Imagens das páginas


In so far, therefore, as a tax upon house-rent falls on the inhabitants, it is one of those taxes which must fall indiscriminately upon all the three sources of revenue formerly mentioned, and is properly to be classed with the taxes imposed on consumable commodities.

In treating of these, it will appear afterwards, that the general principle which has served to recommend them to modern. statesmen is, that they afford the most practicable mode of taxing revenue, which it is scarcely possible to tax proportionably by any direct imposition. The revenue, it is supposed, will in most cases be nearly in proportion to the expense; and the expense is measured by the consumable commodities on which it is laid out. This general principle applies with peculiar force to the subject now under consideration, as there is scarcely any one article of consumption which may be assumed with so great confidence, as a scale for estimating the whole expenditure of an individual. A proportional tax on it might (in Mr. Smith's opinion) produce a more considerable revenue than has been hitherto drawn from it in any part of Europe.*

Ground-rents (although they have hitherto not been subjected in any country of Europe to a separate tax) are a still more proper object of taxation than the rent of houses. Such a tax would fall altogether upon the owner of the ground-rent, (who may always be presumed to be actuated by the spirit of monopoly,) and would have no effect to raise the rent of houses, the inhabitants of which, even although they should advance the tax in the first instance, would indemnify themselves by the fall in the ground-rents which the tax would necessarily occasion.

Another consideration strongly recommends this species of revenue as a fit object of taxation, that it is enjoyed without any attention exerted on the part of the owner, and depends almost entirely on local causes connected with the general administration of the country. In this respect, it is distinguished from the ordinary rent of land, which depends, partly at least, on the good or bad management of the landlord.

*[Wealth of Nations, Book V. chap. ii.; Vol. III. p. 285, tenth edition.]



[SUBSECT. I.—Taxes upon Profit in General.]

The revenue arising from Stock divides itself into two parts; (1.) that which pays interest to the owner of the stock; and, (2.) that which is over and above what is necessary for paying the interest.

Of these two parts of Profit the latter is evidently a subject not taxable directly. It is a compensation for the risk and trouble of employing the stock, and which, if the employer did not receive, he would discontinue the employment. If he was taxed directly in proportion to the whole profit, he must either raise the rate of profit, or pay less interest. In the former case, the tax would be finally paid by the landlord or by the consumer, according as the Stock was employed in farming or in mercantile speculations. In the latter case, the tax would fall on the interest of money.

At first view, the interest of money would seem to be a subject as fit for direct taxation as the rent of land; but two circumstances create a wide distinction between them:-(1.) The quantity and value of the land which any man possesses can never be a secret, whereas the whole amount of his capital can scarce ever be exactly ascertained, and, if it could, would be found liable to continual variations.-(2.) Land is a subject which cannot be removed, whereas Stock easily may. A tax, therefore, which tended to drive away stock from any country, would tend to dry up every source of revenue. The profits of stock, the rent of land, and the wages of labour would be diminished by the removal. Hence, the loose manner in which stock is estimated by those nations, who have attempted to tax the revenue arising from it. In England, for example, if the greater part of the lands are not rated to the land-tax at half their actual value, the greater part of the stock is scarce rated at the fiftieth part of its actual value. Nor, indeed, is it possible that such a tax can be levied according to any estimate ap

proaching to the truth, without so severe an inquisition into the circumstances of individuals, as would be inconsistent with the manner and spirit of a mercantile country.

[SUBSECT. II.-Taxes upon the Profit of Particular

The taxes on Profit, which we have been now considering, are supposed to be levied on it merely as arising from Stock, without any regard to the manner in which it is employed; besides these, however, it has been the policy of some countries. to impose extraordinary taxes on the profits which particular employments of stock produce; sometimes on the profits derived from particular branches of trade, and sometimes on those arising from agriculture. Of the former kind are, in England, the tax upon hawkers and pedlars, that upon hackney-coaches and chairs, and that which the keepers of ale-houses pay for a license to retail ale and spirituous liquors.

A tax upon the profits of stock must always fall finally upon the consumers, and if it is proportioned to the trade of the dealer, occasions no oppression to him. When it is not so proportioned, but is the same upon all dealers, though, in this case, too, it is finally paid by the consumer, yet it favours the great, and occasions some oppression to the small dealer.

The tax known under the old French Government by the title of the Personal Taille, affords the most remarkable instance that has occurred in modern Europe, of a tax upon the profits of stock employed in agriculture.

During the disorderly period when the Feudal Government subsisted in vigour, the great weight of taxation fell on those whose weakness left them at the mercy of the sovereign. Hence the taxes which, in some countries, were confined to lands held in property by an ignoble tenure, and which, in others, were laid on the supposed profits of all those who farmed lands belonging to other people, whatever might be the tenure by which the proprietors held them. In the former case, the taille was said to be real, in the latter to be personal.

Examples of both were to be found under the monarchy of France, and they are both liable to strong objections, although, of the two, the latter is by far the most unjust and oppressive.

When a tax is imposed on the profits of stock in a particular branch of trade, the traders are careful that the tax should fall on the consumer. But when a tax is imposed on the profits of stock employed in agriculture, it must fall finally upon the landlord. The more the farmer is obliged to pay in the way of tax, the less he can afford to pay in the way of rent. Although, therefore, a tax of this kind, imposed during the currency of a lease, may distress or even ruin the farmer, it must always fall upon the landlord when the lease is renewed.

In countries where the personal taille takes place, the farmer is commonly assessed in proportion to the stock which he appears to employ in cultivation. He therefore cultivates with the most wretched instruments of husbandry that he can,—a mistaken policy, no doubt, on his part, in many instances, but resulting naturally from the circumstances in which he is placed. The consequence is, that cultivation is discouraged, to the prejudice, more or less, of the husbandman himself, of the landlord, and of the public.

For an examination of the other classes of taxes formerly mentioned, I must content myself with referring to Mr. Smith.* In the prosecution of the subject, my plan was to state the results of the speculations of those writers whose opinions have had, of late years, the greatest practical influence on the financial operations of this country. But this is a subject far too extensive for me to undertake at present.


In the course of the foregoing review of different taxes, I have stated the most important results of the speculations of those writers whose opinions have had, of late years, the greatest practical influence on the financial operations of this country. From what has been said, it would appear that taxes on con* [Wealth of Nations, Book V. chap. iii.; Vol. III. pp. 311-394, tenth edition.]

sumption are recommended by very peculiar and weighty advantages:-1. Money1 is thus drawn into the Exchequer out of the pocket of the subject without his perceiving it, the tax being blended with the price of the commodity. 2. Taxes on consumption are, in some measure, voluntary, as a man may choose how far he will use the commodity which is taxed. 3. Every extension of this species of tax has a tendency (at least within certain limits) to create a new ability in the subject to defray it; for when a tax is laid upon goods consumed by the mass of the people, it more frequently happens that the poor increase their industry so as to add to the wealth of the country, and create a fund for defraying the tax, than that they retrench their living to their own and the public detriment, or raise their wages, so as to make the burden fall upon the rich. It has been further urged in favour of this description of taxes, that they have the exclusive merit of rectifying their own excesses,-inasmuch as, when pushed to an extreme, they encourage smuggling, and produce a deficiency in the revenue.2

Among the most zealous advocates for taxes on consumption are Necker, the Marquis de Casaux, and Mr. Young. The last two writers go so far as to assert, that they should be substituted instead of the land-taxes of France and of England.


On the other hand, it cannot be denied, that taxes of this nature are liable to strong objections, on account,-1. Of the extreme expense of collecting them;-2. Of the severe restraints. on trade as well as liberty, which the collection of them renders necessary; and 3. On account of their tendency to hurt foreign trade by enhancing the price of commodities. In this country, in particular, where this system has been already carried to a very great extent, it seems now to be generally admitted, that it cannot be trusted to as a means of supplying so large a revenue as is required, when we attempt to raise a war supply without

1 Lauderdale's Pamphlet; Young's France.

2 See some further considerations on

the same side of the question in Young's France, p. 523.

3 Young, p. 530.

« AnteriorContinuar »