The Sun.
London, England, 1844-04-08 00:00:00

MONEY. t',.I4IIKET and CITY NEWS.
TlMES.—rhe project which at the last 'meeting-of
Proprietors of, South Sea Stock was announced to be its
contemplation, was made known this morning. Propo-
sals are now made to form a public company, to consist
of Proprietors of South Sea Stock, for the execution of
trusts, and to be culled the " Trust Company." Snell
portions of capital stock of the. South Sea Company as
the Proprietors may think proper to subscriber-notless
in amount than ()(),0001., are to be set apart as a gnu-
rantee fund.-- This fund will be open to contribution by
such Proprietors-until six months after notice shall have
been given of the'conainencement of buiiness,' but after
tb-it period, subscribers will hate to pay in addition the
difference in value between the original stock -end the
trust capital stock. The fund so subscribed will be tin=
der the management of the present Directors or ex-
Directors of the South Sea Company, and will consist of
a Chairman, Deputy-Chairman, and .nine other Direc-
tors. The business of the intended Company to be
carried on atthe South Sea house or elsewhere, as the
provisional Committee or Directors may decide. The
liability of the subscribers to be limited to the amount
of the guarantee .fund, but it is distinctly understood
that the trust funds deposited are in- no. way liable for
any general losS. It is proposed to undertake in the
first instance' such trusts only as relate to personal
estate, and all property held in trust will be invested in
the names of trustees to be appointed by the Directors.
A commission is to be charged on the amount adminis
tered according to a 'scale-to bp fixe& hereafter. All in-
vestments of trust. property to :be in Government funds, ,
or in South Sea Annuities, or in real seeurities, unless
otherwise directed by theily.ust. A deed of snttletocatis
to be prepared for ,carrying these and other objects con-
nected with -the management of the propOsedWmpany
into effect.
The income-tax does - not press more severely, or
rather unjastly, :in any quarter, than upon. the in-
surance companies. . Tt.ya. well known- that these in-
stitutions of inecessity pay income-tax by deduction
upon a sum far beyond -their profits-; for all their•
income is taxed, and a part only is profit. -The busi-
ness of life insurance consists in investing the pre-
miums received, and accumulating them at compound ,
interest, to meet future losses. This accumulation
of the income of their investments is the basis of a safe
or prosperous career, for an office that should treat this
income as profit, and divide it among the parties inter-
ested, would infallibly soon become bankrupt. Yet as
the investments are either in the fune.ssor mortgages, the
whole income is taxed by deduction as if it were profit,
and the- offices pay, consequently, much more than they
ought.
The practical working of this has turned out even
worse than the theory, for many of them have recently
had notices of surcharge from the surveyor. They ap-
pealed, most of them,-to the Commissioners for general
purposes, who, being men of business, and knowing
something of life insurance, immediately relieved them.
Others have appealed to the Special Commissioners ap-
pointed by Government, and have been subjected to
great annoyance in so doing, for though it is made ap-
parent enough that an office has paid the tax on a sum
far exceeding the entire profits arising from every source,
the Special Commissioners endeavour to impose a
further tax, on the allegation that there is a profit-apart
from the income of investment. From the complicated
nature of life insurance accounts, the offices are neces-
sarily exposed to great trouble and inconvenience-in the
detailed investigation to which they are subject under
this impression, which is of course a fallacious one.
The case is exciting the more attention in the City,
because it is one of a class embracing banks and other
investment companies, where, by the. machinery of the
Act, parties are made, by deduction, to pay a tax greatlY
beyond the rate professed to be imposed by Parliament,
and for this the Act affords no remedy.
This form of taxation, hard enough when -it is im-
posed tacitly by deduction from income, becomes offen-
sive and oppressive when sought to be actively enforced
and extended by the Government officers.

A correspondent offers a suggestion to the Chancellor
of the Exchequer, connected with the management of
the public debt, somewhat startling perhaps, but which
there can be no harm in letting go to the world-at large.
By the means pointed out, and without the imposition
of a single fresh tax, he anticipotes the "entire liquida-
tion of the national debt." This is to be accomplished
solely by the aid of the,money saved, and to be saved,
by the reduction of the Three-and-a-Half per Cents., to
be applied exclusively
,to the redemption of the debt
(say at par), and allowed to accumulate at compound in-
terest. He estimates that, in 95 years, the whole debt
of 800,000,0001. may by such means be paid off; but
that, if this course is persevered in, the fund-holders
will probably be glad to accede to a further reduction of •
interest, and these savings being applied in the like
manner, the liquidation might be completed in 50 years,
or less. Great glory would, as this writer thinks,
redound to the statesman who planned, and great
strength to the country which executed, so magnificent
a project ; but the difficulties which beset it are, we fear,
insuperable. Not to mention the necessity it involves of
perpetuating the income-tax, to which alone the present
surplus of revenue is owing, and for the relief from which
all persons are eagerly looking to this and other sources
of saving, it is a delusion to suppose that any course of
financial policy can be persevered in during 50 years, or
during one half of that time. This is the old error into
which Mr. Pitt fell, in regard to his wonder-working
sinking fund, and it is but a few years since that states-
men have arrived at the conviction that a sinking fund
cannot subsist by borrowing, and that its only legitiniate
basis is a surplus of income over expenditure. This, it
is true, the writer in question contemplates, but then he
must keep on the income-tax, which will not be tolerated
at all, or, at any rate, for such a purpose.