top of page

Funding the Spanish-American War

Updated: Dec 24, 2023

Between April and August 1898, the U.S. and Spain fought a war that Spain lost and that resulted in the U.S. taking over Cuba, Puerto Rico, Guam, and the Philippines. Contrary to popular belief, the explosion on the U.S. battleship Maine in the Havana harbor in February 1898 was not the true cause of the Spanish-American War. Although the New York Journal and the New York World both sensationalized the sinking of the Maine and blamed the Spanish, the sinking and the death of 261 sailors and Marines was the result of a terrible accident, not a Spanish attack or sabotage. That said, tensions between the U.S. and Spain were already high, and the sinking of the Maine was certainly a catalyst for subsequent events. Consequently, "Remember the Maine! To hell with Spain!" became a rallying cry for action.


In order to fund the Spanish-Amercian War, the War Revenue Act of 1898 was signed into law on June 13, 1898. The act authorized taxes on a wide range of goods and services including various legal and business transactions such as stock certificates, futures contracts, bills of lading, manifests, and marine insurance. Evidence that the taxes were paid was to be provided by affixing stamps of the appropriate amount on the document.


The taxes became effective on July 1, 1898, which gave the Bureau of Printing and Engraving (BEP) scant time to produce revenue stamps. The BEP initially overprinted standard postage stamps with the initials "I.R." for "Internal Revenue," but in relatively short order, it issued a series of 12 documentary stamps with denominations from 1/2-cent to 80-cents. The stamps featured a vignette of the Maine and were perforated two ways -- roulette and hyphen-hole. These stamps are readily available today both on and off document.


The document in Figure 1 is an example of how these stamps were used. The document is dated October 10, 1899, and is a memorandum of sale between two brokers at the Chicago Board of Trade. The Richardson Company promised to delivery one contract of wheat (equal to 1,000 bushels) in December 1899 to the Weare Company. The Weare Company, in turn, promised to pay The Richardson Company 72-1/4 cents per bushel for a total of $722.50.


Per the War Revenue Act of 1898, the tax on futures transactions was imposed at a rate of one basis point (0.01 percent) of the notional amount. In plain English, for each $100 in value or fraction thereof, a tax of 1-cent was owed. That helpful hint was printed in the upper right-hand corner of the memorandum. Thus, this transaction was subject to a tax of 8-cents, payment of which was indicated by affixing two of the battleship documentary stamps: a 3-cent version (#R165 in the U.S. Scott Catalog) and a 5-cent version (#R167). Both stamps have roulette perforations.


As shown in Figure 2, the stamps are cancelled with the date and the name of the firm that paid the tax, in this case "THE R. CO.," or The Richardson Company.


For more information on 1898 revenue stamps. check out the website "1898 Revenues: United States Revenue Stamps that Financed the Spanish-American War" (http://1898revenues.blogspot.com/). That website contains some information on both The Richardson Company (http://1898revenues.blogspot.com/2012/08/chicago-board-of-trade-members_23.html) and the Weare Company (http://1898revenues.blogspot.com/2012/07/chicago-board-of-trade-members-portus-b.html).

Figure 1

Figure 2 - Detail of Stamps from Figure 1

18 views0 comments

Comments


Post: Blog2 Post
bottom of page