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Whiskey Rebellion

Tax revolt in the United States from 1791 to 1794

  • 28 min read
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Whiskey Rebellion
Frederick Kemmelmeyer · Public domain

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Throughout western Pennsylvania counties, protesters used violence and intimidation to prevent federal officials from collecting the tax. Resistance came to a climax in July 1794, when a US marshal arrived in western Pennsylvania to serve writs to distillers who had not paid the excise. The alarm was raised, and more than 500 armed men attacked the fortified home of tax inspector John Neville. Washington responded by sending peace commissioners to western Pennsylvania to negotiate with the rebels, while at the same time calling on governors to send a militia force to enforce the tax. Washington himself rode at the head of an army to suppress the insurgency, with 13,000 militiamen provided by the governors of Virginia, Maryland, New Jersey, and Pennsylvania. The leaders of the rebels all fled before the arrival of the army, and there was no confrontation. About 150 men were arrested, but only 20 held for trial in Philadelphia, and only two were convicted (eventually pardoned).

The Whiskey Rebellion demonstrated that the new national government had the will and ability to suppress violent resistance to its laws, though the whiskey excise remained difficult to collect. The events contributed to the formation of political parties in the United States, a process already under way. The whiskey tax was repealed in 1802 during the Jefferson administration.

Whiskey tax

A new U.S. federal government began operating in 1789, following the ratification of the United States Constitution. The previous central government under the Articles of Confederation had been unable to levy taxes; it had borrowed money to meet expenses and fund the Revolutionary War, accumulating $54 million in debt. The state governments had amassed an additional $25 million in debt. Secretary of the Treasury Alexander Hamilton sought to use this debt to create a financial system that would promote American prosperity and national unity. In his Report on Public Credit, he urged Congress to consolidate the state and national debts into a single debt that would be funded by the federal government. Congress approved these measures in June and July 1790.

A source of government revenue was needed to pay the respectable amount due to the previous bondholders to whom the debt was owed. By December 1790, Hamilton believed that import duties, which were the government's primary source of revenue, had been raised as high as feasible. He therefore promoted passage of an excise tax on domestically produced distilled spirits. This was to be the first tax levied by the national government on a domestic product. The transportation costs per gallon were higher for farmers removed from eastern urban centers, so the per-gallon profit was reduced disproportionately by the per-gallon tax on distillation of domestic alcohol such as whiskey. The tax applied to all distilled spirits, but consumption of American whiskey was rapidly expanding in the late 18th century, so the excise became widely known as a "whiskey tax". Taxes were politically unpopular, and Hamilton believed that the whiskey excise was a luxury tax and would be the least objectionable tax that the government could levy. In this, he had the support of some social reformers, who hoped that a "sin tax" would raise public awareness about the harmful effects of alcohol. The Whiskey Excise Act sometimes known as the "Whiskey Act", became law in March 1791. George Washington defined the revenue districts, appointed the revenue supervisors and inspectors, and set their pay in November 1791.

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