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October 16, 1852.] THE LEADER, " 5
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THE IIEAKSE AND THE BAIL. We see an auth...
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NOTICES TO CORRESPONDENTS. "W v. hou to ...
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CltKAT INDUBTRIATj EXHIIHTION OV Ilt"El,...
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Note: This text has been automatically extracted via Optical Character Recognition (OCR) software. The text has not been manually corrected and should not be relied on to be an accurate representation of the item.
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Taxation Reduced To Unity And Simplicity...
ioration may produce a measure of the same effect . Land it self , indeed , is permanent ; but the value , and even the ownership , of land , are amongst the most refined of social results . Such are the difficulties of principle , to say the least of them , which Mr . Babbage and others let in by assuming that income is a true gauge of property—an assumption wholly unsupported , we think wholly untrue and we hope to show wholly unnecessary for any
practical purpose . Mr . Babbage , indeed , himself says , «* I think it would be impossible to get the real incomes of all parties" ( 5450 ) . We can then harjjjy suppose that any practical difficulties would be much diminished by adopting this mistaken " approximation" to the value of property . Nor do we see why we should still adhere to the principles , doubtful or absolutely false , whic h have been subsequently employed to sustain the unfortunate original assumption .
The principle of Mr . J . S . Mill is , that equal taxation requires an equal sacrifice from all ( 5256 ) , and that , consequently , not only income , but wants , should be considered ( 5223 ) . He proposes to tax what a man may be fairly supposed to spend on himself out of a given income , and exempt the rest ( 5283 ) j and he would further exempt some such amount as 501 . per annum , on account of necessaries , which should not be taxed ( 5258 ) . It is difficult to see how Mr . Mill arrives at his
principle that taxation should require an equal sacrifice from all , except by-a kind of inversion of the vague and insufficient maxim , that Government should act for the equal happiness of all ; and so , anything which it does subtractively to that happiness , ought to be to the equal disadvantage of all . This is based on the principle that Government has the right , to some extent , to look into the happiness of each person , and the means by which he may choose to promote it . If this principle be traced to its consequences , we believe it will always be found to issue in a despotism bureaucratic and French , if not monarchical—a despotism none the better if it happen to be constitutional in its form and paternal in its designation .
But how is taxation to be so regulated as to make it an equal sacrifice for all ? One man has six children , and 1001 . per annum ; his quiet temperament and orderly habits would not permit 101 . per annum to break his peace . His neighbour has 5001 . a year , a spendthrift son , and a horrible temper . Five pounds a year would be just so much added to his debts , and a sore trial of his patience . Mr . Mill does not propose iiny plans by which the seemingly impracticable standard of " equal sacrifice" can be made available .
Mr . Mill , however , may mean by the term , that equal pecuniary sacrifice which might be said to result from temporary incomes being untaxed for the amount requisite to accumulate the means of affording an income equal to the remainder on the termination of the period of enjoyment . This , if practicable , would put thorn on an equal footing with permanent incomes , and so perhaps the sacrifice be said to be equal to each kind . But here , again , equality as to the effect on the owners
is impossible . One income is for life , another for a term of years , another during the pleasure or prosperity of employers , another during health and favouring circumstances . Mr . Mill guesses the fair proportion of terminable uniform incomes to be t . ixed at threofourths , professional incomes at one half , whilo thoso from land and other permanent sources are- taken at their full . ] ' { ufc i ] XG necessity of guess in the very first K l' 0 ]> in the application of a great principle , is not very
assuring as to its soundness . A tax so regulated , like any other tax on income , '' as the fatal objection of not following the proportion ' » which the tax-payer occasions cost to his fellows . A 'mm with a large property , although it yield no income , as much requires for the time tho protection of the s | iile us lie who has sin equally largo property , and <« Tives a threat income from it . lint if he does not pay his share of the cost , others must bo unduly bur-( 1 ^» ' < 1 to pay it for hi ,,,. f > M one point we aigm * with Mr . Mill . That portion 0 an income which is wived is twice ! taxed if taxed as i
'"come ; l " jf ; ; jj ,, ^ , (»( l directly an income , and Uieii indirectly , to the sumo extent really , by the fax <» " > the ineoni « derived from it as invested capital . This k 'iiinjr fault Heeins inherent in the nature of an income ~!\ f an < * H » t to bo separated from it by any contrivance . ° 'H show hereafter how another principle of taxation avoids it . Mr . Mill himself virtually admits the principle of ¦¦ 'Miijr ( , ] , „ ,, ] U ( , | - j . j ( o j ) rOp . r ( , y when bo advocated a '" £ < ' tax on successions , and ( 5421 ) nays he would tax
' ¦ nid iiu in .,, .. ji * ,. , ¦¦ ii ,, iiM i - " HHuny ,, l , her saleable properly . I !« imUIh , " Wlmtj v « M , ux I levied 1 would levy on the saleable value ; ' . ° UK 'd « of OKtimatiuft different kinds of property "' ' different , but what it would well for 1 would
tax . " He seems to have been led away from the obvious justice and practicability of the same principle in reference to anniml taxation , by not observing that income is no test of the value of the property protected , nor of the cost of protecting it , nor even of enjoyment or sacrifice . Our position then being , that property , not income , is the true object of taxation , we set aside all questions and differences as to particular modes of taxing income . To us those questions seem to lead to false conclusions or to none ; and if income is not to be taxed at all , it is of little use to follow out the several opinions as to the mode of taxing it .
Nevertheless , the evidence is m some points worthy of remark . Every officer of Government attests the difficulty of assessing the income tax , and the vast extent of evasion . Every theorist who starts on the basis of an income-tax , differs from every other as to the expediency and even the justice of different modes of assessment . Every one has a plan ; but every plan is so full of difficulties and exceptions , as to lead to the strongest suspicion that not one of them has that characteristic of truth which is found in remaining consistent with all other truth . Incomplete and ill understood , if not absolutely untrue , seems / every one of the plans the Committee had before it , the existing system included .
In these debates , extraneous to our views , there is only one point in which we feel any interest . If an income tax is to exist , we trust it will be freed of the error by which all incomes are taxed alike . It has taken some trouble to disentangle the sophistries by which , this harsh and uneven equality has been suggested and defended . An income which may terminate in an hour by accident , or by the revulsion of the overwrought power which earned it , has been said to be as good , while it lasts , as the income from acres or consols , and that it pays only while it lasts . But it is not
income purely . It is , in part , a return of that capital of life and strength , and of instruction and experience , which will be eventually all rendered up sooner or later , the wasting source of these annual drafts of life coined into income . We have no interest in further pursuing this fallacy than to remark , that the system which could so long have sheltered it must be itself fallacious . We revert now to our own plan , deferring for the present that part of it which consists in a personal tax . Our chief , if needful our sole , item of taxation is a uniform tax on au visible and tangible property , levied on the actual possessor for the time .
We omit from the assessment all rights not accompanied by actual possession of their tangible object ; for these rights , in all cases where they are true and realizable , are only representatives of property held by others , and already taxed in their hands . Where the property they should represent has been lost or destroyed , there is nothing loft for the Government to protect . Where these rig hts affect tho products of future industry they will bo taxed when they coino to
fruition . But there is nothing at present to protect , or even to litigate , except where the claim has some security on actual property , or applies itself , with more or less of legal form and stringency , to some actual property already taxed . Omitting , then , the direct assessment of those rights , we would leave tho several parties interested to adjust among themselves tho ultimate incidence of tho tax , as they do that of insurance , or of any other expense attending the property .
On this point un instructive case occurred in New York . Heal property was taxed under one set of regulations ; personal property under another . Land , which had already been taxed as land , paid tax again on its mortgage : for the mortgage was taxed as personal property without diminution of the original tax . This was complained of , and remedied . But the case , which seemed to bo special , is in fact generic ; and all debts mid other intangible ! rights are , like mortgages , subtractions from the value ! of some material property , more or less elistinetly defined and appropriateel , which if once taxed as property is not justly to bu taxed again in the fennels of the incumbrancer .
It has besen objected to u tax on e-apital , thatit ufl ' ects the source , not the fruit . But a tax proportioned to the capital is not necessarily a tax paid out o /' capital . . If the expenses e > f tho whole eioininunity be greater than the annual profit of thei whole ) community , the ce > unl-. ry in clearly not worth protecting ; if they be le'SH , them taxens are paid out of profits although they ho proportiemesd to capital . Wei have not Hpncc te > show , us it might be shewn , that , under tho cemelitions
implied "i this eliscussion , taxation nevor can pornmncntly oxceeel thei profits ; and that te ) suppose it to tlo so , lien-eHsarily supposes ulse > another state e > f societ yeuioofun exii ££ e ; rate ! cl Eastern type . Individual cases must be dotormined by individual judgment . If a man havo u concern whoeo profit is less than tho tax on it , lot him judge for himself whether it is worth
continuing , just as he would if the question were one of insurance instead of tax . We shall fcave occasion hereafter to show that the taxation of England , although one-half of it is not for current expenses , is less than even our annual savings after the tax is paid . " But , " says an objector , " a man may thus have a large income , and pay no tax . " Let him , then , have 1000 ? . per annum , spending one half and saving the other . Every article he consumes by means of his expenditure has paid its tax , as property , during the
whole term of its existence , or of its being under the protection of our Government , and he pays the tax in its price . As soon as he has consumed it , there is an end of the duty and at the same time of the expense of the state in respect of it . What he will next consume will equally have paid its tax , and he will equally repay it . Trace his loaf , his sugar , or his coat , to their origin , and it will be found that for so much as he may have spent in the year , he will have paid an exactly proportionate tax .
The 500 ? . per annum which he saves can escape taxation only by being locked up in the shape of coin , to the loss of all the interest . Whether he employ it himself , or lend it himself , or entrust it to the responsible agency of a banker , it is profitless and almost worthless , unless employed as working capital , that is , property ; and as property it is taxed . Whether , then , a man save or spend , he is equally , certainly , and proportionately taxed : and if it be desired to tax income , there is no way in which it can be so certainly reached and so equitably assessed as by a tax on property ; but here he is taxed only once , whether he save or upend ; not , as by the income-tax , twice on that he saves .
It is true that as to income such a tax is indirect ; but so a just tax must be ; for the direct relation of the Government is with property , not income . But even as an indirect tax on income , it has this advantage , that being distributed over all articles and all modes of action alike , it leaves choice of the disposal of income wholly unaffected and free . Moreover , being laid where the actual cost to the Government occurs , where it can be most safely and accurately assessed , and where it can be least easily evaded , it carries with it the least possible aggravation of its amount which the nature of the case admits . Whether , then , we consider taxation in that primary and essential character which results from the direct
relation of Government to property , or mthe secondary and incidental one of its effects on income ( deemed by some , erroneously we think , its first and most important aspect ) , a uniform tax on tangible property alone , seems to us to conform closely to the requisitions aliko of good policy and justice . We shall have to resume some of these considerations when we come to treat of assessment and collection .
October 16, 1852.] The Leader, " 5
October 16 , 1852 . ] THE LEADER , "
The Iieakse And The Bail. We See An Auth...
THE IIEAKSE AND THE BAIL . We see an authorized contradiction in tho Times of a statement that Messrs . Jay and Co . had an interest in tho Oxford anel Birmingham Railway , recently opened with so signal an accident . From tho connexion of the name of " Jay" with tho great mourning establishment in Regentstreot , it was very natural to suppose that that eminent
firm should take an interest in any new railway . It appears , however , that tho Mr . Jay , whoso interest in the Oxford and Birmingham Railway is contradicted , is a contractor for tho execution of works ; who would , no doubt , bo anxious to repudiate tho particular connexion . The cemtradietion , therefore , eloes not ufibct tho beneficial interest which Messrs . Jay anel Co ., e > f Regcnt-streot , must have in that lino , as well as in bo many either railwayn .
Notices To Correspondents. "W V. Hou To ...
NOTICES TO CORRESPONDENTS . " W v . hou to (; all thei attention of our Bath Oorreisponelent on tho " Morality of Woiihhi ' h lti ^ htH" to our rule an to tlio privatti communication of Ilio writer'h name ) .
Cltkat Indubtriatj Exhiihtion Ov Ilt"El,...
CltKAT INDUBTRIATj EXHIIHTION OV Ilt"El , ANI > . — The * Lorel-Lieutenant e > f Ireland baa received a deputation from the Committee of the Great Industrial Exhibitiem of 185 ' . i , te ) present a mse ) lutie > n , requesting him to represent to the Queen tho pride it wemld uflorel heir Irish subjects if hIio wemlel entrust te > tho Executive Management of the Great Exhibition of 1853 houh ! of the articles which she was pleased to exhibit in . 1851 . . Lord Eglinteni promiseel to forward the )
resolution to the Queen , anel to exert his own influence ! to obtain e ^ ouiplianeo with tho request ; and lie ! aeleleel , that " nothing shendd bo wanting on his'part to make the Exhibition' worthy e > f tho country in all resj > ectH . " Him Exoollemery then ' intimated to the ) gentlemen present his elesiro to visit thei buileling during its courae of construction , and it wits at once arranged that he should be present on tho occasion of the raising of the first pillar , which is expected to take pluce in somo ton or twclvo days from this dato .
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Citation
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Leader (1850-1860), Oct. 16, 1852, page 15, in the Nineteenth-Century Serials Edition (2008; 2018) ncse2.kdl.kcl.ac.uk/periodicals/l/issues/cld_16101852/page/15/
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