When Thomas Jefferson took office in 1801, the pubic debt stood at $83 million or about ten times the annual government revenue. Debt servicing had accounted for almost 70% of government spending. Jefferson and his Treasury Secretary Albert Gallatin made reducing the debt his top priority. Nevertheless, in first year of the presidency, Jefferson also called for the repeal of all internal taxes including taxes on refined sugars and postage on news papers. In 1802, Congress followed the president's recommendations and abolished all internal duties on retail licenses, sugar, snuff, and even alcohol production. But in 1806, with $23 million of the debt paid down, and the wars in Tripoli over, Congress was now considering the repeal of the duty on Salt. In April of 1806, the John Randolph, the Virginia Congressman and Chair of the house Ways and Means Committee put forth a motion to "inquire into the expediency of repealing so much of any act as lays a duty on salt". Many of the congressman had always considered the duty on Salt to be too high, and falling particularly heavy on the poor and agricultural part of the community, but they had to consider the the loss of revenue and the impact on the national debt. In fact, the original duty of 12 cents per barrel was added to pay off the national debt. Only later, an additional 8 cents was added. Some argued that rather than eliminate the entire duty, only the additional 8 cents should be eliminated.
Eight months later, President Jefferson gave his opinion on the matter in his sixth annual address to Congress. Jefferson noted that the import taxes known as the "Mediterranean fund" was to end at the end of the present session, but the "impost on salt, a necessary of life" was set to continue. The "Mediterranean fund" was 2.5% tax on imports and was levied chiefly on luxuries. Thus, it was the wealthy that were seeing a tax cut, rather than the poor who relied on the free use of salt. Thomas Jefferson disagreed with this and recommended to Congress that they instead eliminate the duties on salt, and keep the "Mediterranean fund" in the short term to pay off the national debt.
"The duties composing the Mediterranean fund will cease by law at the end of the present session. Considering, however, that they are levied chiefly on luxuries and that we have an impost on salt, a necessary of life, the free use of which otherwise is so important, I recommend to your consideration the suppression of the duties on salt and the continuation of the Mediterranean fund instead thereof for a short time, after which that also will become unnecessary for any purpose now within contemplation."Jefferson had always wanted to eliminate the Salt tax and transfer the tax burden from the poor to the wealthy. In a letter written to his Treasury Secretary Albert Gallatin in 1802, Jefferson wrote " I wish it were possible to increase the impost on any articles affecting the rich chiefly to the amount of the sugar tax, so that we might relinquish that at the next session. but this must depend on our reciepts keeping up. as to the tea & coffee tax, the people do not regard it. the next tax which an increase of revenue should enable us to suppress should be the salt tax". And so it was, 4 years later that Jefferson was pushing for the repeal of the salt tax. Congress did repeal the tax in 1807.
http://www.presidency.ucsb.edu/ws/index.php?pid=29448
"Abridgment of the Debates of Congress, from 1789 to 1856", Follet & Foster, 1858 pg 479
http://founders.archives.gov/documents/Jefferson/01-38-02-0345
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