New-York tribune., 1909-05-10
FREE TRADE DITCHING
Practical Exhaustion of Direct Tar
ati0n-NevC Land I'm posts
London May L

a. tensions b- cs---f7r direct taxation on cur
rent lines 20 ths breaking point The sradoA-
ton OF the income tax Is extended and super
/ taxes on large incomes are added: death sue
cesstoa snd lsSccy duties are heavily increased
sra7,- sr,-fes on stock exchange Transactions
are expanded: the UcUor monopoly IS forced %
give ID a conssde-1bIs proportion of ITS pTof''s
IN licenses. tobacco and spirits are taxed afresh
and motor cars and petrol are rnate rno7e eN-
pensive Injuries About R14C0o.O00 IS raised
/ bv- these means sud with uaoderats suSpen-
sion or the sinking fund service the accounts
are balanced for the year. after provision has
. been made for an experiment IN labor eSc'a0ses
and a new fund for EfIorestatio1 ard rllNlon>AA
+ DEVELOPMENT Tea. sugar and "i0e 8-e -
. changed but otherwise the resources OF FIe7
Tr75s 47a1-s are weIluigh exhausted WIKI N
/ comes paying shilling on the pound i'@0'' 1Vl
fourteen pence and an advance TO eighteen penes
fo- rscafr+z IN excess ot 5000. and with death
111rfes ransfnz, from TO Is Per cert on es'aEeS
direct taxation has been carried as far as -
practicable Yet there will Be eight Dreao-
/ 7orebts in place OF four next year and ths 0io
( age pension is only the beginning OF a costly
/ esrfas OF social reforms. How VIII the money %
raised b. Il Free Trade government 1oF an eU-
1s-red scale OF national expenditures AppSF-
{ entIv from the land This may be dsSeri0sN -
! the last ditch OF Free Trade
/ rsforrners have been striving to tax That 5 20
sav rs value for building sites. mining develop
,+ or other p,lrposes apart from the structures
/ - ,,-,7 If or the uses made OF IT. Munici-
-s1f+fas in Quest % new sources or reVenue l''
NESTING +beir expenditures for local adrrlnistra-
/ ton have favored the principle OF Ta1ius A-
/ values. and bills promoted by them nave oeo"
/ carried 20 second reading y sPeciaI co'ilii
renorted on the advisability Of estao-ishiIS l'NN
local
The liberal government sought to apply '"e
! -~,,ci-Is ~ scotland by forcing land Nalud-
: tfo, hill through the Commons. and the LOTUS
! reiected il The bill when passed a second 'iiil7
J bv the Commons was mutilated oy the LN''Ns
I and withdrawn and similar Dill lot E-ns s'-i-
/ was not pressed. What these measures plOS
T was a new rate on land values apart nom e
/ i1e, rates on buildings occupied ana llleEe Ne4o
rz-ir,rz difficulties IN cases where tenants were
I - ,,,+rac+ IN nav rates in return for re-
! 4,,,ed ren+aIs Land reformers have altered
/ .bsfr line of attack. and have favored ne"
! 1.4 +av IN Mace Of a special rate on Iano
/ ,-,T,ss They have recommended this course as
! n financial reform under cover OF the genera
I budget and have suggested the suostituIon 0l .
new tax for one already existing on the pass u
an obsolete valuation The Chancellor OF 'ii'
/ E,xcheauer. with the best advisers avalIaole @'
Tho Treasury. has been able TO make only
[
! ,ot,+a5 followers are complaining that ne mas
/ not started at ALL but IS merely playing WIN
! the question In reality he has unlocked Ols
I door and Is drawing a throng OF shouters alleF
| him -
/ when Pitt was IN dire straits for money 70
/ carry on war with Napoleon ne converted 'ii'
l oldtfme land tax into a rich source OF revenue
/ 1t was levied at four shilings on ths pounu'
/ with an antiuuated rating; and he onered ad-
~f
large masses Of fresh capital when needed for
I the ir,nrovement OF national credit The rem
/ r7r+ which was not redeemed became rens
! charge and was Incorporated with the draSuo
/ system of income taxation introduced oy tne
! great fnancier. 1t has shruuk from decads u
I decade under subsequent redemptions uutI II
/ now, Yields hardly more than tIO0tcO as prop
artv tax but there is enough or II leiL 10 l'l''
/ - -sser,-a for compulsory redemption Ihe
Economist" has estimated that II coulo oe '0-
/ deemed in two years and the treasury De en-
..bo4 With from Ef6OOOOOO to f2OOOOOOO At
+,t.arty- years purchase or redemption II Wouid
bo a good bargain for the taxpayers. and a large
fund would be accumulated for either naval
construction or the sinking fund Ihis was a
timely suggestion for great financial operation
which would have taken rank with SONS OF
PITTS achievements at the treasury The tenn
rorarv deficiency Of revenues would have been
met with iJtle eHpIL anu "A'l''''1 $780, -
direct taxation. and the Chancellor Of the Ex-
cheauer might have claimed credit for con-
,fncine, demonstration Of the inexhaustibls re-
sources Of Free Trade finance
Mr. Lloyd George has not been fnancfer
graphing with a complex problem Of the Treas
nv so much as Radical politician looking
long way ahead to the possibilities OF coalition
With the Labor party. Not satisfied with in
creasing the exactiors Of direct taxation at ths
exrenee Of the rich. and with producing what fs
called a democratic budget. he has provided for
a conprehensive valuation Of the land IN the
Kingdom. If he has not gone far as land taxer
he has opened the way FOR a new system OF tax
alton at the expense Of large landholders- His
three proposals are a haIfpenny the capital
value Of undeveIoped land and mineral rights
a 10 per cent r.version duty benefit TO the
lessor az the termination ofia lease, and 20 per
/ cent Of the unearned Increment on suburban or
other land which may rise in value. The half
penny is a tax on undeveIoped land. vacant
bufrdfng sites in suburban areas and mining roy
alties and minerals underground. the 40 cent
reyersfou duty is a share in the landnOlder's
profits on property acquired without expendf-
ture. and the % FER cent IS fifth OF the un-
earned increment when property is sold or in
rerited These taxes cannot be levied until
there has been a systematic vaIution % land
Z THROUGHOUT the Kingdom. and consequently only
100000 is set. down IN the budget as the yield
for the fiscal year. That IS only the thin edgs
of the wedge In the green tree It can be driven
q long way when the timber is dry
While land reformers are disappointed be-
cause these taxes are not more drastic they ars
confident that q new source OF revenue OF limit
Ice ~sv.-~s+,- has bzau 0oeued. They assert that