64TH CONGRESS, HOUSE OF REPRESENTATIVES. REPORT 1st STORING AND CLEANING IMPORTED MEXICAN PEAS FOR EXPORTATION. MAY 13, 1916.-Committed to the Committee of the Whole House on the state of the Union and ordered to be printed. Mr. KITCHIN, from the Committee on Ways and Means, submitted the following REPORT. [To accompany S. 3536.] The Committee on Ways and Means, to whom was referred Senate bill (S. 3536) to provide for the storage and cleaning of imported Mexican peas for exportation, having had the same under consideration, report it back to the House without amendment and recommend that the bill do pass. O HOUSE OF REPRESENTATIVES. No. WATER LIMITATION IN DISTILLERIES. MAY 13, 1916.-Committed to the Committee of the Whole House on the state of the Union and ordered to be printed. Mr. ALLEN, from the Committee on Ways and Means, submitted the following REPORT. [To accompany H. R. 9542.] The Committee on Ways and Means, to whom was referred the bill (H. R. 9542) which proposes to remove the water limitation in distilleries using the filtration-aeration process, having had the same under consideration, report it back to the House without amendment and recommend that the bill do pass. This bill was introduced late in the second session of the Sixtythird Congress, and the amendment suggested by the Treasury Department in the letter hereinafter set forth is identical with the bill H. R. 9542. The purpose of this bill is to enable distilleries using what is known as the filtration-aeration process to use an unlimited amount of water in extracting from the grain those ingredients which produce yeast and alcohol. The law now provides that in distilleries where the filtrationaeration process is used 70 gallons of beer brewed or fermented from grain shall represent not less than a bushel of grain. The meaning and effect of this is that the distiller is prohibited from using more than 70 gallons of water for each bushel of grain of any kind required in the process of manufacturing yeast and alcohol. Before the passage of the law permitting the distiller to use 70 gallons of water to the bushel, he could use only 45 gallons to the bushel and this latter quantity of water was found to be sufficient before the use of the filtration-aeration process. After the adoption of this process it was found that 45 gallons of water were wholly insufficient to accomplish the extraction of a sufficient amount of the ingredients of the grain required for the manufacture of yeast and alcohol to justify its use, and that this limitation resulted in the waste of at least 15 per cent of the whole and also a loss to the Government in revenue. The change in the law increasing the amount of water used to the bushel of grain from 45 gallons to 70 gallons resulted in the receipt. of revenue to the Government from one company alone of $500,000 per annum, and it is estimated that the passage of this act will increase the annual revenue from this company more than $120,000. When the original act of March 1, 1879, was passed prescribing a limit upon the amount of water which a distiller could use, the filtration-aeration process was not in use in this country, and that method was devised for the purpose of regulating distilleries employing an entirely different method. It was thought to be necessary to make such a regulation in order to protect the Government revenue in distilleries of that kind, but it seems to be quite clear that there is no necessity for such a regulation in the case of distilleries using the filtration-aeration process, and it can really afford no protection to the Government in distilleries of that sort. But in any event, in order to make sure that the Government revenue will not suffer as a result of the elimination of the restrictions as to the amount of water to be used, this bill provides that the Commissioner of Internal Revenue with the approval of the Secretary of the Treasury shall be authorized to prescribe by regulation to be made by him such character of surveys as he may find suitable for distilleries using the filtration-aeration process. The letter of the Secretary of the Treasury with reference to H. R. 21220, introduced during the Sixty-third Congress, is hereto appended and made a part of this report. The proposed amendment suggested in this letter is identical with the bill H. R. 9542. TREASURY Department, The CHAIRMAN OF THE COMMITTEE ON WAYS AND MEANS, House of Representatives. SIR: I have the honor to return herewith the copy of the bill H. R. 21220, with reference to the surveys of distilleries, submitted with your letter of the 2d instant for suggestions with regard to the merits of the same and the propriety of its passage, and to inclose for your consideration a proposed amendment to the law in question drawn up by the Commissioner of Internal Revenue, with recommendation that it be substituted for the amendment proposed in the bill introduced on the 28th ultimo, herein referred to. If the change suggested is made in the bill, the department will offer no objection to its passage. Respectfully, W. G. McADO0, Secretary. CONGRESS, CONGRESS, LOSS OF ALCOHOL BY ACCIDENT DURING TRANSPOR TATION. MAY 13, 1916.-Committed to the Committee of the Whole House on the state of the Union and ordered to be printed. Mr. ALLEN, from the Committee on Ways and Means, submitted the following REPORT. [To accompany S. 3861.] The Committee on Ways and Means, to whom was referred the bill (S. 3861) providing for an allowance for leakage or loss by any accident of spirits while in transit from a distillery warehouse to a central denaturing warehouse, having had the same under consideration, report it back to the House without amendment and recommend that the bill do pass. The act of March 2, 1907, is construed by the Treasury Department to require the collection of internal-revenue taxes upon spirits withdrawn tax free thereunder and lost by accident while in transit to a central denaturing warehouse. Under this construction the result is that if the alcohol withdrawn reaches its destination and is denatured it is not taxable, but if while en route to the denaturing warehouse it is destroyed by accident it is taxable. The purpose of the proposed bill is to remedy the aforementioned defect in the present law. The letter of the Acting Secretary of the Treasury relative to this measure is hereto attached and made a part of this report. Hon. CLAUDE KITCHIN, TREASURY DEPARTMENT, Chairman Committee on Ways and Means, House of Representatives. MY DEAR MR. CHAIRMAN: I have the honor to acknowledge the receipt of your letter of the 28th ultimo, inclosing for my examination and opinion as to its merits a bill (S. 3861) providing for an allowance for leakage or loss by any accident of spirits while in transit from a distillery warehouse to a central denaturing warehouse. Under existing law (act Dec. 20, 1879, 21 Stat., 59; and act May 28, 1880, 21 Stat., 145) like allowances are made for spirits lost in transit from internal-revenue bonded warehouses to ports of export or to bonded manufacturing warehouses; and, in view of these provisions of law, I see no objection to the bill now submitted, and would recommend its passage. Respectfully, BYRON R. NEWTON, Acting Secretary. O |