TOPICS OF THE DAY.
THE CLAMOUR AGAINST THE INCOME-TAX. THE tradesmen of Wolverhampton deserve great credit from politicians. They have what tradesmen when they plunge into politics are so apt to lack, the courage of their opinions. They know what they want in their agitation against the Income-Tax, and they say it straight out, with a contempt for the Eighth Commandment which, considering . the regularity of their attendance in church and chapel, and the value to any dealer of a reputation for honesty, speaks volumes as to the depth of their convictions. They have resolved, in a public meeting presided over by the Mayor, that they want the income-tax under Schedule D entirely and at once repealed,—that is, they want the taxation on everybody else multiplied twofold, in order that taxation may be taken off themselves altogether. They are willing to support any injustice, however great, rather than pay any money, however little. The rich landlord, who already pays rates on his capital, the land, is to contribute a shilling in the pound on his income, in order that the rich brewer, who does not pay rates on his capital, may not pay sixpence on his yearly profits. The rich fundholder is to pay . twofold, in order that the richer shareholder in the Equitable or the London and North-Western Railway may pay nothing at all. The wretched annuitant, the poverty-stricken vicar, the poor free- holder, is to part with five per cent. of his income, in order that the tailor who makes a fortune in ten years, and the draper whose death affects a budget, and the contractor who in one generation accumulates the wealth of a great Peer, may all be exempted from their contribution to the necessities of the State. The man with £100 from his one house is to pay £5 from its rent, in order that the man with £1,000 from a shop may not pay £25. The country yeoman is to lose two five-pound notes out of the forty he may get for his year's work, in order that the physician, who pockets £2,000, may not have to part with £50. The Wolverhampton people will, of course, write to us that they did not mean that, never thought of that, would not be so mean for the world ; but all that, and a great deal worse than that, is implied in the preposterous resolution which on Wednesday was so enthusiastically passed. We must have money from somewhere, and if taxation is not as in old days to be thrown bodily on to the poor, it must in part be direct • and if it is direct and levied on income, then income from business must either be charged, or income from pro- perty must be charged manifold. There is no escape from that conclusion, or from its utter immorality and oppressive- ness. It is open to anybody to say that the Income-Tax is a bad tax, and he wants it repealed, and after saying it he would remain a bad financier, but still an honest man ; but it is not open to anyone to say he wants Schedule D struck out, and still assert that he has no intention of depriving any- body of his own. He is robbing, directly robbing, just as much as Parliament would be, if it declared that everybody named Grosvenor, or everybody with blue eyes, should pay double income-tax on account of those defects. Any tax which falls upon a class only is a confiscating tax, and an exemption can be justified only on one ground, that the expense of collecting would be more than the collection was worth. To exempt Smith at the cost of Brown for any other reason is a robbery of Brown, and nothing else ; and to exempt Brown, who is rich, at the cost of overtaxing Smith, who is poor, is robbery of the most nefarious kind, robbery which would almost justify revolt. The justice of the existing pro- portion between Schedules A and D is, of course, matter for argument and calculation, and has been calculated and argued about for a century, with most marvellous divergence of results ; but that the proportion of nothing and something is not the just proportion needs no proof whatever. Wolverhampton might just as well argue that 0 and 1 were somehow mul- tiples of each other, or expect an answer to this rule-of-three sum,—If A pays nothing and B something, what proportion of A's tax does B pay ?
The people of Wolverhampton have been moved, no doubt, by a local case of oppression to exceptional silliness ; but we confess that this renewed agitation against the Income-Tax, which threatens under the new suffrage to become formidable, excites in us everywhere a feeling almost of anger, it is at once so ignorant and so selfish. What, for example, do the Tiverton people really mean when they coerce their chosen representative into promises which he knows, and they know, and they know that he knows, he neither will nor can perform ? They are a degree less unscru- pulous or less open-hearted than the Wolverhampton men, and do not ask that everybody shall be taxed heavily in order that they themselves shall not be taxed at all, but rather plead that the tax should be swept away altogether and at once. Very good ; but supposing it swept away, how are- they going to replace it ? They may say, probably would say,. that it needs no substitute ; that it might be abolished out of the surplus, or the surplus as it would be after serious reduc- tions. We will grant that inprobability, and still the aboli- tion of the Tax would leave nearly three-fourths of the whole- burden of Imperial taxation upon the shoulders of the poor, who, wonderfully as we have lightened their load, still pay seven-eighths of the Spirit Duties, and of the Malt-Tax, and of the Tobacco Duties, and of the liquor licences, and of the Tea and Sugar Duties, and, in fact, of every impost except the Stamp Duties, the Wine Duties, the House Duty, and the Succession Duties in their three forms. Is that fair, or merciful, or, with a constitution like ours, practicable for any length of time ? It is nonsense to say that, as we have repealed the Corn Laws and do not tax meat, these articles under duty are all luxuries with which the poor may reasonably dispense, are indulgences for which they ought to pay higher. • Man does- not live by bread alone, socially any more than theologically,. and the majority of these articles—all of them, except, per- haps, spirits—are needful to that comfortable existence of the body of the people, without which no State can be safe, or powerful, or well-ordered. The artisan wants his malt just as much as the tradesman his meat, and for just the same reason,. that in moderation it makes him at once healthier and better contented with his lot. Are the Tiverton men really prepared to break up the compact under which the prosperous in England have agreed that in consideration of the extra demands made by the possessors of income on the State, and the extra advantage- they enjoy from social security, they shall put an extra burden on their own shoulders, shall allow incomes to be taxed as well as persons. Baron Rothschild can drink no more beer than a messenger in his office, but he wants a good deal more spent for him to ensure his social security. If they are so prepared, we can tell them they are giving up the best guarantee for social safety ever devised, the visible and undeniable fairness of our taxation' but, of course, they will answer they are not, that still they sti want to keep the balance equal by substituting some- other direct tax for this particularly annoying one. Well, that is just enough, and reduces the question merely to one or sound finance ; but what. is their favourite tax to be ? Have• they got a tax which will draw like the Income-Tax, and be- perfectly fair, and hurt nobody to squeaking-point, and cost. very little in collection, and injure no great trade, and possess; every other requisite of a really popular and satisfactory impost ? If they have, they should forward their idea at once- to Mr. Gladstone, who would be only too delighted to consider a proposition so pleasing ; but for ourselves, we are hopelessly at a loss to discover what it may be. When the State does- not own the land, no fair direct tax except an income-tax ever draws a large revenue. A tax on rental will not do, because that would be merely the Income-Tax minus Schedule D, that is, would be unjust, and would also upset all our municipal arrange- ments, which would be inexpedient. A tax on successions would' be just, but it would not draw sufficiently, for three reasons. It would be fiercely resisted because of its cruelty to all families under Schedule D, 20 per cent. say, of their property being taken away just at the moment when they have lost perhaps, 40 per cent. of their income by the death of the bread-winner; it would be evaded by the investment of all heavy savings in foreign countries unburdened with such a tax ; and it would be use- less in war time, because legislators would refuse to throw the expense of a war on the families deprived of their chiefs in that particular year instead of on an entire community. Suc- cession duties may be fixed at any rates ; but to be just, they must fluctuate very seldom, for if they are 20 per cent. in 1872, and 10 per cent. in 1873, the families stricken in 1872 are unjustly treated. All must die, but all do not die in a particular year. A severe transfer duty might be a substitute for the Income-Tax, as it is in France ; but there is no con- ceivable reason why it should be placed on land and houses' alone, and if placed upon all property it would impede trade almost as much as the old Excise Duties did, would act• as a protective tariff in favour of all foreign traders. A perty-tax is conceivable, though it would not work well ut a property-tax, like an income-tax, must have its Schedule , and its inquisitorial process, and its occasional injustices, 'th the additional drawback that property invested, say in France, would escape. There is in fact no form of direct taxation which will draw so readily as the Income-Tax, which can be modified so rapidly, and with so little in- justice, which presses so lightly on the sources of prosperity, or which when carefully arranged—a point upon which im- provement is still possible—is so roughly fair. Of course, it is an " inquisitorial tax," and a worrying tax, and in some instances an oppressive tax, but there are very few direct taxes indeed to which some of those epithets do not apply. After all, the old joke that it is the only tax in existence of which everybody wishes he paid more involves a very sub- stantial reason in its favour, while many of its more annoying incidents might be removed by a little administrative care. We do not see, for example, why it should be so difficult and disagreeable to appeal, why the appeal should not be always to an official of experience instead of a local body, or why it should be impossible to accept returns at longer intervals than a year, say, for example, three years. Nor are we certain that it would be impossible to graduate the tax on the principle adopted both by Lord Palmerston and Mr. Lowe, and defended by Mr. Mill, so as to relieve necessary income of its weight ; but these are all improvements of detail which might be carried, which would lighten the severity of the tax, and which therefore the philosophers of Wolverhampton and Tiverton despise. They want a relief which shall be sweeping and summary, and seem to think that statesmen can get rid of the Income-Tax, which they require to maintain the equilibrium of our taxation and as a reserve of power, just as easily as they could lower a tea duty or take off sixpence a gallon from wine. In fact, they know nothing about finance, and are only savage because they feel with Punch, that just now "there is one thing dearer than Life, and that is Living."
Previous page
