The Louisiana Democrat. [volume] (Alexandria, La.) 1845-1918, 1890-05-14
THE CANYONS OF TAXATION.
Ear Marks Whereby to Distinguish Good
From Bad Taxes.

Ear MarKS whereby 60 Distinguish 6Oou
From Bad Taxes.
All taxes must evidently come from
the produce of land and labor, since
there is no other source of wealth than
the union of human exertion with the
material and forces of nature. But the
manner in which equal amounts of tax
alton may be imposed may very differ
entity affect the production of wealth.
Taxation which lessons the reward of
the producer necessarily lessons the in
centive to production; taxation which is
conditioned upon the act of production,
or the use of any of the three factors of
production, necessarily discourages pro-
duction. Thus, taxation which dimin-
ishes the earnings of the laborer Or the
returns of the capitalist tends to render
the one less Industrious and intelligent,
the other less disposed to save and in
processes of production interposes an
artificial obstacle to the creation of
wealth. Taxation which falls upon
labor as it is exerted, wealth as it is
used as capital, land as it is cultivated,
will manifestly tend to discourage pro-
duction much more powerfully than
taxation to the same amount levied
upon laborers, whether they work Or
play, upon wealth whether. used pro-
ductively or unproductively or upon
land whether cultivated or left waste.
The mode Of taxation is, in fact, quite
as important as the amount. Asa small
burden badly placed may distress a
horse that could carry with ease much
larger one properly adjusted, SO people
may be impoverished and their power OF
producing wealth destroyed by taxation,
which, if levied in another way, could
be borne with ease, A tax on date trees,
imposed by Mohammed Ali, caused the
Egyptian fellahs to cut down their trees;
but a tax of twice the amount imposed
on the land produced no such result.
The tax of 10 per cent. on all sales, i'm
posed by the Duke of Alva in the Neither
lands, would, had been maintained,
have all but stopped exchange while
yielding but little revenue.
But we need not go abroad for illus
trations. The production of wealth in
the United States is largely lessened by
taxation, which bears upon its pro-
cesses. Ship building, in which we ex-
oo11o1 hoe Ioa,, oil hut
far as the foreign trade is concerned,
and many branches of production and
exchange seriously crippled, by taxes
which divert industry from more to less
productive forms.
This checking of production is in
greater or less degree characteristic OF
most Of the taxes by which the revenues
of modern government are raised. All
taxes upon manufactures, all taxes upon
commerce, all taxes upon capital, all
taxes upon improvements are of this
kind. Their tendency is the same as
that of Mohammed Ais tax on date
trees, though their effect may not be so
clearly seen.
All such taxes have tendency to
reduce the production of wealth, and
should, therefore, never be resorted to
when it is possible to raise money by
taxes which do not check production.
This becomes possible as society de-
velops and wealth accumulates. Taxes
which fall upon ostentation would sim
ply turn into the public treasury what
otherwise would be wasted in vain show
for tho sake of show; and taxes upon
wills and devises of the rich would
probably have little effect in checking
the desire for accumulation which, after
it has fairly got hold of a man, becomes
a blind passion. But the great class of
taxes from which revenue may be de-
rived without interference with produc-
ton are taxes upon monopolies-fo the
profit of monopoly is in itself a tax
levied upon production, and to tax it is
simply to divert into the public Golfers
what production must in any event pay.
But all other monopolies are trivial in
extent as compared with the monopoly
of land. And the value of land ex-
pressing monopoly, pure and simple,
is in every respect fitted for taxation.
Taxes levied upon the value of land
cannot check production in the slightest
degree until they exceed rent, or the
value of land taken annually, for, I'M
like taxes upon commodities, or ex-
change, or capital, or any of the tools or
processes of production, they do not
bear upon production. The value of
land does not express the reward of
production, as does the value of crops,
of cattle, of buildings, or any of the
things which are styled personal prop
erty and improvements. 1t expresses
the exchange value Of monopoly. 1t is
not in any case the creation of the in
dividual who owns the land; it is created
by the growth of the community. Hence
the community can take it all without
in any way lessening the incentive to
improvement or in the slightest degree
lessening the production of wealth.
Taxes may be imposed upon the value
of land until all rent is taken by the
State, without reducing the wages of
labor or the reward of capital one iota;
without increasing the price of single
commodity, or making production in any
way more difficult.
But more than this. Taxes on the