him in regard to General Granger. Your views in regard to the unfitness of Generals Hurlbut and Granger for an important command, as telegraphed to me, were forwarded to General Canby.

H. W. HALLECK,

Major-General and Chief of Staff.

CITY POINT, March 2, 1865-12. 30 p. m.

(Received 3. 55 p. m.)

Major-General HALLECK,

Washington:

I think orders should go to Canby to put General Steele in command of the new corps formed, which properly should be numbered Thirteenth, and A. J. Smith's Sixteenth.

U. S. GRANT,

Lieutenant-General.

HDQRS. MILITARY DIVISION OF WEST MISSISSIPPI

New Orleans, La., March 2, 1865.

Major General H. W. HALLECK,
Chief of Staff, Washington, D. C.:

SIR: I have the honor to acknowledge the receipt of a communication from the Secretary of the Treasury of the 13th of January, transmitted with your indorsement of the 5th ultimo, covering certain papers in relation to the tax upon products of insurrectionary districts. The case is not fairly stated by the purchasing agent of the Treasury Department. The products of insurrectionary districts have been subject, since the occupation of this Valley, to military taxes, and the revenue derived from this source has been devoted to the care of freedmen refugees and other charities or to sanitary and municipal purposes. This taxation and the application of the revenue derived from it are legitimate under the laws of war. The tax upon cotton was $5 per bale. I remitted it upon cotton purchased under the eighth section of the act of Congress approved July 2, 1864; but pending that this system involved some expenses proper in themselves, but for which there was no military appropriation applicable, I authorized a tax of 50 cents on each bale of cotton. Correctly stated, my action has been a remission of $4. 50 per bale of cotton, and proportionally on other products in favor of the traders. In view of the facts stated in my report of the 27th ultimo, this remission was a grave mistake, and I recommend that the original tax be reinstated by order of the War Department. Orders will be given in accordance with your instructions.

Very respectfully, sir, your obedient servant,

E. R. S. CANBY,

Major-General, Commanding.

GENERAL ORDERS,
HEADQUARTERS CAVALRY FORCES,
MIL. DIV. OF WEST MISSISSIPPI, Numbers 1.
New Orleans, La., March 2, 1865.

In pursuance of General Orders, Numbers 28, current series, from headquarters Military Division of West Mississippi, I hereby assume com-