I should discharge the responsible duties devolved upon me unfaithfully if I omitted to place this result before the committee in a clear and unambiguous light. The calculations you have done me the honor to submit to my examination lead to results quite too large in viiew of past experience.

Assuming that 5 per cent. additional upon property (at specie value) as the equivalent of 10 per cent. additional upon income, to which I agree, you estimate the product of the taxes proposed at $952,670,723. The experience of last year showed that the whole product of the taxation which it is now proposed to duplicate was $360,000,000, after restoring the credit given for the tax in kind, &c.

Upon this basis we have no right to anticipate a greater yield than $720,000,000, which is $232,000,000 less than your estimate. By reference to parge 11 of my report of November 7 it will be seen that-

The most moderate estimate of the expenditures

that could be made for the year at this time was. . . $774,000,000

In view of our present circumstances, the sum of

$60,000,000 for the cancellation of notes may

be deducted. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,000,000

------------

714,000,000

Add the new demands. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 396,000,000

------------

1,110,000,000

-------------

-------------

To be raised by taxation as proposed. . . . . . . . . . . . . . . 720,000,000

For sale of bonds, temporary loans, cotton, &c. . . . . 400,000,000

-------------

1,120,000,000

You will perceive how far short of the actual demands upon the Treasury the whole yield of the taxes proposed must prove without an abatement for the tax in kind. But if from the estimated amount of $714,000,000 there is deducted $127,000,000 for the credit of the tax in kind, as I feel confident would be the result in such a case, the revenue would be reduced to $50,000,000-the demands are $1,120,000,000.

I have the honor to remain, your most obedient servant,

G. A. TRENHOLM,

Secretary of the Treasury.

SUBSISTENCE BUREAU,

Richmond, January 17, 1865.

Hon. JAMES A. SEDDON,

Secretary of War:

SIR: In reply to your indorsement on the letter of the Honorable Secretary of the Treasury of the 10th instant, I have to say that I have no doubt that the Secretary of the Treasury feels very anxious to furnish this Bureau the funds needed, and I am not aware of any reason to lead to the inference that I entertained the contrary opinion. I have only to deal with the facts. In the early part of last year, when the object of the Bureau, as has ever been the case, was to convert as much as possible of its appropriation of depreciating currency into appreciating commodities, it had not the money wherewith to make purchases and had, in consequence of the tax upon the currency, to turn in through its officers more than I received in the first three months, $22,000,000 being turned in, against $21,000,000 received, this being the season, too, for collecting meats and the whole country scrambling for supplies of meat for the year's consumption. In the next