is the name of the spirits monopoly law introduced in 1919. It ensured total state control on all spirits and by-products and also introduced a few changes in civil law and the responsibilities and rights of local authorities.
Until that law was passed, all spirits where produced by private companies which of course required a special (and pretty expensive) permit; those companies then had to pay a very high spirit tax to the local authorities. Various irregularities during this process as well as the large number of moonshiners resulted in a high annual loss in taxes, adding to the high cost for an army of tax inspectors that was needed to frequently control the different companies.
One should hold in mind that moonshining until then not seen as criminal act (something handled by the police) but a tax offence, and that fell under the authority of tax officials. Of course a tax inspector was more expensive than a local policeman, but the latter normally knew their district a lot better. As result of the new law, moonshining was also declared a criminal act, resulting in a lower number of tax inspectors needed to ensure a regular tax flow and increasing the amount of money actually being made out of spirit tax.
These changes where so efficient that a few years later, the taxes on spirits were lowered as the effort needed to ensure the flow of taxes had been cut back to a minimal effort on the side of the state.
© 2004-2021 C.S.Marshall, all rights reserved