COMPTROLLER OF THE TREASURY. vii

Previous and up to the year 1864, there bad accumulated
in the vaults of the Treasury Department bonds and certifi-
cates of indebtedness, which the State had paid, to the

amount of $5,649,656.83. These bonds and certificates, with
the exception of $154,550.00 in Baltimore City Stocks, and

to the amount of $5,495,106.83, consisted exclusively of her
own obligations and debts, which she had paid and redeemed,
and deposited in what is called a "Sinking Fund," and upon

which she annually transferred to said fund, from her gen-
eral treasury, the accruing interest to be invested in like

manner.

The General Assembly of 1864, with the approval of the

then Governor--Act of 1864, chapter 285--directed $4,495,-
106.83 of these bonds to be canceled and destroyed, and to

that extent relieved the Treasury of--in the language of Ex-
Gov. Grason, Chairman of the Finance Committee of the
Senate in 1852--"an imaginary creditor, and the Treasurer

of the employment of counting his liquidated bonds, and cal-
culating how much interest he would be entitled to receive
from himself."

Up to that period, though the direct tax had been heavy,
no special tax for the payment of a particular debt had ever
been levied updn her people ; and since that period no tax
has been imposed for the payment of principal or interest of
her previously created debt.

The existing "Defence Loan," to which I have referred,

was created in 1868, for the payment of bounties, and a
bcunty tax of 5^ cents on the one hundred dollars was im-
posed, and dedicated to the payment of this loan. The

Comptroller, in his report for the year 1867, states that

"the amount disbursed for bounties from 1864 to 1867, inclu-
sive, is shown to be $4,196,864.25, and the receipts are
$2,364,107.94, being a disbursement of $1,822,756.31 in
excess of receipts."

The entire amount of bounty tax collected from January
1864 to September 30th, 1880, embracing the period during
which bounties were being paid, is $4,057,040.96. The entire
Amount disbursed during the same period for interest on the

"Defence Loans," is $2,443,724.26, showing balance of this