III.

All the present taxes, except those on intoxicating drinks and tobacco, the consumption of which it is not desirable to increase, should be substituted by a tax on real estate and the funds. There should be no income-tax, nor any tax on personal property. The amount to be obtained from a tax upon income depends upon the statements of the parties to be charged; and these, having a direct interest to misrepresent the matter, do not fail to do so. There is a premium upon lying, fraud, and perjury, and the morals of the nation are undermined. This premium is for the benefit only of the dishonest man-the good citizen suffers in exact proportion to his probity. No one can believe that the income tax of 7d. in the pound on the incomes of traders, professional men, and others, of £150 per year and upwards, not derived from realised property, yields one quarter as much as it ought to do. It is universally conceded that fraud is the rule, an honest return the exception; and yet the church does not raise its voice against this abominable system!

A short time since (March 27, 1848), the chancellor of the exchequer told the house of commons that he was astonished at the results of the income-tax-at the wholesale fraud that must have been perpetrated. He treated the statements made by the people sought to be charged with the income-tax as perfectly ridiculous. And yet he persists in demanding a tax to be collected according to such statements from the parties to be charged with it. Nothing can be less statesmanlike. Besides, a tax upon the tradesman's profits falls upon the public, both rich and poor, whereas the realised property of the country ought to bear nearly, if not quite, all the burthens. If the taxes on intoxicating drinks and tobacco are retained, they will be paid chiefly by the working classes, who will thus contribute at least their full proportion to the public revenue.

The great advantages of a tax upon realised property, as compared with any other system of raising a revenue, are these-it can be collected at a very small expense; and, after the first sale of the property has been effected, there is no class or individual whom it oppresses, annoys, or injures. The tax ceases to be felt in a single generation.

The ignorance and blundering of the British legislature on the subject of taxation is truly astonishing. Thus, a tax upon windows has been imposed, the effect of which has been to disfigure the houses, and limit the supply of light; whereas the same amount might have been raised from a tax upon the estimated annual value of the house, without any injury whatever. Ignorance and selfishness combined have wrought the most wondrous results, in the shape of English taxation. The great object has been to exempt realised property from contributing anything, on account of the national debt; and, with the exception of the recently

imposed income-tax, and a few stamp duties, comparatively trivial in amount, there is no tax upon real estate beyond what existed before the national debt was incurred. The increase of population has greatly enhanced the value of the property of the landed aristocracy, and they have availed themselves of their legislative power to throw the burthen of the national debt upon the poorer classes, the landless portion of the community.

In this policy there has been no attempt at concealment. Thus, upon examining almost every class of duties, it will be found that a less percentage is charged when the rich are to be affected than when the mass are to be called on to contribute to the revenue. For this purpose, elaborate tables of stamp duties are prepared, instead of a simple rule being adopted, that an ad-valorem tax shall be a per centage one. The example thus set of making a distinction between rich and poor will, in all probability, be followed by a democratic legislature, with this difference, the per centage will be higher upon the rich man's property, according to the amount of his receipts, instead of being lower than that paid by the property of men of moderate income.

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CHAPTER VIII.

THE SYSTEMS OF LOCAL AND GENERAL TAXATION IN AMERICA

AND ENGLAND COMPARED (continued).

I. Taxes upon Real Estate in America-Local Taxes-Rigid Economy, and its Evil Consequences-Probable Future Remedy of the Evil-Taxation for the Relief of the Poor in England and America compared-The Effects of Poor Laws.

II. State Taxes upon Personal Property-Licenses, &c., in America-General Comparison of the English and American Systems of Taxation-Evil Effects of the present Taxes in England.

I.

The tax upon real estate in America is not usually levied upon a careful estimate of the net annual value; but the entire value of the property is taken, irrespective of its present profit. The consequence is, that unimproved land is often forfeited for non-payment of taxes; but this is treated by many persons as a wholesome thing, because it is a stimulus to improvement. Still, it would seem that some difference should be made between productive and unproductive property.

In some of the towns, a portion of the revenue, for local purposes, is raised by market tolls; and, to increase the amount of these tolls, stringent laws are enacted, to prevent the sale of certain articles out of the market. This is an awkward mode of taxing food, and the inhabitants are put to the inconvenience of going a great distance to purchase their meat, fruit, fish, and vegetables, which they would otherwise procure from shops in their own immediate neighbourhood. The owners of real estate favour this system, because they suppose that it relieves them from a little taxation, the amount obtained from the tolls being so much money applicable towards the city expenses, which would otherwise be raised from their property.

The owners of real estate have hitherto succeeded in most parts of America in preventing a proper system of relieving the poor from being established. Out-door relief is inadequate, and it is very difficult in most places to obtain relief of any kind. Poor-houses are established in the large cities; and in most of the States laws are made for the relief of the poor. Rigid economy is practised on all occasions, whether the question be the relief of the poor, the drainage, paving, watching, cleansing, or lighting, of the town or city; and yet universal suffrage prevails. The great majority of the voters in the large towns are not

owners of real estate, and all the taxes are usually paid by the landlord, and not by the occupier. This affords a practical refutation of the theorists, who assume that under universal suffrage the representatives of the people will be heedlessly extravagant. The reverse is the case in America: niggard economy prevails. There is hardly a city properly drained, paved, watched, lighted, or cleansed; hardly one with good public grounds; and the roads are almost everywhere bad, because there is a disinclination to be taxed to make them good. Above all, the poor, who are in many places numerous, are not sufficiently provided for. The true interests of the people are sacrificed to the false spirit of economy, and this proves that even in a pure democracy, where the suffrage is universal, the elections annual, and the representatives paid for their services, the men of property exercise an undue influence, although they be a small minority. They control party organs, cliques, and caucuses. Great improvements are required in most American towns to secure the health and comfort of the people; and there is particularly a want of public grounds. It is to be hoped that the mass of people in towns will, before long, emancipate themselves from the thraldom of the land and house owners, by insisting on large sums being raised for these purposes, and also for the liberal relief and assistance of all the indigent, of whom there are in most places considerable numbers of the female sex.

When the people learn the actual operation of a tax upon real estate and discover that the occupier does not permanently bear the burthen, a great reform will be effected in American cities: public parks will be purchased, sanitary measures will be adopted, and no individual will be permitted to suffer from want. The only way to keep up the rate of wages is to prevent the indigent from pressing it down, by creating an excessive competition. This can be approached by making a liberal public provision for those who cannot get employment at fair wages, taking care that their labour, when employed by the public, shall not injuriously affect the market. For this purpose agricultural employment should be preferred. This great question is not unattended by difficulties, but they must be grappled with, there is no alternative; the evils and dangers of the present system by far exceed any that could result from the proposed remedy.

In England the law assumes to provide employment for those who cannot obtain it by their own exertions; and the landed property of the country has for centuries been made liable to the support of the poor. The rate-payers in each parish or district elect officers, who raise as much money as they may deem necessary, by taxation of real estate, for the relief of the poor; and relief cannot be refused to any poor person who demands it, and is willing to enter the poor-house. In this respect England is greatly in advance of most of the States. Many poor persons, however, prefer wandering and begging to the confinement of

:

a poor-house this should not be permitted to continue: the system of out-door relief should be extended; the workhouses should be made more comfortable; employment should be furnished on public farms and gardens; and then vagrancy should not be tolerated. About three out of four of the persons receiving relief in England are allowed money from their parishes, without being required to enter the poor-house; but there is not sufficient liberality in this respect, out-door relief is often denied where it ought to be granted, and the amount of the allowance is often too small.

The English poor laws have been the principal cause of the superior condition of the English people, as compared with those of Scotland and Ireland. The old law of Scotland, affirming the right of the poor to relief, was almost a dead letter in most parts of the country. If Ireland had enjoyed the benefit of a poor law fifty or a hundred years ago, the state of society there would have become very different to what it is now. Where the rich are compelled to keep the poor in a suitable and becoming manner, the former become interested in the welfare of the latter, and zealously seek to employ them profitably. In addition to this, the standard of comfort is kept up in the body of the nation; beggary is to a great extent, if not wholly, suppressed; extreme poverty and destitution are prevented; and the dignity of human nature is in a material degree sustained. All this has a tendency to hinder a downward course, and aid an upward one; to increase the demand for comfort and luxuries, and thus add to employment, and keep up the price of labour. Ireland and Scotland have lately obtained poor laws, and we have no doubt that both countries will derive considerable benefit from their administration. There is a school of political economists opposed to poor laws, but it is losing strength daily, The doctrines of this party were, some time ago, quite fashionable in the United States.

II.

As already observed, the revenue necessary for State purposes in America is raised chiefly by a land tax. But there is usually a tax upon personal property; upon agricultural stock; horses, carriages, pianos, gold and silver watches, and household furniture exceeding a certain amount in value. In some of the States, a rough estimate is made of the value of a man's stock in trade, and he is called upon to pay a tax founded upon that estimate.

The small landowners, being very numerous, control the State legislatures, and generally strive to put taxes upon personal property, without regard to the principles of political economy; not caring much whether the tax is inquisitorial, or will operate equally or unequally, so that it be productive.

In Ohio, there is a small tax upon lawyers and doctors, which varies