The Sun.
London, England, 1851-05-10 00:00:00

YORK.. MAY 7.
ST-}o% EXOHANGE.—The transqctions to-day were as
follow:—Caledonian, 15—North-Western, Preference, 13--
York, Newcaetla. and Berwick, Extension, 16t/.—York and
North Midland, 26%.

THE INCONIE-TAX.
(From the Times.)
The labours of the Committee upon the income•tax can
have but one object. It will be their duty to ascertain whe-
ther or no the element of direct taxation is to remain per-

manently incorporated with our fiscal system. Hitherto an
impost of this nature has been the creature of emergency—a
makeshift—an expedient. The subject has never received
so much careful consideration as any single article of the
tariff. Has there been a question of n layi g a differential
duty upon coffee, upon sugar, upon timber7-of relaxing the
,Customs' rate chargeable upon tea or tobacco—and straight.
way blue b oks are compiled, and Chancellors of the Exche-
quer approach the solemn theme in a comprehensive and
philosophical spirit ; the nicest machinery is adjusted , the
moat anxi:us diseriMinition is exercised that everyj. berry,
every lath, every grain, should be affected with its appro-
priate charge, and no more. No , despite of the occasional
complaints of importers and consignees, have the arrange-
meats at the Custom-house failed in their object. Occa-
sional injustice may, no doubt, have been done. Defec-
tive systems of discrimination may for a time have pre-
vailed, but, en the whole, much ingenuity has been
brought to bear upon the subject, and with mani-
fest success. But when we turn to the chapter of
direct taxation we find that the very opposite course
has been pursued. It is start.-ly an exaggeration to say. that
had the Customs been levied upon all imported articles,
simply by reference to their weight, the system could not
have been more wild or unsatisfactory than the pre-ent method
of exacting a per tentage deduction from all incomes without
reference to their sources or their drawbacks. It could
scarcely sound like the proposition of a reasonable being if
any Minister should propose to throw the diamonds from
Brazil and the tubs of sugar from the Antilles into the self-
same scale, and impose upon them an entrance duty accord-
ing to the bare suggestion of the register. It is more rational
to compel the British subjects of the Queen to return to the
assessor the precise amount of the money they can scrape to-
gether in the courze of a current twelvemonth, no matter
how acquired, and to deduct like proportions from all their
incomes? Yet this is actually the course which has been
pursued in a country which, upon all commercial and fiscal
questions at least, affects to stand in the very vanward of
civilization, and in the middle of the nineteenth century,
when all economical problems might fairly be supposed to
have received their solution. Yes, so it is, the bare
ukase of the Finance Minister has been accepted
in place of bestowing any consideration upon
the true difficulties of the case. The result is
a reductio ad absurdum. If this is the best that can be made
of the matter, the obvious inference is, not that we are to
acquiesce in the monstrous inconsistencies of direct taxation
as at present practised in this country, but that we must da
without it altogether. Unless we can smooth down its in-
equalities we must cast from us for ever that soft pillow on
which Chancellors of Exchequer love to doze throughout a
financial year and to dream of a surplus. We must tell them
as we tell careless and extravagant young men, that they
must for the future depend'upon their t- wn resources, for the
patience and sympathy of their friends are fairly at an end.
We start, then, with this proposition, that the application
of the theory of direct taxati In has never been officially
investigated. The knowledge and experience of men versed
in such matters have never been invited to the subject ; nor
can we readily admit that there are any insuperable diffi-
culties inherent in the subject. The daily routine of an in-
surance office offers many more striking problems than can
possibly be involved in an approximation to something like
justice in the assessment of incomes for the purpose of taxa-
tion. The truth is, that the difficulty of levying an equitable
income-tax upon the country consists in ascertaining the
means of those persons who are disposed to baffle inquiry,
not in the framing of four or five categories of li afility. The
difficulty named is in no degree lightened, it is, ou the con-
trary, considerably enhanced by the present system of indis-
criminate levy. It is a great thing to give a man who is
already predisposed to play fast and loose with the assessor
a just and undeniable ground of complaint against the sys-
tem of taxation to which he is subjected. The affair is
simply reduced to a contest of sharp wits. The Finance
Minister says, " I will take all I can get." The taxpayer
replies, " You shall have no help from me." Deception, if
not hallowed, is at least excused. The Treasury is not re-
plenished and the country is demoralised. The, final result,
we most fully believe, is that the tax is not so productive as
it would be did anything like equity prevail in the
method of its assessment. Worse than this, the
minds of the people are kept in a perpetual
condition of discontent and uneasiness. New o'
'.aye very little sympathy is entertained for the
troubles of a Minister or the embarrassments of a party. We
are therefore at any moment exposed to the inconv. nience
of a hotile vote upon a point on which the maintenance of
our public credit depends. We have from time to time ventured
to express a very strong opinion upon the sound policy of tem.
porary—it may be even of permanent—submission to a cer-
tain amount of direct taxation in order that we may reap all
the benefits of a reformed tariff. We are fully sensible that
the time had arrived when amended measures had become a
necessity, and direct taxation was the inevitable expedient.
But here we part company with Sir Charles Wood and his
colleagues. Every argument which tells in favour of direct
taxation at the present period of our political and fiscal his-
tory bears with double force against its unjust assessment.
To say that it should be maintained, is in other words to
enunciate the necessity of an equitable levy. Maintained it
will not be unless some fairer scheme can be devised by the
Committee than the one which actually obtains. The train
of consequences we are most anxious to avoid will then natu-
rally follow as effect follows cause. In arguing the case, we have
hitherto mainly relied upon that feature in it which is the
most revolting to common sense and to the ordinary feeling
of justice. When a man gravely affirms that the owner in
fee-simple of landed property to the value of 1,0001. per
annum, and the professional man who realises a similar sum
during a few precarious years of health and life, should be
equally taxed, there is an end of all argument. You might
as well reason with a Buddhist priest or a Japannese Jum-
maboo upon their peculiar theories of belief. Some of them
base the propriety of the foul assssment upon the extent of
moral evil already in the world. Because there is so much
injustice, there ought to a little more. Others affirm that
all incomes should be taxed alike, because here is question of
an income-tax. It is again affirmed, end with somewhat
more discretion, that even admitting the inequality of the
pressure upon precarious incomes, still incomes of a more
permanent nature are subject to a variety of burdens
from which they are free. Over-weighting on b
ath
sides is the only method of obtaining final equi-
librium. Now, this is the argument of all others against
which we would most earnestly protest, because it proceeds
upon a certain show of reason. We protest against the
clumsy and unphilosophical idea of perpetuating one injus-
tice by the introduction of another. If any bodies of our
fellow subjects are really aggrieved by undue pressure under
our present fiscal system, by all means let their grievances
be remedied. The time has at length arrived when there
must be an end of arrogant assumption on the part of Minis-
ters and of the vague declamation of partisans on ques-
tions of finance. The attention of the most practical and ex-
perienced men in a nation of men of business has for many
y-.ars past been solely occupied in reviewing the duties upon
imports. The point may be said to be disposed of as far as
questions of principle are concerned, and we must now turn
our anenti at elsewhere. If the landowner, the tundowner,
the annuitant, are oppressed with any peculiar burden, now
is the time to put in their claims and to argue its removal
upon its own especial ground. We mus have done for ever
with the miserable make-shift of over-taxing all classes in
turn. Upon the result of the labours of the present Com-
mittee much will depend. If they perform their duty con-
scientiously, we have good hope that at length the general
fiscal system of the country may be fairly reviewed and
justice done to all classes of her Majesty's subjects.
What has been called the harmonious injustice of the in-
come-tax has just been broken into, and one of its notes is
now out of tune. For nine years the Greeks besieged Troy,
and for nine years five schedules of enemies have waged war
against the income-tax, with scarcely a hope of success. In
the tenth year Troy was taken. The wooden horse in the
present instance is the surrender of the principle on which
tenant-farmers are assessed to the tax. Whether owing to
the variable nature of agricultural business, or to the in-
scrutable character of most farming accounts, it has always
been deemed an utter impossibility to assess the annual pro-
fits of a farm in the same way as the annual profits of a pro-
fession or a trade. So to evade the difficulty a principle has
been adored, till now with the entire concurrence of farmers,
of assuming the farmer's profit to be half his rent, and taxing
him threepence-halfpenny in the pound in respect of his oc-
cupation. Till now, we repeat, it has always been thought
that the farmer had the best of the bargain. In average
times it could hardly be doubted that a tenant who
paid a rent of 2501. a year to an ordinary landlord was
about as well cff as a surgeon or a clergyman with
250'. a year from his profession ; but the former paid
no income-tax, and the latter about 71. ss. 10d. By
the same rule, a tenant whose rent was 1,0001. a year, and I
who very probably kept hunters and carriages, paid only as
much income-tax as the man who cleared 5001. from his
profession, and who could not possibly keep more than one
horse and one humble vehicle on such an income. With all
their proverbial addition to grumbling, we must do tenant-
farmers the justice to admit that they have not complained
audibly of the income-tax till the last year or two. The ar-
rangement being in the nature of a composition, and proceed-
/3g upon an assumed average, had a dark side as well as a
ight side, and when the dark side began to show itself com-
plaints were soon heard from Schedule B. Those complaints
were repeated with increasing force till they formed the sub-
ject of various notices in the Commons ; and last night Sir
apparently Charles Wood, frightened by the restriction of the
income-tax to one year, by the approaching Committee of
inquiry, and by Mr. Disraeli's intimation that the case of the
tenant-farmer should not be included in the twelve-months'
truce. proposed and carried a clause releasing the farmer
from the terms of the compromise, now that they seem to go
against him. To tax a man for his profits, when
he has notoriously lost by the transactions a the
year, is, of course, ridiculously unjust, and, thereforue,
little can be said against Sir Charles's concession;
tax
the concession cannot possibly stop here, for the
er
bears far more hardly on other classes than on
th
bones of
like
Taxation, some one said the other night, is
cards touch one, and the whole will come tumblingo)ouch one
But that is especially true of the income-tax. l
schedule, and all the others fall. If the occupier is to be
exempted because he has no profits, surely the landlord has
he
an equal claim to consideration if
if, from any cause, he has cierivedee has received no rent, or
littl or nothing from the
property. Again, the new clause givs the tenant-from
decided advantage over all the classes assessed in Schedule
D. They are bound to return the average of their actual
profits, and, if they
sh, aid be making extraordinary profits
in have no alternative but to take it into
s
in any one year,
account in their return and pay income-tax accordingly. Ac-
cording to the new clause, the tenan.-farmer may always
choose between the th eepence halfpenny a pound in his rent
and his actual profits or absence of profits in any one year. If
in one year be gained double his rent he will be content with
the principle laid down in the Act for Schedule B, and be
returned at an income equal to halt his rent. If the
next year he LA Made bet WI rent, ho will