<P> The Whiskey Rebellion (also known as the Whiskey Insurrection) was a tax protest in the United States beginning in 1791 during the presidency of George Washington . The so - called "whiskey tax" was the first tax imposed on a domestic product by the newly formed federal government . It became law in 1791, and was intended to generate revenue for the war debt incurred during the Revolutionary War . The tax applied to all distilled spirits, but American whiskey was by far the country's most popular distilled beverage in the 18th century, so the excise became widely known as a "whiskey tax". Farmers of the western frontier were accustomed to distilling their surplus rye, barley, wheat, corn, or fermented grain mixtures into whiskey . These farmers resisted the tax . In these regions, whiskey often served as a medium of exchange . Many of the resisters were war veterans who believed that they were fighting for the principles of the American Revolution, in particular against taxation without local representation, while the federal government maintained that the taxes were the legal expression of Congressional taxation powers . </P> <P> Throughout Western Pennsylvania counties, protesters used violence and intimidation to prevent federal officials from collecting the tax . Resistance came to a climax in July 1794, when a U.S. marshal arrived in western Pennsylvania to serve writs to distillers who had not paid the excise . The alarm was raised, and more than 500 armed men attacked the fortified home of tax inspector General John Neville . Washington responded by sending peace commissioners to western Pennsylvania to negotiate with the rebels, while at the same time calling on governors to send a militia force to enforce the tax . Washington himself rode at the head of an army to suppress the insurgency, with 13,000 militiamen provided by the governors of Virginia, Maryland, New Jersey, and Pennsylvania . The rebels all went home before the arrival of the army, and there was no confrontation . About 20 men were arrested, but all were later acquitted or pardoned . Most distillers in nearby Kentucky were found to be all but impossible to tax--in the next six years, over 175 distillers from Kentucky were convicted of violating the tax law . Numerous examples of resistance are recorded in court documents and newspaper accounts . </P> <P> The Whiskey Rebellion demonstrated that the new national government had the will and ability to suppress violent resistance to its laws, though the whiskey excise remained difficult to collect . The events contributed to the formation of political parties in the United States, a process already underway . The whiskey tax was repealed in the early 1800s during the Jefferson administration . </P> <P> A new U.S. federal government began operating in 1789, following the ratification of the United States Constitution . The previous central government under the Articles of Confederation had been unable to levy taxes; it had borrowed money to meet expenses and fund the Revolution, accumulating $54 million in debt . The state governments had amassed an additional $25 million in debt . Secretary of the Treasury Alexander Hamilton sought to use this debt to create a financial system that would promote American prosperity and national unity . In his Report on Public Credit, he urged Congress to consolidate the state and national debts into a single debt that would be funded by the federal government . Congress approved these measures in June and July 1790 . </P>

Why was the whiskey rebellion a significant event in the early days of the new government
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