be objected to. But foresaw that if the revision of the census was left to the discretion of the Legislature, it would never be carried into execution. The rule must be fixed, and the execution of it enforced by the Constitution. He was alarmed at what was said yesterday, concerning the Negroes. He was now again alarmed at what had been thrown out concerning the taxing of exports. S. Carola. has in one year exported to the amount of £600,000 Sterling all which was the fruit of the labor of her blacks. Will she be represented in proportion to this amount? She will not. Neither ought she then to be subject to a tax on it. He hoped a clause would be inserted in the system restraining the Legislature from a taxing Exports.
Mr. Wilson approved the principle, but could not see how it could be carried into execution; unless restrained to direct taxation.
Mr. Govr. Morris having so varied his motion by inserting the word "direct". It passd.
[2:95; Madison, 23 July]
Genl. Pinkney reminded the Convention that if the Committee should fail to insert some security to the Southern States agst. an emancipation of slaves, and taxes on exports, he shd. be bound by duty to his State to vote agst. their Report.--
[2:142, 168; Committee of Detail, IV, IX]
agrd. No Taxes on exports.--
. . . . .
No Tax or Duty shall be laid by the Legislature, on Articles exported from any State;
[2:305; Madison, 16 Aug.]
Art: VII. Sect. 1. taken up.
Mr. L. Martin asked what was meant by the Committee of detail in the expression "duties" and "imposts". If the meaning were the same, the former was unnecessary; if different, the matter ought to be made clear.
Mr Wilson, duties are applicable to many objects to which the word imposts does not relate. The latter are appropriated to commerce; the former extend to a variety of objects, as stamp duties &c.
Mr. Carroll reminded the Convention of the great difference of interests among the States, and doubts the propriety in that point of view of letting a majority be a quorum.
Mr. Mason urged the necessity of connecting with the power of levying taxes duties &c, the prohibition in Sect 4 of art VI that no tax should be laid on exports. He was unwilling to trust to its being done in a future article. He hoped the Northn. States did not mean to deny the Southern this security. It would hereafter be as desirable to the former when the latter should become the most populous. He professed his jealousy for the productions of the Southern or as he called them, the staple States. He moved to insert the following amendment: "provided that no tax duty or imposition, shall be laid by the Legislature of the U. States on articles exported from any State"
Mr Sherman had no objection to the proviso here, other than it would derange the parts of the report as made by the Committee, to take them in such an order.
Mr. Rutlidge. It being of no consequence in what order points are decided, he should vote for the clause as it stood, but on condition that the subsequent part relating to negroes should also be agreed to.
Mr. Governeur Morris considered such a proviso as inadmissible any where. It was so radically objectionable, that it might cost the whole system the support of some members. He contended that it would not in some cases be equitable to tax imports without taxing exports; and that taxes on exports would be often the most easy and proper of the two.
Mr. Madison. 1. the power of taxing exports is proper in itself, and as the States cannot with propriety exercise it separately, it ought to be vested in them collectively. 2. it might with particular advantage be exercised with regard to articles in which America was not rivalled in foreign markets, as Tobo. &c. The contract between the French Farmers Genl. and Mr. Morris stipulating that if taxes sd. be laid in America on the export of Tobo. they sd. be paid by the Farmers, shewed that it was understood by them, that the price would be thereby raised in America, and consequently the taxes be paid by the European Consumer. 3. it would be unjust to the States whose produce was exported by their neighbours, to leave it subject to be taxed by the latter. This was a grievance which had already filled N. H. Cont. N. Jery. Del. and N. Carolina with loud complaints, as it related to imports, and they would be equally authorized by taxes by the States on exports. 4. The Southn. States being most in danger and most needing naval protection, could the less complain if the burden should be somewhat heaviest on them. 5. we are not providing for the present moment only, and time will equalize the situation of the States in this matter. He was for these reasons, agst the motion
Mr. Williamson considered the clause proposed agst taxes on exports as reasonable and necessary.
Mr. Elseworth was agst. Taxing exports; but thought the prohibition stood in the most proper place, and was agst. deranging the order reported by the Committee
Mr. Wilson was decidedly agst prohibiting general taxes on exports. He dwelt on the injustice and impolicy of leaving N. Jersey Connecticut &c any longer subject to the exactions of their commercial neighbours.
Mr Gerry thought the legislature could not be trusted with such a power. It might ruin the Country. It might be exercised partially, raising one and depressing another part of it.
Mr Govr Morris. However the legislative power may be formed, it will if disposed be able to ruin the Country--He considered the taxing of exports to be in many cases highly politic. Virginia has found her account in taxing Tobacco. All Countries having peculiar articles tax the exportation of them; as France her wines and brandies. A tax here on lumber, would fall on the W. Indies & punish their restrictions on our trade. The same is true of livestock and in some degree of flour. In case of a dearth in the West Indies, we may extort what we please. Taxes on exports are a necessary source of revenue. For a long time the people of America will not have money to pay direct taxes. Seize and sell their effects and you push them into Revolts--
Mr. Mercer was strenous against giving Congress power to tax exports. Such taxes were impolitic, as encouraging the raising of articles not meant for exportation. The States had now a right where their situation permitted, to tax both the imports and exports of their uncommercial neighbours. It was enough for them to sacrifice one half of it. It had been said the Southern States had most need of naval protection. The reverse was the case. Were it not for promoting the carrying trade of the Northn States, the Southn States could let their trade go into foreign bottoms, where it would not need our protection. Virginia by taxing her tobacco had given an advantage to that of Maryland.
Mr. Sherman. To examine and compare the States in relation to imports and exports will be opening a boundless field. He thought the matter had been adjusted, and that imports were to be subject, and exports not, to be taxed. He thought it wrong to tax exports except it might be such articles as ought not to be exported. The complexity of the business in America would render an equal tax on exports impracticable. The oppression of the uncommercial States was guarded agst. by the power to regulate trade between the States. As to compelling foreigners, that might be done by regulating trade in general. The Government would not be trusted with such a power. Objections are most likely to be excited by considerations relating to taxes & money. A power to tax exports would shipwreck the whole.
Mr. Carrol was surprised that any objection should be made to an exception of exports from the power of taxation.
It was finally agreed that the question concerning exports shd. lie over for the place in which the exception stood in the report. Maryd. alone voting agst it
[2:359; Madison, 21 Aug.]
Art. VII. sect. 4.--Mr. Langdon. by this section the States are left at liberty to tax exports. N. H. therefore with other non-exporting States, will be subject to be taxed by the States exporting its produce. This could not be admitted. It seems to be feared that the Northern States will oppress the trade of the Southn. This may be guarded agst by requiring the concurrence of 2/3 or 3/4 of the legislature in such cases.
Mr Elseworth--It is best as it stands--The power of regulating trade between the States will protect them agst each other--Should this not be the case, the attempts of one to tax the produce of another passing through its hands, will force a direct exportation and defeat themselves--There are solid reasons agst. Congs taxing exports. 1. it will discourage industry, as taxes on imports discourage luxury. 2. The produce of different States is such as to prevent uniformity in such taxes. there are indeed but a few articles that could be taxed at all; as Tobo. rice & indigo, and a tax on these alone would be partial & unjust. 3. The taxing of exports would engender incurable jealousies.
Mr Williamson. Tho' N--C. has been taxed by Virga by a duty on 12,000 Hhs of her Tobo. exported thro' Virga yet he would never agree to this power. Should it take take place, it would destroy the last hope of an adoption of the plan.
Mr. Govr Morris. These local considerations ought not to impede the general interest. There is great weight in the argument, that the exporting States will tax the produce of their uncommercial neighbours. The power of regulating the trade between Pa & N. Jersey will never prevent the former from taxing the latter. Nor will such a tax force a direct exportation from N--Jersey--The advantages possessed by a large trading City, outweigh the disadvantage of a moderate duty; and will retain the trade in that channel--If no tax can be laid on exports, an embargo cannot be laid, though in time of war such a measure may be of critical importance--Tobacco, lumber, and live-stock are three objects belonging to different States, of which great advantage might be made by a power to tax exports--To these may be added Ginseng and Masts for Ships by which a tax might be thrown on other nations. The idea of supplying the West Indies with lumber from Nova Scotia, is one of the many follies of lord Sheffield's pamphlets. The State of the Country also, will change, and render duties on exports, as skins, beaver & other peculiar raw materials, politic in the view of encouraging American Manufactures.
Mr. Butler was strenuously opposed to a power over exports; as unjust and alarming to the staple States.
Mr. Langdon suggested a prohibition on the States from taxing the produce of other States exported from their harbours.
Mr. Dickenson. The power of taxing exports may be inconvenient at present; but it must be of dangerous consequence to prohibit it with respect to all articles and for ever. He thought it would be better to except particular articles from the power.
Mr. Sherman--It is best to prohibit the National legislature in all cases. The States will never give up all power over trade. An enumeration of particular articles would be difficult invidious and improper.
Mr Madison As we ought to be governed by national and permanent views, it is a sufficient argument for giving ye power over exports that a tax, tho' it may not be expedient at present, may be so hereafter. A proper regulation of exports may & probably will be necessary hereafter, and for the same purposes as the regulation of--imports; viz, for revenue--domestic manufactures--and procuring equitable regulations from other nations. An Embargo may be of absolute necessity, and can alone be effectuated by the Genl. authority. The regulation of trade between State and State can not effect more than indirectly to hinder a State from taxing its own exports; by authorizing its Citizens to carry their commodities freely into a neighbouring State which might decline taxing exports in order to draw into its channel the trade of its neighbours--As to the fear of disproportionate burdens on the more exporting States, it might be remarked that it was agreed on all hands that the revenue wd. principally be drawn from trade, and as only a given revenue would be needed, it was not material whether all should be drawn wholly from imports--or half from those, and half from exports--The imports and exports must be pretty nearly equal in every State--and relatively the same among the different States.
Mr Elseworth did not conceive an embargo by the Congress interdicted by this section.
Mr. McHenry conceived that power to be included in the power of war.
Mr. Wilson. Pennsylvania exports the produce of Maryd. N. Jersey, Deleware & will by & by when the River Delaware is opened, export for N--York. In favoring the general power over exports therefore, he opposed the particular interest of his State. He remarked that the power had been attacked by reasoning which could only have held good in case the Genl Govt. had been compelled, instead of authorized, to lay duties on exports. To deny this power is to take from the Common Govt. half the regulation of trade--It was his opinion that a power over exports might be more effectual than that over imports in obtaining beneficial treaties of commerce.
Mr. Gerry was strenuously opposed to the power over exports. It might be made use of to compel the States to comply with the will of the Genl Government, and to grant it any new powers which might be demanded--We have given it more power already than we know how will be exercised--It will enable the Genl Govt to oppress the States, as much as Ireland is oppressed by Great Britain.
Mr. Fitzimmons would be agst. a tax on exports to be laid immediately; but was for giving a power of laying the tax when a proper time may call for it--This would certainly be the case when America should become a manufacturing country--He illustrated his argument by the duties in G--Britain on wool &c.
Col. Mason--If he were for reducing the States to mere corporations as seemed to be the tendency of some arguments, he should be for subjecting their exports as well as imports to a power of general taxation--He went on a principle often advanced & in which he concurred, that "a majority when interested will oppress the minority". This maxim had been verified by our own Legislature (of Virginia). If we compare the States in this point of view the 8 Northern States have an interest different from the five Southn. States,--and have in one branch of the legislature 36 votes agst 29. and in the other, in the proportion of 8 agst 5. The Southern States had therefore good ground for their suspicions. The case of Exports was not the same with that of imports. The latter were the same throughout the States: the former very different. As to Tobacco other nations do raise it, and are capable of raising it as well as Virga. &c. The impolicy of taxing that article had been demonstrated by the experiment of Virginia--
Mr Clymer remarked that every State might reason with regard to its particular productions, in the same manner as the Southern States. The middle States may apprehend an oppression of their wheat flour, provisions, &c. and with more reason, as these articles were exposed to a competition in foreign markets not incident to Tobo. rice &c--They may apprehend also combinations agst. them between the Eastern & Southern States as much as the latter can apprehend them between the Eastern & middle--He moved as a qualification of the power of taxing Exports that it should be restrained to regulations of trade, by inserting after the word "duty" Sect 4 art VII the words "for the purpose of revenue."
On Question on Mr. Clymer's motion
N. H-- no-- Mas. no. Ct. no. N. J-- ay. Pa ay. Del. ay. Md. no. Va. no. N--C. no. Geo. no. [Ayes--3; noes--7.]
Mr. Madison, In order to require 2/3 of each House to tax exports--as a lesser evil than a total prohibition moved to insert the words "unless by consent of two thirds of the Legislature", Mr Wilson 2ds. and on this question, it passed in the Negative.
N. H. ay. Mas-- ay. Ct. no. N. J. ay. Pa. ay. Del. ay. Md. no. Va. no. (Col. Mason, Mr. Randolph Mr. Blair no. Genl Washington & J. M. ay.) N. C. no. S--C. no. Geo. no. [Ayes--5; noes--6.]
Question on sect: 4. art VII. as far as to "no tax shl. be laid on exports--It passed in the affirmative--
N. H. no. Mas. ay. Ct. ay. N--J. no. Pa. no--Del. no. Md ay. Va. ay (Genl W. & J. M. no.) N. C. ay. S. C. ay. Geo-- ay. [Ayes--7; noes--4.]
[2:374; Madison, 22 Aug.]
Mr Govr. Morris wished the whole subject to be committed including the clauses relating to taxes on exports & to a navigation act. These things may form a bargain among the Northern & Southern States.
Mr. Butler declared that he never would agree to the power of taxing exports.
Mr. Sherman said it was better to let the S. States import slaves than to part with them, if they made that a sine qua non. He was opposed to a tax on slaves imported as making the matter worse, because it implied they were property. He acknowledged that if the power of prohibiting the importation should be given to the Genl. Government that it would be exercised. He thought it would be its duty to exercise the power.
Mr. Read was for the commitment provided the clause concerning taxes on exports should also be committed.
Mr. Sherman observed that that clause had been agreed to & therefore could not committed.
Mr. Randolph was for committing in order that some middle ground might, if possible, be found. He could never agree to the clause as it stands. He wd. sooner risk the constitution--He dwelt on the dilemma to which the Convention was exposed. By agreeing to the clause, it would revolt the Quakers, the Methodists, and many others in the States having no slaves. On the other hand, two States might be lost to the Union. Let us then, he said, try the chance of a commitment.
On the question for committing the remaining part of Sect 4 & 5. of art: 7. N. H. no. Mas. abst. Cont. ay N. J. ay Pa. no. Del. no Maryd ay. Va ay. N. C. ay S. C. ay. Geo. ay. [Ayes--7; noes--3; absent--1.]
[2:571, 596; Committee of Style]
Sect. 4. No tax or duty shall be laid by the Legislature on articles exported from any State.
Farrand, Max, ed. The Records of the Federal Convention of 1787. Rev. ed. 4 vols. New Haven and London: Yale University Press, 1937.
© 1987 by The University of Chicago