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than sacrifice, of public credit, to bring even this class of the community into a contribution towards the change made in the relative values of the property, constituting the security of these
By abandoning that injurious and inquisitorial system, the tax on profits of trade, of commerce, professions, manufactures, and of the mechanic, &c, in the progress towards capital; that system, so obnoxious to the feelings of Britons, and so unequal and unjust in making no distinction between the value of income and of absolute property; or between certain income and the precarious gains of individual labor; or between income for a certain time, and a time not to be defined; and as to trades, professions, &c. &c. so unsatisfactory, from the difficulty, nay, impossibility of making persons with the same incomes contribute in equal proportions; but taxing those most, who aim at splendor and outward appear ance, and who contribute most to indirect taxes; and by giving comparative exemption to those who, from the parsimony of their habits, or their neglect or disdain of appearances, or by their plea sure to confine their expenses to themselves individually, without the participation of a family; and by resorting to a direct tax on land, on tithes, on funded property; on places and pensions; and all other incomes derivable from Government; and on the dividends payable by all chartered companies; and the income of all corporate bodies, (being the classes of persons and of bodies, who, from their connexion with, and dependence on, the established Government, are bound, in times like the present, to contribute most cordially and most liberally to its support,) so as to prevent it from falling into that state of ruin, which must compromise and involve their interest. The finance minister may obtain an equal amount of taxes without exciting the indignation of the country.
Money advanced on mortgage should either be exempt from this contribution, or the interest be fixed at a rate to make allowance for that contribution; the former is the more eligible plan, as it leaves a better opportunity for the discontinuance of the Property Tax. Such tax should be for one year, and renewed annually, from time to time, until by the evidence of experience, its errors should be discovered, or its benefits realized and felt. It is in vain, at this day, for the funded proprietor to allege that he has been guaranteed an exemption from taxes. That objection might have been urged with reason, when the Property Tax was first imposed. The objection is useless and irrelevant now, when the public creditor has submitted to this part of our system of finance; and the Sinking Fund is sufficient, or nearly sufficient, to annihilate the debt existing, when this system of finance was adopted; so that the amount of unredeemed debt, is a debt contracted by the
public, under a system which assumed that the funded property must contribute towards the emergencies of Government. Nor can placemen, pensioners, and other persons receiving their incomes from Government, justly refuse, or by the public be allowed to refuse, to contribute pari passu. Indeed they ought to contribute, even in a two-fold degree, with those by whom those incomes have been afforded, under the expectation of a different state of things, and of an ability which has failed, of keeping up that scale of payment! One contribution should be as an Income Tax, the other for that part of the income which has been added by mistake.
A well-regulated tax on substantial property, funded debt, &c. would, it is confidently asserted, produce an income to Government equal to the present Property Tax; it would be borne with at least more patience and good humor, because it would fall on that class of persons who are most interested in the general wel fare of the country; some in point of actual interest, and others in point of permanency and security.
It seems a paradox not easily reconcilable with reason, to recommend an additional tax on the income of land, as thus reduced and depreciated; on a property whose value is nearly annihilated. It may be supposed, that instead of relief obtained, a burden will be imposed. This unquestionably is the appearance of the tax at the first view of it. The measure will be reconcilable with reason and sound policy, when it shall be considered, that it is indifferent to the land proprietors, as a body, whether they pay taxes directly or indirectly: they must pay them by indirect means, unless they meet the difficulty by direct taxation; a mode of taxation always to be preferred to one which is indirect, and necessarily creates an actual, though unseen, increase on the consumer, or the person who is ultimately to bear the burthen. Besides, the general welfare of the country must invariably redound to the value of the landed interest, and must, in some shape or other, make them partakers of the benefit.
On this subject there are two papers in the 2nd vol. of the State Tracts, one, page 118, intitled "Taxes no Charge," the other, page 309, intitled "Some Considerations about the most proper way of raising Money in the present Conjuncture." As these papers were written at the establishment of the National Debt, or funding system, and the enactment of a direct land tax, they are particularly deserving of attention. It cannot fail to gratify the writer of these observations, that the sentiments which prevailed at that period, are not materially different from those he has formed at the present crisis. The parts of this work which may subject him to the imputation of plagiarism, he suffers to
remain, not fearing to meet the charge with a protest that he should scorn to use the sentiments of others without a due acknow Jedgment, and a declaration that he has read only for detecting his errors, and not for his matter. The matter, good or bad, is the fruit of his own observation and experience. For a few years also, the income of the sinking fund might aid the resources of the country, and contribute to the relief of the people from the pressure of taxation. The interest of this fund might at least be applied to supersede the necessity of imposing new taxes, and, with this view, to provide the interest for the debt which must be funded, to close the expenses of the war.-It might more properly be made the specific fund for answering that interest, and for gradually Innihilating the principal, or by an application of the sinking fund to the purchase of the loan. This measure would greatly enhance the value of the sinking fund. It is its proper use. Thus applied, and applied also in like manner, as money became abundant, to raise resources for redeeming a reasonable part of the national debt, by loans at the reduced rate of interest, the work of redemption would, with honest and judicious management, proceed rapidly; or it would be rendered unnecessary by the application of the present creditors as a body to reduce the rate of the annuities to the just scale of legal interest; and the taxes might be diminished by a cancellation of part of the debt, and of a corresponding part of the taxes, By an enactment also which would put an end to stock jobbing, or bargains for time, by declaring all contracts. illegal, and placing on them the sanction of penalties, &c., except such as should be carried into effect by an actual transfer within three days, and except such as should be destined for the provision of families, the means would be provided of preventing those. shameful speculations which give an artificial price to funded property. These speculators, like redeemable annuitants, ought not to be allowed to prey upon the public, by a system manifestly against the policy and wisdom of former enactments against stock jobbing.
Besides, these speculators in the funds keep up the rate of interest, by the desperate measures to which they resort of raising money to gamble in the Alley.
It is astonishing that we should deem laws against gaming at cards, hazard, &c., salutary; and yet, for want of a few sanctions of certain efficacy; for example, making all gains precarious, by opening a right to assignees under a commission of bankrupt, and even general creditors or executors, &c., to recover money lost by bargains for time, indulge this the most wicked, injurious, and extensive mode of gambling, and source of false news, &c. &q.
Against these and similar proposals, or any other plan which can be suggested, a diversity of interest, and different systems and habits of thinking, will be fertile in producing innumerable objections. It would be easy to anticipate a large portion of these objections, and of the line of argument which interest will, in particular, dictate. Should that which is most material be urged, the difficulty of obtaining future loans in time of emergency at four per cent, that observation may be easily answered, for if government is not bound by usury laws, its operations are excepted. It will be use ful to consider how former loans have been obtained, and the probability, nay the necessity, of that overflow of disposable money, applicable to the purposes of being invested on this security, if supported by an observance of good faith.
Those who suppose that successive loans to the public are advanced by the great mass of the people, each contributing, as it is alleged, all or a part of his surplus income, will find, that they labor under a great mistake. A very large proportion of every loan is contributed by that very class of the community who con stitute the body of fund-holders. At least half of the loan arises from this source; another and very considerable part is produced by the wealth of those who are engaged in government contracts during the war, and take Exchequer Bills, &c., in payment; and then make these Exchequer Bills, or their produce, a source for investment in the public funds on each loan. Let it also be called to mind, that it is in the nature and habits of the proprie tors of funds, keeping them by way of trade, or of accumulation, to apply the surplus income of each year to the increase of their funded property. The regularity with which they receive their dividends, and the large amount of interest they make of their money, give to these persons, if prudent, (and there is scarcely an instance of a distressed or extravagant fund-holder!) a very considerable surplus of disposable income; and this surplus regularly finds its way in time of war, into new annuities, as they are created by new loans. This system adds very rapidly and certainly to the accumulation and increase of capital. In a war of twenty. years, with a system which funds a new debt every year, the profit of the capital of 1001. employed in the funds, cannot be computed at less than 607., exclusive of interest or the great advantages to be reaped after a peace, and the winding up the expence of the war, from the advance in the funds. All well directed observations must satisfy the scrutinizing mind, that no class of the community so certainly and quickly grow rich as the holders of funded property !! When loans are no longer necessary, this surplus income must
find its application in commerce, or on mortgages, or in the purchase of landed property.
After the expences of the war shall be defrayed, the country will approximate to the condition in which it was found shortly before the commencement of the French Revolution. The abun dance of nominal money will bear so large a proportion to the value of substantial property, and this proportion of the nominal money is now increased, that it will be difficult to find subjects on which this money can be invested; and the less landed property shall rise in value the more will this difficulty be experienced-An extended commerce will have the effect of increasing the circulating medium. Though profiting by the abundance of money, it will not diminish the necessity, or the difficulty of finding a resting place in land, for final investment. On the contrary, the profits of commerce, unless commerce can be increased in a ratio equally progressive with profits, will be in the money market, by way of competition for a subject of investment; and canals and other adventures must, as formerly, become objects of speculadon to take off the superabundance of fluctuating and excessive capital. This is one of the necessary consequences of a circulating medium, generated by nominal capital, and productive of an income which is, in a great degree, nominal and artificial. Then will be the time for a wise administration to avail itself of the situation of the country, to redeem a large portion of the national debt, by creating a new fund for investment, on terms more beneficial to the people. It has already been suggested, that by the reduction of legal interest, the unliquidated expences of the war may be funded on more advantageous terms.
It is obvious that by the reduction of interest of money, persons who afterwards elect to take a funded debt, must accept it on terms corresponding with the reduced rate of interest, more especially as the market for loans in the shape of redeemable annuities will be closed against those who have ready money.
A large proportion of Exchequer Bills may with great utility be kept in the market, in graduated sums, from 100l. to 50001. so as to answer the purposes of circulation, so long as that measure shall be found convenient, and until the holders of these Exchequer Bills shall feel it to be their interest to fund these Exchequer Bills in redeemable annuities at four per cent. on certain terms which should give them the advantage usually allowed to those who aid in loans to the public. The longer these Exchequer Bills shall be kept in the market, the greater facility will the public attain of possessing a circulating medium. These bills will possess over paper of the Bank of England, the advantage of bearing