REPORT OF THE COMPTROLLER OF THE TREASURY. ix

General has been requested to institute suits to test the
question.

UNITED STATES DIRECT TAX.

By Act of Congress, Chapter 45, of 1861, a direct tax, to
the amount of twenty millions of dollars, was levied upon
the several States to meet the expenses of the war then
being waged, and Maryland's quota of this tax was $436,-
823.33. The General Government made every provision
to collect this tax, but at the same time accorded the priv-
ilege to the States to assume their quotas, and for prompt
payment a discount of 15 per cent, was stipulated. Mary-
land assumed her quota of the levy, and by an Act of the
General Assembly of 1862, Chapter 143, issued the "Mary-
land Defence Law'' to provide means for the defence of the
State of Maryland, and especially to meet "the State's
proportion of the United States Direct tax, levied or to be
levied for the purpose of suppressing rebellion and main-
taining the integrity of the Union.''

On the 28th of June, 1862, Maryland paid her proportion
of this war tax, viz.: 8436,823.33, less 15 per cent dis-
count, leaving the net sum paid 1371,299.83.

Congress at its last session passed an Act to credit and
pay to the several States and Territories and the District of
Columbia all moneys collected under the direct tax levied by
the Act of Congress, approved August fifth, eighteen hun-
dred and sixty-one. The 3rd section of this Act reads as
follows : ''That there is hereby appropriated, out of any
money in the Treasury not otherwise appropriated, such
sums as may be necessary to reimburse each State, Terri-
tory and the District of Columbia for all money found due
to them under the provisions of this Act; and the Treas-
urer of the United States is hereby directed to pay the same
to the Governors of the States and Territories and to the
Commissioners of the District of Columbia, but no money
shall be paid to any State or Territory until the Legis-
lature thereof shall have accepted, by resolution, the sum
herein appropriated, and the trusts imposed, in full satis-
faction of all claims against the United States on account
of the levy and collection of said tax, and shall authorize
the Governor to receive said money for the use and purposes
aforesaid." I would respectfully suggest that after the
amount ($371,299.83) paid to the General Government is
, returned to the State Treasury, it should be placed to the
credit of the Defence Redemption Loan Sinking Fund, a
Fund created for the redemption of Loans issued to defray

the expenses incurred by the State during the late war.