The use of tax stamps in America started with the British during colonial America, when they required a special stamp to be used on certain goods to show that the taxes had been paid or to add an additional tax to goods and services. United States based its laws upon British Common Law, so it is only natural that tax stamps were used here for the same purposes. Playing cards, tobacco products and spirits all have had tax stamps at one time in the United States.
For spirits, it started with the creation of Bonded Warehouses during the American Civil War. Barrels of whiskey could be placed in these bonded warehouses for a year before the taxes had to be paid. When the taxes were paid, a tax stamp was placed upon the barrel to show that taxes had been paid. The barrel was the primary package for distillers to sell their whiskey to customers for most of the 19th century. It is not until the 1880s that bottles became cheap enough to make it profitable for distilleries to bottle their own whiskey. The Bottled-in-Bond Act of 1897 created the tax stamp for bottled whiskey.
The tax stamp served several different purposes. First of all, it was evidence the tax was paid by the distiller. The stamp was a strip stamp that was glued over the cork and doubled as a seal on the bottle. If the stamp was intact, the consumer could assume the bottle had not been opened or tampered with in any manner.
The stamp also gave the season and year the whiskey had been made and entered the bonded warehouse and the season and year that the whiskey had been bottled. The stamp also showed the DSP number of the distillery that made the whiskey. The green government tax stamp became a seal of authenticity and quality. Barrels still received tax stamps before Prohibition since liquor dealers and saloons could still buy full barrels and sell to the customers from those barrels. There was no requirement that the distiller bottle its whiskey for sale. Prohibition changed the laws.
With the repeal of Prohibition, the United States government required all spirits to be sold by the bottle. There were limitations as to what size bottle the distillers could use and the tax stamps reflected these sizes. All bottles were required to have a tax stamp.
Bonded whiskey still used the green tax stamp with all of the required information as before Prohibition, but the government also created a red strip tax stamp for whiskey and other spirits that were not bonded products. This red stamp simply showed that the taxes were paid. No other information was required. The distilleries purchased these stamps from the government and they had a government serial number on them, but this number was only used by the government, not the distilleries. It did not tell the consumer anything other than what block of stamps the distillery had purchased. Some states also required their own tax stamps on bottles of spirits to show that the taxes had been paid, but these were not strip stamps like those used by the Federal Government. They often were stamps that looked like the state issuing them and were applied to the bottle, usually on the shoulder of the bottle near the neck.
Tax stamps went out of use after the government deregulated the industry in 1984. For bonded whiskey, the only information from the stamp that was still required to be put on the label was the DSP number of the distillery that made the whiskey.
Some distilleries continued to use “fake tax stamps” as seals for their bottles for a couple of years to show the whiskey was not tampered with, but that practice ended with improvements to bottle seals. Federal Government Tax stamps for spirits are a thing of the past, but some distilleries are bringing back a strip stamp for bottled whiskey, once again showing when the whiskey was made and when it was bottled. I applaud this action because it is important information that the consumer should be able to find on the bottle.
Photos Courtesy of Rosemary Miller