The Sun.
London, England, 1853-01-19 00:00:00

LONDON, WEDNESDAY, JANUARY 19, 1853.

The interesting and important document re-
cently read before the Members of the Statistical
Society, by Dr. WILLIAM FARR, exhibits in the
clearest light the gross and palpable injustice of
the Income Tax now in operation. The Learned
Gentleman unsparingly exposed the fallacies and
inconsistencies of those who advocated the exist-
ing system, contending for the equal taxation of
all receipts, no matter from what source, or in
what manner they might be derived. He also
showed that the entire impost is based on a false
assumption, that it is not what it purports to be,
and that the practical assessment under the Act is
in direct violation of its title !

The original statute 5 and 6 Vic., cap. 35,
which, although originally of limited duration, has
from time to time been renewed, is denominated
" An Act for granting to her MAJESTY Duties on
Profits' arising from property, professions,
trades, and offices." The charge is, therefore, not
merely on " income "—as erroneously supposed—.
it is on "profits," clear and unquestionable " pro-
fits," which leave the original capital embarked in
any investment untouched and unimpaired. The
nse of the word " profits," shows that any-thing
which can be considered in the light of a repay-,
ment of capital does not come within the pur-
view of the statute. It implies that the original
source from whence the profits are derived shall
remain in perpetuity. As Dr. FARR points out,
the meaning of "profits" is exactly the same as
"produce," and represents the additional value
which anything obtains within a certain specified
time. According to his definition, " pro-
duce is expressed by the amount of money
which property yields during the year by an
increase of value, or the use of its services."
Any addition to the actual value of the stock or
property is as much " profit" as the actual money
received for its use ; and, in like manner, any
deterioration from that value reduces the rate of
profit pro tanto.

There cannot be a better illustration than that
adopted by the Learned Gentleman. If a horse-
dealer has a young horse worth 201., the services
of which, 'within the year, bring 101. over and
beyond the cost of keep, &c., and that, during
the same time, the value of the animal becomes
351., the "produce," or " profit," will be not
merely the 10/. gained by his services, but the
101. plus 15/.—the improvement in value, equal
to 251. When the same horse has attained its maxi-
mum of value, supposing that it remains stationary,
the " profit " will be exactly the sum received for
its services ; but if the value be reduced, say from
351. to 301., the amount of the diminution must
be deducted from the money for services to show
the true " profit" of the dealer. The wear and
tear of stock must be taken into account before
the nett proceeds of the business can be ascer-
tained.

~Now, if this be a true statement of the case,l
—and we do not see how it can be controverted—
the injury inflicted on a large proportion of the
tax-paying community will be at once apparent,
and also the distinct " breach of faith" towards
some of the public creditors, viz., the holders of
terminable and rapidly-expiring annuities. Let
US for instance take the case of the holder of
1,0001. per annum in the Long Annuities, which
expire in the year 1860. If he purchasedt
;n:jete of the
in April 1852, the value or cost
the annuity would have been 6,8701.,
while the r
7,7501. eeipts during the 71 years would be
whole h
of that's, manifestly ridiculous to call the
will be only thc. profits. " No, the " profits"
the original capital invnel remaining after replacing
es dcethoantly
at the termination of the
annuity—and that balance
should he taxed.
But in place of acting
manner, they levy on the whole and and equitable
which is the re-payment of capital °lint, on thit—a, that which 1