and stamped in the mode prescribed, except that retail dealers may sell from wooden packages properly stamped.1

Registry of the Factory.-The collector is required to keep a record open to the inspection of any person, containing the name and residence of every person engaged in the manufacture of snuff or tobacco in his district, the place where it is carried on, and the number of the factory. The factories in the district are all numbered consecutively, and the numbers cannot be changed. Under the name of each manufacturer, the collector is to record his annual inventories and his monthly abstracts.2

Label. In addition to the other requirements, the manufacturer of tobacco or snuff is required to print on each package, or to attach thereto a label, on which shall be printed the manufacturer's name, the number of the factory, the district and State in which it is situated, and these words: "NOTICE.-The manufacturer of this tobacco has complied with all the requirements of law. Every person is cautioned, under the penalties of law, not to use this package for tobacco again." Stamps. As in the case of distilled spirits and malt liquors, the tax is paid by a stamps, which indicate the weight and class of the article. They are purchased from the collector of the district in which the factory is situated, and are to be affixed by the actual manufacturer of the article before it is removed from the place of making or factory. Stamps on wooden packages are to be canceled by sinking a portion of the stamp with a steel die into the wood; other stamps are canceled under regulations of the commissioner, which require them to be canceled by writing or printing on the stamp the manufacturer's name and the date of the cancellation. If the stamp used be a strip stamp, it must, in addition, be so affixed that in opening the package or using the contents, the stamp will be effectually destroyed.

Stamps on kegs or barrels of fine cut chewing are to be placed. across the staves, between the first and second tier of hoops. On boxes of fine cut chewing, and boxes or caddies of plug or other chewing tobacco, the stamp is to be affixed over one corner or angle of the box, at equal distances from either end, and attaching about equally to either side. A groove an inch deep is to be made in the wood to receive the stamp and prevent its being rubbed or torn in handling.*

Conditions of Removal for Sale or Consumption.-From what

1 R. S. U. S. § 3363.

3 R. S. U. S. § 3364.

2 R. S. U. S. § 3357.

4 R. S. U. S. § 3369. See regulations of Commissioner Bump, Int. Rev. Laws, 229.

has been said it will appear that before removal, (a) the tobacco must be put up in legal packages; (b) the package must have printed thereon, or securely affixed, a label with the manufacturer's name, the registered number of the factory, and the district and State, and if a wooden package, the manufacturer's name and place of manufacture, or the proprietor's name and his trade-mark, the registered number of the factory, the gross weight, the tax and net weight of each package must be printed or marked on the box. (c) Every package must have affixed and canceled a proper stamp or stamps to indicate the weight and class of the tobacco for which payment of the tax is made. (d) These stamps must be affixed and canceled in the mode prescribed by the commissioner. Any removal of tobacco from the place of manufacture, without a compliance with these conditions, is a removal otherwise than as provided by law, and subjects it to forfeiture. How far the failure to comply with the regulations of the commissioner can be made a cause of forfeiture, or of the imposition of a penalty, will be considered hereafter.

Rate of Tax.-Prior to 1872, there were two rates of tax on tobacco, according to its grade or classification. In that year it was made uniform on all kinds of tobacco. In the Revised Statutes, the tax on snuff is thirty-two cents per pound, and on all kinds of tobacco twenty cents a pound.1 By the act of March 3, 1875, it was increased on tobacco to twenty-four cents per pound, so that the tax on tobacco of every kind is now uniform. This act makes provision that when a manufacturer had made a written contract for tobacco, cigars, or cigarettes, before the passage of the act, he might deliver the tobacco or cigars without paying the increased tax, but the purchaser is required to pay it. This is similar to the provisions noticed heretofore as to the manufacturers of other goods.

Imported Tobacco or Snuff.-These articles not only pay the import duty fixed in the statute, but, in addition thereto, they pay a tax of the same amount as that imposed on the articles manufactured in the United States. The stamps are to be affixed by the owner or importer before they leave the custody of the officers of the customs.*

Stamps Destroyed.—To prevent the use of packages with the old stamps by the manufacturers, not only the dealers in tobacco or snuff, but every person who uses a package is required, when it is emptied, to destroy the stamps. Formerly the law required the stamped por

1R. S. U. S. § 3368; 21 Int. Rev. Rec. 411, report of Commissioner Pratt.

218 U. S. Stat. p. 339. 4 R. S. U. S. § 3377.

'Ante, § 152, p. 511.

tion of the package to be destroyed. The construction given to that law by the department was that it was sufficiently complied with by thoroughly destroying or mutilating the stamp alone.1

Deficiency Assessment.-If the manufacturer complies with the law, he in substance, as in the case of the brewer, assesses his own tax and pays it to the collector before the tobacco leaves the place of manufacture. Usually this will be done, because of the liability of the packages to forfeiture wherever found without the proper stamp, the statute making the absence of the stamp prima facie evidence of non-payment. But should any tobacco or snuff be removed without the payment of the tax, the commissioner is authorized to make an assessment for all such tobacco or snuff removed without the stamps. prescribed. This assessment is in addition to any penalties which may be incurred by such removal. It is to be made within two years after the removal, upon such evidence as the commissioner can obtain. The inventories of manufacturers, and their abstracts from daily entries, if correctly made and preserved by the collectors, together with the collector's account of the sale of stamps, would enable the commissioner to ascertain, whether the product returned by the manufacturer corresponds with the materials used as shown by his own returns. If there was a deficiency, it would, as in the case of the brewer and cigar manufacturer, be a basis upon which such an assessment could be made. But as yet the commissioner has not been able to get from the collectors in most of the districts sufficiently accurate information to enable him to make such assessments. The present system has been in operation since 1868.5

Exportation of Tobacco, Snuff or Cigars.-Either of these articles may be exported without the tax-paid stamps, upon giving an export bond under such regulations as the commissioner may adopt. By an amendment of this section, the party may, at his option, in lieu of an export bond, give a transportation bond, conditioned to deliver the articles on board ship at a port to be named. The exporter notifies the collector of the port of its arrival, and it is then to be inspected. At the time of entry for export, the party is to give a bond, conditioned that the tobacco, snuff, or cigars, shall be landed at the port specified in the entry, or some other port without the jurisdiction of the United States. When it is loaded, the collector trans

1 R. S. U. S. § 3376; 10 Int. Rev. Rec. 61.

R. S. U. S. §§ 3182, 3371.

R. S. U. S. § 3373.

422 Int. Rev. Rec. 37, circular of the commissioner to collectors, &c.

5 21 Int. Rev. Rec. 412, report of Commissioner Pratt.

R. S. U. S. § 3385.

mits to the collector of the district from which the tobacco, snuff or cigars came a clearance certificate, on the receipt of which the transportation bond is canceled.1

Before the tobacco, snuff, or cigars, leave the factory, there is to be affixed a stamp indicating the intention to export, called an export stamp. The law requiring such a stamp does not impose a duty on exports, the object being merely to separate and distinguish the articles which are exempt from the internal revenue tax from those of the same kind which are liable thereto. The price paid for the stamp is intended as a compensation for services rendered. This fee for the tax is very similar to the fee required to be paid in State and city taxation for issuing a license; it has no reference to revenue. It would be strange indeed if this law, the principal object of which was to allow the manufacturer of tobacco, snuff, or cigars, to put his goods on foreign markets free from the tax required to be paid by him if sold in the United States, a law which gives him an important and valuable privilege, should be considered as a tax.2

When the Tax Law takes Effect.-In State taxation such a question rarely occurs, for under the system which prevails there is an annual assessment, commencing at some fixed period, and all taxes are assessed as of the rate prescribed by the statute on that day. But in the customs duties and internal revenue, with but few exceptions in the latter, there is no fixed day for the assessment of the tax. In customs the tax is assessed whenever the goods are entered at the custom house, and it accrues or takes effect at the date of importation. The day of arrival in a port with intent to unload is the day which fixes the tax, and the rate then provided by law governs, unless the act increasing or diminishing the tax provides otherwise. And so in the case of distilled spirits, malt liquors, tobacco, snuff, and cigars, the assessment in substance takes place when the tax-paid stamp is placed on the package about to be removed, and this occurs every day and almost every hour of the day.

The act of March 3, 1875, which increased the rate of tax on tobacco and snuff four cents on the pound, contained the provision that "the increase of tax herein provided for shall not apply to tobacco on which the tax under the existing law shall have been paid when this act takes effect." This act was not signed until 9 o'clock P. M. of that day by the President. In different parts of the country, on that day, stamps were purchased and affixed to tobacco at the rate of twenty cents a

4

118 U. S. Stat. p. 312.

Ante, § 160, p. 559.

Pace. Burgess, Collector, 2 Otto, 372. 418 U. S. Stat. p. 339.

pound. When it was ascertained that the act became a law on that day, the collectors claimed of those who had purchased stamps on that day that they should pay the additional four cents per pound. This claim was founded on the well-recognized doctrine that no fractions are reckoned in a day, and a law that is passed by a legislative body on a particular day, takes effect at the beginning of the day, without reference to the particular period of the day at which it passed; and so when it is signed by the executive officer, the period of the day at which it is signed is not considered. In the Circuit Court for the eastern district of Virginia, it was held that the rule of law that there are no fractions of a day, did not apply to this proviso. The rule it is said is a fiction, adopted for convenience, which must give way whenever the right and justice of the case require it. A different view is taken by other courts, which sustain the general principle that there are no fractions of a day. This rule is a plain one, but when we modify it, and say that there are fractions of a day when right and justice require it, we adopt a most uncertain and variable rule, to which might be applied with much reason the saying of Coke about equity, that it was as variable as the size of the chancellor's foot.

3

§ 171. Manufacture of Cigars-Banks and Bankers.-The term cigar includes cigarettes and cheroots. The conditions on which he is allowed to pursue the occupation are similar to the provisions in the case of the manufacture of tobacco.

1. Statement.-He is to file with the collector a statement in duplicate showing the place of business, and, if in a city, the number of the building and name of the street; and if manufactured for another, the name, residence, and occupation of such person for whom manufactured, or to whom deliver e

2. Bond. He is to give a bond, with sureties approved by the collector, the penalty not to be less than $500, which is to be increased beyond that, $100 for each person proposed to be employed. The bond may be increased, and additional securities required from time to time in the discretion of the collector or commissioner. The conditions of the bond are: (a) That no person will be employed to manufacture cigars who is not duly

121 Int. Rev. Rec. p. 89, circular of Commissioner Douglass; Id. p. 90, opinion of Attorney General; Id. p. 101, reply of the commissioner to the manufacturers of St. Louis.

2 Salmon & Hancock v. Burgess, 21 Int. Rev. Rec. 333.

3 In re Willman, 20 Vt. 653; In re Howes, 21 Vt. 619; United States v. Williams, 1 Paine, 261.