While property remains in the possession of the same person, whatever permanent taxes may have been imposed upon it, they have never been intended to diminish or take away any part of its capital value, but only some part of the revenue arising from it.

But when property changes hands, when it is transmitted either from the dead to the living, or from the living to the living, such taxes have frequently been imposed upon it as necessarily take away some part of its capital value.

 The transference of all sorts of property from the dead to the living, and that of immoveable property of land and houses from the living to the living, are transactions which are in their nature either public and notorious, or such as cannot be long concealed.

Such transactions, therefore, may be taxed directly.

The transference of stock or moveable property, from the living to the living, by the lending of money, is frequently a secret transaction, and may always be made so.

It cannot easily, therefore, be taxed directly.

It has been taxed indirectly in two different ways;

first, by requiring that the deed, containing the obligation to repay, should be written upon paper or parchment which had paid a certain stamp duty, otherwise not to be valid;

secondly, by requiring, under the like penalty of invalidity, that it should be recorded either in a public or secret register, and by imposing certain duties upon such registration.

Stamp duties, and duties of registration, have frequently been imposed likewise upon the deeds transferring property of all kinds from the dead to the living, and upon those transferring immoveable property from the living to the living;

transactions which might easily have been taxed directly.

 The vicesima hereditatum, or the twentieth penny of inheritances, imposed by Augustus upon the ancient Romans, was a tax upon the transference of property from the dead to the living.

Dion Cassius, { Lib. 55. See also Burman. de Vectigalibus Pop. Rom. cap. xi. and Bouchaud de l’impot du vingtieme sur les successions.} the author who writes concerning it the least indistinctly, says, that it was imposed upon all successions, legacies and donations, in case of death, except upon those to the nearest relations, and to the poor.

 Of the same kind is the Dutch tax upon successions. {See Memoires concernant les Droits, etc.

tom i, p. 225.}

Collateral successions are taxed according to the degree of relation, from five to thirty per cent.

upon the whole value of the succession.

Testamentary donations, or legacies to collaterals, are subject to the like duties.

Those from husband to wife, or from wife to husband, to the fiftieth penny.

The luctuosa hereditas, the mournful succession of ascendants to descendants, to the twentieth penny only.

Direct successions, or those of descendants to ascendants, pay no tax.

The death of a father, to such of his children as live in the same house with him, is seldom attended with any increase, and frequently with a considerable diminution of revenue;

by the loss of his industry, of his office, or of some life-rent estate, of which he may have been in possession.

That tax would be cruel and oppressive, which aggravated their loss, by taking from them any part of his succession.

It may, however, sometimes be otherwise with those children, who, in the language of the Roman law, are said to be emancipated;

in that of the Scotch law, to be foris-familiated; that is, who have received their portion, have got families of their own, and are supported by funds separate and independent of those of their father.

Whatever part of his succession might come to such children, would be a real addition to their fortune, and might, therefore, perhaps, without more inconveniency than what attends all duties of this kind, be liable to some tax.

The casualties of the feudal law were taxes upon the transference of land, both from the dead to the living, and from the living to the living.

In ancient times, they constituted, in every part of Europe, one of the principal branches of the revenue of the crown.

 The heir of every immediate vassal of the crown paid a certain duty, generally a year’s rent, upon receiving the investiture of the estate.

If the heir was a minor, the whole rents of the estate, during the continuance of the minority, devolved to the superior, without any other charge besides the maintenance of the minor, and the payment of the widow’s dower, when there happened to be a dowager upon the land.

When the minor came to be of age, another tax, called relief, was still due to the superior, which generally amounted likewise to a year’s rent.

A long minority, which, in the present times, so frequently disburdens a great estate of all its incumbrances, and restores the family to their ancient splendour, could in those times have no such effect.

The waste, and not the disincumbrance of the estate, was the common effect of a long minority.

 By a feudal law, the vassal could not alienate without the consent of his superior, who generally extorted a fine or composition on granting it.

This fine, which was at first arbitrary, came, in many countries, to be regulated at a certain portion of the price of the land.

In some countries, where the greater part of the other feudal customs have gone into disuse, this tax upon the alienation of land still continues to make a very considerable branch of the revenue of the sovereign.

In the canton of Berne it is so high as a sixth part of the price of all noble fiefs, and a tenth part of that of all ignoble ones. {Memoires concernant les Droits, etc, tom.i p.154}

In the canton of Lucern, the tax upon the sale of land is not universal, and takes place only in certain districts.

But if any person sells his land in order to remove out of the territory, he pays ten per cent.

upon the whole price of the sale. {id. p.157.}

Taxes of the same kind, upon the sale either of all lands, or of lands held by certain tenures, take place in many other countries, and make a more or less considerable branch of the revenue of the sovereign.

 Such transactions may be taxed indirectly, by means either of stamp duties, or of duties upon registration;

and those duties either may, or may not, be proportioned to the value of the subject which is transferred.

 In Great Britain, the stamp duties are higher or lower, not so much according to the value of the property transferred (an eighteen-penny or half-crown stamp being sufficient upon a bond for the largest sum of money), as according to the nature of the deed.

The highest do not exceed six pounds upon every sheet of paper, or skin of parchment;

and these high duties fall chiefly upon grants from the crown, and upon certain law proceedings, without any regard to the value of the subject.

There are, in Great Britain, no duties on the registration of deeds or writings, except the fees of the officers who keep the register;

and these are seldom more than a reasonable recompence for their labour.

The crown derives no revenue from them.

 In Holland {Memoires concernant les Droits, etc.

tom. i. p 223, 224, 225.} there are both stamp duties and duties upon registration;

which in some cases are, and in some are not, proportioned to the value of the property transferred.

All testaments must be written upon stamped paper, of which the price is proportioned to the property disposed of;

so that there are stamps which cost from three pence or three stivers a-sheet, to three hundred florins, equal to about twenty-seven pounds ten shillings of our money.

If the stamp is of an inferior price to what the testator ought to have made use of, his succession is confiscated.

This is over and above all their other taxes on succession.

Except bills of exchange, and some other mercantile bills, all other deeds, bonds, and contracts, are subject to a stamp duty.

This duty, however, does not rise in proportion to the value of the subject.

All sales of land and of houses, and all mortgages upon either, must be registered, and, upon registration, pay a duty to the state of two and a-half per cent.

upon the amount of the price or of the mortgage.

This duty is extended to the sale of all ships and vessels of more than two tons burden, whether decked or undecked.

These, it seems, are considered as a sort of houses upon the water.

The sale of moveables, when it is ordered by a court of justice, is subject to the like duty of two and a-half per cent.

 In France, there are both stamp duties and duties upon registration.

The former are considered as a branch of the aids of excise, and, in the provinces where those duties take place, are levied by the excise officers.

The latter are considered as a branch of the domain of the crown and are levied by a different set of officers.

 Those modes of taxation by stamp duties and by duties upon registration, are of very modern invention.

In the course of little more than a century, however, stamp duties have, in Europe, become almost universal, and duties upon registration extremely common.

There is no art which one government sooner learns of another, than that of draining money from the pockets of the people.

 Taxes upon the transference of property from the dead to the living, fall finally, as well as immediately, upon the persons to whom the property is transferred.

Taxes upon the sale of land fall altogether upon the seller.

The seller is almost always under the necessity of selling, and must, therefore, take such a price as he can get.

The buyer is scarce ever under the necessity of buying, and will, therefore, only give such a price as he likes.

He considers what the land will cost him, in tax and price together.

The more he is obliged to pay in the way of tax, the less he will be disposed to give in the way of price.

Such taxes, therefore, fall almost always upon a necessitous person, and must, therefore, be frequently very cruel and oppressive.

Taxes upon the sale of new-built houses, where the building is sold without the ground, fall generally upon the buyer, because the builder must generally have his profit;

otherwise he must give up the trade.

If he advances the tax, therefore, the buyer must generally repay it to him.

Taxes upon the sale of old houses, for the same reason as those upon the sale of land, fall generally upon the seller;

whom, in most cases, either conveniency or necessity obliges to sell.

The number of new-built houses that are annually brought to market, is more or less regulated by the demand.

Unless the demand is such as to afford the builder his profit, after paying all expenses, he will build no more houses.

The number of old houses which happen at any time to come to market, is regulated by accidents, of which the greater part have no relation to the demand.

Two or three great bankruptcies in a mercantile town, will bring many houses to sale, which must be sold for what can be got for them.

Taxes upon the sale of ground-rents fall altogether upon the seller, for the same reason as those upon the sale of lands.

Stamp duties, and duties upon the registration of bonds and contracts for borrowed money, fall altogether upon the borrower, and, in fact, are always paid by him.

Duties of the same kind upon law proceedings fall upon the suitors.

They reduce to both the capital value of the subject in dispute.

The more it costs to acquire any property, the less must be the neat value of it when acquired.

 All taxes upon the transference of property of every kind, so far as they diminish the capital value of that property, tend to diminish the funds destined for the maintenance of productive labour.

They are all more or less unthrifty taxes that increase the revenue of the sovereign, which seldom maintains any but unproductive labourers, at the expense of the capital of the people, which maintains none but productive.

 Such taxes, even when they are proportioned to the value of the property transferred, are still unequal;

the frequency of transference not being always equal in property of equal value.

When they are not proportioned to this value, which is the case with the greater part of the stamp duties and duties of registration, they are still more so.

They are in no respect arbitrary, but are, or may be, in all cases, perfectly clear and certain.

Though they sometimes fall upon the person who is not very able to pay, the time of payment is, in most cases, sufficiently convenient for him.

When the payment becomes due, he must, in most cases, have the more to pay.

They are levied at very little expense, and in general subject the contributors to no other inconveniency, besides always the unavoidable one of paying the tax.

In France, the stamp duties are not much complained of.

Those of registration, which they call the Controle, are.

They give occasion, it is pretended, to much extortion in the officers of the farmers-general who collect the tax, which is in a great measure arbitrary and uncertain.

In the greater part of the libels which have been written against the present system of finances in France, the abuses of the controle make a principal article.

Uncertainty, however, does not seem to be necessarily inherent in the nature of such taxes.

If the popular complaints are well founded, the abuse must arise, not so much from the nature of the tax as from the want of precision and distinctness in the words of the edicts or laws which impose it.

 The registration of mortgages, and in general of all rights upon immoveable property, as it gives great security both to creditors and purchasers, is extremely advantageous to the public.

That of the greater part of deeds of other kinds, is frequently inconvenient and even dangerous to individuals, without any advantage to the public.

All registers which, it is acknowledged, ought to be kept secret, ought certainly never to exist.

The credit of individuals ought certainly never to depend upon so very slender a security, as the probity and religion of the inferior officers of revenue.

But where the fees of registration have been made a source of revenue to the sovereign, register-offices have commonly been multiplied without end, both for the deeds which ought to be registered, and for those which ought not.

In France there are several different sorts of secret registers.

This abuse, though not perhaps a necessary, it must be acknowledged, is a very natural effect of such taxes.

 Such stamp duties as those in England upon cards and dice, upon newspapers and periodical pamphlets, etc.

are properly taxes upon consumption;

the final payment falls upon the persons who use or consume such commodities.

Such stamp duties as those upon licences to retail ale, wine, and spiritous liquors, though intended, perhaps, to fall upon the profits of the retailers, are likewise finally paid by the consumers of those liquors.

Such taxes, though called by the same name, and levied by the same officers, and in the same manner with the stamp duties above mentioned upon the transference of property, are, however, of a quite different nature, and fall upon quite different funds.

 ARTICLE III.—Taxes upon the Wages of Labour.

 The wages of the inferior classes of work men, I have endeavoured to show in the first book are everywhere necessarily regulated by two different circumstances;

the demand for labour, and the ordinary or average price of provisions.

The demand for labour, according as it happens to be either increasing stationary or declining;

or to require an increasing, stationary, or declining population, regulates the subsistence of the labourer, and determines in what degree it shall be either liberal, moderate, or scanty.

The ordinary average price of provisions determines the quantity of money which must be paid to the workman, in order to enable him, one year with another, to purchase this liberal, moderate, or scanty subsistence.

While the demand for the labour and the price of provisions, therefore, remain the same, a direct tax upon the wages of labour can have no other effect, than to raise them somewhat higher than the tax.

Let us suppose, for example, that, in a particular place, the demand for labour and the price of provisions were such as to render ten shillings a-week the ordinary wages of labour;

and that a tax of one-fifth, or four shillings in the pound, was imposed upon wages.

If the demand for labour and the price of provisions remained the same, it would still be necessary that the labourer should, in that place, earn such a subsistence as could be bought only for ten shillings a-week; so that, after paying the tax, he should have ten shillings a-week free wages.

But, in order to leave him such free wages, after paying such a tax, the price of labour must, in that place, soon rise, not to twelve shillings a week only, but to twelve and sixpence;

that is, in order to enable him to pay a tax of one-fifth, his wages must necessarily soon rise, not one-fifth part only, but one-fourth.

Whatever was the proportion of the tax, the wages of labour must, in all cases rise, not only in that proportion, but in a higher proportion.

If the tax for example, was one-tenth, the wages of labour must necessarily soon rise, not one-tenth part only, but one-eighth.

 A direct tax upon the wages of labour, therefore, though the labourer might, perhaps, pay it out of his hand, could not properly be said to be even advanced by him;

at least if the demand for labour and the average price of provisions remained the same after the tax as before it.

In all such cases, not only the tax, but something more than the tax, would in reality be advanced by the person who immediately employed him.

The final payment would, in different cases, fall upon different persons.

The rise which such a tax might occasion in the wages of manufacturing labour would be advanced by the master manufacturer, who would both be entitled and obliged to charge it, with a profit, upon the price of his goods.

The final payment of this rise of wages, therefore, together with the additional profit of the master manufacturer would fall upon the consumer.

The rise which such a tax might occasion in the wages of country labour would be advanced by the farmer, who, in order to maintain the same number of labourers as before, would be obliged to employ a greater capital.

In order to get back this greater capital, together with the ordinary profits of stock, it would be necessary that he should retain a larger portion, or, what comes to the same thing, the price of a larger portion, of the produce of the land, and, consequently, that he should pay less rent to the landlord.

The final payment of this rise of wages, therefore, would, in this case, fall upon the landlord, together with the additional profit of the farmer who had advanced it.

In all cases, a direct tax upon the wages of labour must, in the long-run, occasion both a greater reduction in the rent of land, and a greater rise in the price of manufactured goods than would have followed from the proper assessment of a sum equal to the produce of the tax, partly upon the rent of land, and partly upon consumable commodities.

 If direct taxes upon the wages of labour have not always occasioned a proportionable rise in those wages, it is because they have generally occasioned a considerable fall in the demand of labour.

The declension of industry, the decrease of employment for the poor, the diminution of the annual produce of the land and labour of the country, have generally been the effects of such taxes.

In consequence of them, however, the price of labour must always be higher than it otherwise would have been in the actual state of the demand;

and this enhancement of price, together with the profit of those who advance it, must always be finally paid by the landlords and consumers.

 A tax upon the wages of country labour does not raise the price of the rude produce of land in proportion to the tax;

for the same reason that a tax upon the farmer’s profit does not raise that price in that proportion.

 Absurd and destructive as such taxes are, however, they take place in many countries.

In France, that part of the taille which is charged upon the industry of workmen and day-labourers in country villages, is properly a tax of this kind.

Their wages are computed according to the common rate of the district in which they reside;

and, that they may be as little liable as possible to any overcharge, their yearly gains are estimated at no more than two hundred working days in the year. {Memoires concernant les Droits, etc.

tom. ii. p. 108.}

The tax of each individual is varied from year to year, according to different circumstances, of which the collector or the commissary, whom intendant appoints to assist him, are the judges.

In Bohemia, in consequence of the alteration in the system of finances which was begun in 1748, a very heavy tax is imposed upon the industry of artificers.

They are divided into four classes.

The highest class pay a hundred florins a year, which, at two-and-twenty pence half penny a-florin, amounts to £9:7:6.

The second class are taxed at seventy;

the third at fifty;

and the fourth, comprehending artificers in villages, and the lowest class of those in towns, at twenty-five florins. {Memoires concernant les Droits, etc.

tom. iii. p. 87.}

 The recompence of ingenious artists, and of men of liberal professions, I have endeavoured to show in the first book, necessarily keeps a certain proportion to the emoluments of inferior trades.

A tax upon this recompence, therefore, could have no other effect than to raise it somewhat higher than in proportion to the tax.

If it did not rise in this manner, the ingenious arts and the liberal professions, being no longer upon a level with other trades, would be so much deserted, that they would soon return to that level.

 The emoluments of offices are not, like those of trades and professions, regulated by the free competition of the market, and do not, therefore, always bear a just proportion to what the nature of the employment requires.

They are, perhaps, in most countries, higher than it requires;

the persons who have the administration of government being generally disposed to regard both themselves and their immediate dependents, rather more than enough.

The emoluments of offices, therefore, can, in most cases, very well bear to be taxed.

The persons, besides, who enjoy public offices, especially the more lucrative, are, in all countries, the objects of general envy;

and a tax upon their emoluments, even though it should be somewhat higher than upon any other sort of revenue, is always a very popular tax.

In England, for example, when, by the land-tax, every other sort of revenue was supposed to be assessed at four shillings in the pound, it was very popular to lay a real tax of five shillings and sixpence in the pound upon the salaries of offices which exceeded a hundred pounds a-year; the pensions of the younger branches of the royal family, the pay of the officers of the army and navy, and a few others less obnoxious to envy, excepted.

There are in England no other direct taxes upon the wages of labour.

 ARTICLE IV.—Taxes which it is intended should fall indifferently upon every different Species of Revenue.

 The taxes which it is intended should fall indifferently upon every different species of revenue, are capitation taxes, and taxes upon consumable commodities.

Those must be paid indifferently, from whatever revenue the contributors may possess;

from the rent of their land, from the profits of their stock, or from the wages of their labour.

 Capitation Taxes.

 Capitation taxes, if it is attempted to proportion them to the fortune or revenue of each contributor, become altogether arbitrary.

The state of a man’s fortune varies from day to day;

and, without an inquisition, more intolerable than any tax, and renewed at least once every year, can only be guessed at.

His assessment, therefore, must, in most cases, depend upon the good or bad humour of his assessors, and must, therefore, be altogether arbitrary and uncertain.

 Capitation taxes, if they are proportioned, not to the supposed fortune, but to the rank of each contributor, become altogether unequal;

the degrees of fortune being frequently unequal in the same degree of rank.

 Such taxes, therefore, if it is attempted to render them equal, become altogether arbitrary and uncertain;

and if it is attempted to render them certain and not arbitrary, become altogether unequal.

Let the tax be light or heavy, uncertainty is always a great grievance.

In a light tax, a considerable degree of inequality may be supported;

in a heavy one, it is altogether intolerable.

 In the different poll-taxes which took place in England during the reign of William III. the contributors were, the greater part of them, assessed according to the degree of their rank;

as dukes, marquises, earls, viscounts, barons, esquires, gentlemen, the eldest and youngest sons of peers, etc.

All shop-keepers and tradesmen worth more than three hundred pounds, that is, the better sort of them, were subject to the same assessment, how great soever might be the difference in their fortunes.

Their rank was more considered than their fortune.

Several of those who, in the first poll-tax, were rated according to their supposed fortune were afterwards rated according to their rank.

Serjeants, attorneys, and proctors at law, who, in the first poll-tax, were assessed at three shillings in the pound of their supposed income, were afterwards assessed as gentlemen.

In the assessment of a tax which was not very heavy, a considerable degree of inequality had been found less insupportable than any degree of uncertainty.

 In the capitation which has been levied in France, without-any interruption, since the beginning of the present century, the highest orders of people are rated according to their rank, by an invariable tariff;

the lower orders of people, according to what is supposed to be their fortune, by an assessment which varies from year to year.

The officers of the king’s court, the judges, and other officers in the superior courts of justice, the officers of the troops, etc are assessed in the first manner.

The inferior ranks of people in the provinces are assessed in the second.

In France, the great easily submit to a considerable degree of inequality in a tax which, so far as it affects them, is not a very heavy one;

but could not brook the arbitrary assessment of an intendant.

 The inferior ranks of people must, in that country, suffer patiently the usage which their superiors think proper to give them.

 In England, the different poll-taxes never produced the sum which had been expected from them, or which it was supposed they might have produced, had they been exactly levied.

In France, the capitation always produces the sum expected from it.

The mild government of England, when it assessed the different ranks of people to the poll-tax, contented itself with what that assessment happened to produce, and required no compensation for the loss which the state might sustain, either by those who could not pay, or by those who would not pay (for there were many such), and who, by the indulgent execution of the law, were not forced to pay.

The more severe government of France assesses upon each generality a certain sum, which the intendant must find as he can.

If any province complains of being assessed too high, it may, in the assessment of next year, obtain an abatement proportioned to the overcharge of the year before;

but it must pay in the mean time.

The intendant, in order to be sure of finding the sum assessed upon his generality, was empowered to assess it in a larger sum, that the failure or inability of some of the contributors might be compensated by the overcharge of the rest;

and till 1765, the fixation of this surplus assessment was left altogether to his discretion.

In that year, indeed, the council assumed this power to itself.

In the capitation of the provinces, it is observed by the perfectly well informed author of the Memoirs upon the Impositions in France, the proportion which falls upon the nobility, and upon those whose privileges exempt them from the taille, is the least considerable.

The largest falls upon those subject to the taille, who are assessed to the capitation at so much a-pound of what they pay to that other tax.

Capitation taxes, so far as they are levied upon the lower ranks of people, are direct taxes upon the wages of labour, and are attended with all the inconveniencies of such taxes.

 Capitation taxes are levied at little expense;

and, where they are rigorously exacted, afford a very sure revenue to the state.

It is upon this account that, in countries where the case, comfort, and security of the inferior ranks of people are little attended to, capitation taxes are very common.

It is in general, however, but a small part of the public revenue, which, in a great empire, has ever been drawn from such taxes;

and the greatest sum which they have ever afforded, might always have been found in some other way much more convenient to the people.

 Taxes upon Consumable Commodities.

 The impossibility of taxing the people, in proportion to their revenue, by any capitation, seems to have given occasion to the invention of taxes upon consumable commodities.

The state not knowing how to tax, directly and proportionably, the revenue of its subjects, endeavours to tax it indirectly by taxing their expense, which, it is supposed, will, in most cases, be nearly in proportion to their revenue.

Their expense is taxed, by taxing the consumable commodities upon which it is laid out.

 Consumable commodities are either necessaries or luxuries.

 By necessaries I understand, not only the commodities which are indispensibly necessary for the support of life, but whatever the custom of the country renders it indecent for creditable people, even of the lowest order, to be without.

A linen shirt, for example, is, strictly speaking, not a necessary of life.

The Greeks and Romans lived, I suppose, very comfortably, though they had no linen.

But in the present times, through the greater part of Europe, a creditable day-labourer would be ashamed to appear in public without a linen shirt, the want of which would be supposed to denote that disgraceful degree of poverty, which, it is presumed, nobody can well fall into without extreme bad conduct.

Custom, in the same manner, has rendered leather shoes a necessary of life in England.

The poorest creditable person, of either sex, would be ashamed to appear in public without them.

In Scotland, custom has rendered them a necessary of life to the lowest order of men;

but not to the same order of women, who may, without any discredit, walk about barefooted.

In France, they are necessaries neither to men nor to women;

the lowest rank of both sexes appearing there publicly, without any discredit, sometimes in wooden shoes, and sometimes barefooted.

Under necessaries, therefore, I comprehend, not only those things which nature, but those things which the established rules of decency have rendered necessary to the lowest rank of people.

All other things I call luxuries, without meaning, by this appellation, to throw the smallest degree of reproach upon the temperate use of them.

Beer and ale, for example, in Great Britain, and wine, even in the wine countries, I call luxuries.

A man of any rank may, without any reproach, abstain totally from tasting such liquors.

Nature does not render them necessary for the support of life;

and custom nowhere renders it indecent to live without them.

 As the wages of labour are everywhere regulated, partly by the demand for it, and partly by the average price of the necessary articles of subsistence;

whatever raises this average price must necessarily raise those wages;

so that the labourer may still be able to purchase that quantity of those necessary articles which the state of the demand for labour, whether increasing, stationary, or declining, requires that he should have. {See book i.chap. 8}

A tax upon those articles necessarily raises their price somewhat higher than the amount of the tax, because the dealer, who advances the tax, must generally get it back, with a profit.

Such a tax must, therefore, occasion a rise in the wages of labour, proportionable to this rise of price.

 It is thus that a tax upon the necessaries of life operates exactly in the same manner as a direct tax upon the wages of labour.

The labourer, though he may pay it out of his hand, cannot, for any considerable time at least, be properly said even to advance it.

It must always, in the long-run, be advanced to him by his immediate employer, in the advanced state of wages.

His employer, if he is a manufacturer, will charge upon the price of his goods the rise of wages, together with a profit, so that the final payment of the tax, together with this overcharge, will fall upon the consumer.

If his employer is a farmer, the final payment, together with a like overcharge, will fall upon the rent of the landlord.

 It is otherwise with taxes upon what I call luxuries, even upon those of the poor.

The rise in the price of the taxed commodities, will not necessarily occasion any rise in the wages of labour.

A tax upon tobacco, for example, though a luxury of the poor, as well as of the rich, will not raise wages.

Though it is taxed in England at three times, and in France at fifteen times its original price, those high duties seem to have no effect upon the wages of labour.

The same thing maybe said of the taxes upon tea and sugar, which, in England and Holland, have become luxuries of the lowest ranks of people;

and of those upon chocolate, which, in Spain, is said to have become so.

 The different taxes which, in Great Britain, have, in the course of the present century, been imposed upon spiritous liquors, are not supposed to have had any effect upon the wages of labour.

The rise in the price of porter, occasioned by an additional tax of three shillings upon the barrel of strong beer, has not raised the wages of common labour in London.

These were about eighteen pence or twenty pence a-day before the tax, and they are not more now.

 The high price of such commodities does not necessarily diminish the ability of the inferior ranks of people to bring up families.

Upon the sober and industrious poor, taxes upon such commodities act as sumptuary laws, and dispose them either to moderate, or to refrain altogether from the use of superfluities which they can no longer easily afford.

Their ability to bring up families, in consequence of this forced frugality, instead of being diminished, is frequently, perhaps, increased by the tax.

It is the sober and industrious poor who generally bring up the most numerous families, and who principally supply the demand for useful labour.

All the poor, indeed, are not sober and industrious;

and the dissolute and disorderly might continue to indulge themselves in the use of such commodities, after this rise of price, in the same manner as before, without regarding the distress which this indulgence might bring upon their families.

Such disorderly persons, however, seldom rear up numerous families, their children generally perishing from neglect, mismanagement, and the scantiness or unwholesomeness of their food.

If by the strength of their constitution, they survive the hardships to which the bad conduct of their parents exposes them, yet the example of that bad conduct commonly corrupts their morals;

so that, instead of being useful to society by their industry, they become public nuisances by their vices and disorders.

Through the advanced price of the luxuries of the poor, therefore, might increase somewhat the distress of such disorderly families, and thereby diminish somewhat their ability to bring up children, it would not probably diminish much the useful population of the country.

 Any rise in the average price of necessaries, unless it be compensated by a proportionable rise in the wages of labour, must necessarily diminish, more or less, the ability of the poor to bring up numerous families, and, consequently, to supply the demand for useful labour;

whatever may be the state of that demand, whether increasing, stationary, or declining;

or such as requires an increasing, stationary, or declining population.

 Taxes upon luxuries have no tendency to raise the price of any other commodities, except that of the commodities taxed.

Taxes upon necessaries, by raising the wages of labour, necessarily tend to raise the price of all manufactures, and consequently to diminish the extent of their sale and consumption.

Taxes upon luxuries are finally paid by the consumers of the commodities taxed, without any retribution.

They fall indifferently upon every species of revenue, the wages of labour, the profits of stock, and the rent of land.

Taxes upon necessaries, so far as they affect the labouring poor, are finally paid, partly by landlords, in the diminished rent of their lands, and partly by rich consumers, whether landlords or others, in the advanced price of manufactured goods;

and always with a considerable overcharge.

The advanced price of such manufactures as are real necessaries of life, and are destined for the consumption of the poor, of coarse woollens, for example, must be compensated to the poor by a farther advancement of their wages.

The middling and superior ranks of people, if they understood their own interest, ought always to oppose all taxes upon the necessaries of life, as well as all taxes upon the wages of labour.

The final payment of both the one and the other falls altogether upon themselves, and always with a considerable overcharge.

They fall heaviest upon the landlords, who always pay in a double capacity;

in that of landlords, by the reduction, of their rent;

and in that of rich consumers, by the increase of their expense.

The observation of Sir Matthew Decker, that certain taxes are, in the price of certain goods, sometimes repeated and accumulated four or five times, is perfectly just with regard to taxes upon the necessaries of life.

In the price of leather, for example, you must pay not only for the tax upon the leather of your own shoes, but for a part of that upon those of the shoemaker and the tanner.

You must pay, too, for the tax upon the salt, upon the soap, and upon the candles which those workmen consume while employed in your service;

and for the tax upon the leather, which the saltmaker, the soap-maker, and the candle-maker consume, while employed in their service.

 In Great Britain, the principal taxes upon the necessaries of life, are those upon the four commodities just now mentioned, salt, leather, soap, and candles.

 Salt is a very ancient and a very universal subject of taxation.

It was taxed among the Romans, and it is so at present in, I believe, every part of Europe.

The quantity annually consumed by any individual is so small, and may be purchased so gradually, that nobody, it seems to have been thought, could feel very sensibly even a pretty heavy tax upon it.

It is in England taxed at three shillings and fourpence a bushel;

about three times the original price of the commodity.

In some other countries, the tax is still higher.

Leather is a real necessary of life.

The use of linen renders soap such.

In countries where the winter nights are long, candles are a necessary instrument of trade.

Leather and soap are in Great Britain taxed at three halfpence a-pound; candles at a penny; taxes which, upon the original price of leather, may amount to about eight or ten per cent.; upon that of soap, to about twenty or five-and-twenty per cent.; and upon that of candles to about fourteen or fifteen per cent.; taxes which, though lighter than that upon salt, are still very heavy.

As all those four commodities are real necessaries of life, such heavy taxes upon them must increase somewhat the expense of the sober and industrious poor, and must consequently raise more or less the wages of their labour.

 In a country where the winters are so cold as in Great Britain, fuel is, during that season, in the strictest sense of the word, a necessary of life, not only for the purpose of dressing victuals, but for the comfortable subsistence of many different sorts of workmen who work within doors;

and coals are the cheapest of all fuel.

The price of fuel has so important an influence upon that of labour, that all over Great Britain, manufactures have confined themselves principally to the coal counties;

other parts of the country, on account of the high price of this necessary article, not being able to work so cheap.

In some manufactures, besides, coal is a necessary instrument of trade;

as in those of glass, iron, and all other metals.

If a bounty could in any case be reasonable, it might perhaps be so upon the transportation of coals from those parts of the country in which they abound, to those in which they are wanted.

But the legislature, instead of a bounty, has imposed a tax of three shillings and threepence a-ton upon coals carried coastways;

which, upon most sorts of coal, is more than sixty per cent.

of the original price at the coal pit.

Coals carried, either by land or by inland navigation, pay no duty.

Where they are naturally cheap, they are consumed duty free;

where they are naturally dear, they are loaded with a heavy duty.

 Such taxes, though they raise the price of subsistence, and consequently the wages of labour, yet they afford a considerable revenue to government, which it might not be easy to find in any other way.

There may, therefore, be good reasons for continuing them.

The bounty upon the exportation of corn, so far as it tends, in the actual state of tillage, to raise the price of that necessary article, produces all the like bad effects;

and instead of affording any revenue, frequently occasions a very great expense to government.

The high duties upon the importation of foreign corn, which, in years of moderate plenty, amount to a prohibition;

and the absolute prohibition of the importation, either of live cattle, or of salt provisions, which takes place in the ordinary state of the law, and which, on account of the scarcity, is at present suspended for a limited time with regard to Ireland and the British plantations, have all had the bad effects of taxes upon the necessaries of life, and produce no revenue to government.

Nothing seems necessary for the repeal of such regulations, but to convince the public of the futility of that system in consequence of which they have been established.

 Taxes upon the necessaries of life are much higher in many other countries than in Great Britain.

Duties upon flour and meal when ground at the mill, and upon bread when baked at the oven, take place in many countries.

In Holland the money-price of the bread consumed in towns is supposed to be doubled by means of such taxes.

In lieu of a part of them, the people who live in the country, pay every year so much a-head, according to the sort of bread they are supposed to consume.

Those who consume wheaten bread pay three guilders fifteen stivers;

about six shillings and ninepence halfpenny.

Those, and some other taxes of the same kind, by raising the price of labour, are said to have ruined the greater part of the manufactures of Holland {Memoires concernant les Droits, etc.

p. 210, 211.}.

Similar taxes, though not quite so heavy, take place in the Milanese, in the states of Genoa, in the duchy of Modena, in the duchies of Parma, Placentia, and Guastalla, and the Ecclesiastical state.

A French author {Le Reformateur} of some note, has proposed to reform the finances of his country, by substituting in the room of the greater part of other taxes, this most ruinous of all taxes.

There is nothing so absurd, says Cicero, which has not sometimes been asserted by some philosophers.

 Taxes upon butcher’s meat are still more common than those upon bread.

It may indeed be doubted, whether butcher’s meat is any where a necessary of life.

Grain and other vegetables, with the help of milk, cheese, and butter, or oil, where butter is not to be had, it is known from experience, can, without any butcher’s meat, afford the most plentiful, the most wholesome, the most nourishing, and the most invigorating diet.

Decency nowhere requires that any man should eat butcher’s meat, as it in most places requires that he should wear a linen shirt or a pair of leather shoes.

 Consumable commodities, whether necessaries or luxuries, may be taxed in two different ways.

The consumer may either pay an annual sum on account of his using or consuming goods of a certain kind;

or the goods may be taxed while they remain in the hands of the dealer, and before they are delivered to the consumer.

The consumable goods which last a considerable time before they are consumed altogether, are most properly taxed in the one way;

those of which the consumption is either immediate or more speedy, in the other.

The coach-tax and plate tax are examples of the former method of imposing;

the greater part of the other duties of excise and customs, of the latter.

 A coach may, with good management, last ten or twelve years.

It might be taxed, once for all, before it comes out of the hands of the coach-maker.

But it is certainly more convenient for the buyer to pay four pounds a-year for the privilege of keeping a coach, than to pay all at once forty or forty-eight pounds additional price to the coach-maker; or a sum equivalent to what the tax is likely to cost him during the time he uses the same coach.

A service of plate in the same manner, may last more than a century.

It is certainly-easier for the consumer to pay five shillings a-year for every hundred ounces of plate, near one per cent.

of the value, than to redeem this long annuity at five-and-twenty or thirty years purchase, which would enhance the price at least five-and-twenty or thirty per cent.

The different taxes which affect houses, are certainly more conveniently paid by moderate annual payments, than by a heavy tax of equal value upon the first building or sale of the house.

 It was the well-known proposal of Sir Matthew Decker, that all commodities, even those of which the consumption is either immediate or speedy, should be taxed in this manner;

the dealer advancing nothing, but the consumer paying a certain annual sum for the licence to consume certain goods.

The object of his scheme was to promote all the different branches of foreign trade, particularly the carrying trade, by taking away all duties upon importation and exportation, and thereby enabling the merchant to employ his whole capital and credit in the purchase of goods and the freight of ships, no part of either being diverted towards the advancing of taxes,

The project, however, of taxing, in this manner, goods of immediate or speedy consumption, seems liable to the four following very important objections.

First, the tax would be more unequal, or not so well proportioned to the expense and consumption of the different contributors, as in the way in which it is commonly imposed.

The taxes upon ale, wine, and spiritous liquors, which are advanced by the dealers, are finally paid by the different consumers, exactly in proportion to their respective consumption.

But if the tax were to be paid by purchasing a licence to drink those liquors, the sober would, in proportion to his consumption, be taxed much more heavily than the drunken consumer.

A family which exercised great hospitality, would be taxed much more lightly than one who entertained fewer guests.

Secondly, this mode of taxation, by paying for an annual, half-yearly, or quarterly licence to consume certain goods, would diminish very much one of the principal conveniences of taxes upon goods of speedy consumption;

the piece-meal payment.

In the price of threepence halfpenny, which is at present paid for a pot of porter, the different taxes upon malt, hops, and beer, together with the extraordinary profit which the brewer charges for having advanced than, may perhaps amount to about three halfpence.

If a workman can conveniently spare those three halfpence, he buys a pot of porter.

If he cannot, he contents himself with a pint;

and, as a penny saved is a penny got, he thus gains a farthing by his temperance.

He pays the tax piece-meal, as he can afford to pay it, and when he can afford to pay it, and every act of payment is perfectly voluntary, and what he can avoid if he chuses to do so.

Thirdly, such taxes would operate less as sumptuary laws.

When the licence was once purchased, whether the purchaser drunk much or drunk little, his tax would be the same.

Fourthly, if a workman were to pay all at once, by yearly, half-yearly, or quarterly payments, a tax equal to what he at present pays, with little or no inconveniency, upon all the different pots and pints of porter which he drinks in any such period of time, the sum might frequently distress him very much.

This mode of taxation, therefore, it seems evident, could never, without the most grievous oppression, produce a revenue nearly equal to what is derived from the present mode without any oppression.

In several countries, however, commodities of an immediate or very speedy consumption are taxed in this manner.

In Holland, people pay so much a-head for a licence to drink tea.

I have already mentioned a tax upon bread, which, so far as it is consumed in farm houses and country villages, is there levied in the same manner.

 The duties of excise are imposed chiefly upon goods of home produce, destined for home consumption.

They are imposed only upon a few sorts of goods of the most general use.

There can never be any doubt, either concerning the goods which are subject to those duties, or concerning the particular duty which each species of goods is subject to.

They fall almost altogether upon what I call luxuries, excepting always the four duties above mentioned, upon salt, soap, leather, candles, and perhaps that upon green glass.

 The duties of customs are much more ancient than those of excise.

They seem to have been called customs, as denoting customary payments, which had been in use for time immemorial.

They appear to have been originally considered as taxes upon the profits of merchants.

During the barbarous times of feudal anarchy, merchants, like all the other inhabitants of burghs, were considered as little better than emancipated bondmen, whose persons were despised, and whose gains were envied.

The great nobility, who had consented that the king should tallage the profits of their own tenants, were not unwilling that he should tallage likewise those of an order of men whom it was much less their interest to protect.

In those ignorant times, it was not understood, that the profits of merchants are a subject not taxable directly;

or that the final payment of all such taxes must fall, with a considerable overcharge, upon the consumers.

 The gains of alien merchants were looked upon more unfavourably than those of English merchants.

It was natural, therefore, that those of the former should be taxed more heavily than those of the latter.

This distinction between the duties upon aliens and those upon English merchants, which was begun from ignorance, has been continued front the spirit of monopoly, or in order to give our own merchants an advantage, both in the home and in the foreign market.

 With this distinction, the ancient duties of customs were imposed equally upon all sorts of goods, necessaries as well its luxuries, goods exported as well as goods imported.

Why should the dealers in one sort of goods, it seems to have been thought, be more favoured than those in another?

or why should the merchant exporter be more favoured than the merchant importer?

 The ancient customs were divided into three branches.

The first, and, perhaps, the most ancient of all those duties, was that upon wool and leather.

It seems to have been chiefly or altogether an exportation duty.

When the woollen manufacture came to be established in England, lest the king should lose any part of his customs upon wool by the exportation of woollen cloths, a like duty was imposed upon them.

The other two branches were, first, a duty upon wine, which being imposed at so much a-ton, was called a tonnage;

and, secondly, a duty upon all other goods, which being imposed at so much a-pound of their supposed value, was called a poundage.

In the forty-seventh year of Edward III., a duty of sixpence in the pound was imposed upon all goods exported and imported, except wools, wool-felts, leather, and wines which were subject to particular duties.

In the fourteenth of Richard II., this duty was raised to one shilling in the pound;

but, three years afterwards, it was again reduced to sixpence.

It was raised to eightpence in the second year of Henry IV.; and, in the fourth of the same prince, to one shilling.

From this time to the ninth year of William III., this duty continued at one shilling in the pound.

The duties of tonnage and poundage were generally granted to the king by one and the same act of parliament, and were called the subsidy of tonnage and poundage.

The subsidy of poundage having continued for so long a time at one shilling in the pound, or at five per cent., a subsidy came, in the language of the customs, to denote a general duty of this kind of five per cent.

This subsidy, which is now called the old subsidy, still continues to be levied, according to the book of rates established by the twelfth of Charles II.

The method of ascertaining, by a book of rates, the value of goods subject to this duty, is said to be older than the time of James I.

The new subsidy, imposed by the ninth and tenth of William III., was an additional five per cent.

upon the greater part of goods.

The one-third and the two-third subsidy made up between them another five per cent.

of which they were proportionable parts.

The subsidy of 1747 made a fourth five per cent.

upon the greater part of goods;

and that of 1759, a fifth upon some particular sorts of goods.

Besides those five subsidies, a great variety of other duties have occasionally been imposed upon particular sorts of goods, in order sometimes to relieve the exigencies of the state, and sometimes to regulate the trade of the country, according to the principles of the mercantile system.

 That system has come gradually more and more into fashion.

The old subsidy was imposed indifferently upon exportation, as well as importation.

The four subsequent subsidies, as well as the other duties which have since been occasionally imposed upon particular sorts of goods, have, with a few exceptions, been laid altogether upon importation.

The greater part of the ancient duties which had been imposed upon the exportation of the goods of home produce and manufacture, have either been lightened or taken away altogether.

In most cases, they have been taken away.

Bounties have even been given upon the exportation of some of them.

Drawbacks, too, sometimes of the whole, and, in most cases, of a part of the duties which are paid upon the importation of foreign goods, have been granted upon their exportation.

Only half the duties imposed by the old subsidy upon importation, are drawn back upon exportation;

but the whole of those imposed by the latter subsidies and other imposts are, upon the greater parts of the goods, drawn back in the same manner.

This growing favour of exportation, and discouragement of importation, have suffered only a few exceptions, which chiefly concern the materials of some manufactures.

These our merchants and manufacturers are willing should come as cheap as possible to themselves, and as dear as possible to their rivals and competitors in other countries.

Foreign materials are, upon this account, sometimes allowed to be imported duty-free; spanish wool, for example, flax, and raw linen yarn.

The exportation of the materials of home produce, and of those which are the particular produce of our colonies, has sometimes been prohibited, and sometimes subjected to higher duties.

The exportation of English wool has been prohibited.

That of beaver skins, of beaver wool, and of gum-senega, has been subjected to higher duties;

Great Britain, by the conquests of Canada and Senegal, having got almost the monopoly of those commodities.

 That the mercantile system has not been very favourable to the revenue of the great body of the people, to the annual produce of the land and labour of the country, I have endeavoured to show in the fourth book of this Inquiry.

It seems not to have been more favourable to the revenue of the sovereign;

so far, at least, as that revenue depends upon the duties of customs.

 In consequence of that system, the importation of several sorts of goods has been prohibited altogether.

This prohibition has, in some cases, entirely prevented, and in others has very much diminished, the importation of those commodities, by reducing the importers to the necessity of smuggling.

It has entirely prevented the importation of foreign wollens;

and it has very much diminished that of foreign silks and velvets,

In both cases, it has entirely annihilated the revenue of customs which might have been levied upon such importation.

 The high duties which have been imposed upon the importation of many different sorts of foreign goods in order to discourage their consumption in Great Britain, have, in many cases, served only to encourage smuggling, and, in all cases, have reduced the revenues of the customs below what more moderate duties would have afforded.

The saying of Dr. Swift, that in the arithmetic of the customs, two and two, instead of making four, make sometimes only one, holds perfectly true with regard to such heavy duties, which never could have been imposed, had not the mercantile system taught us, in many cases, to employ taxation as an instrument, not of revenue, but of monopoly.

 The bounties which are sometimes given upon the exportation of home produce and manufactures, and the drawbacks which are paid upon the re-exportation of the greater part of foreign goods, have given occasion to many frauds, and to a species of smuggling, more destructive of the public revenue than any other.

In order to obtain the bounty or drawback, the goods, it is well known, are sometimes shipped, and sent to sea, but soon afterwards clandestinely re-landed in some other part of the country.

The defalcation of the revenue of customs occasioned by bounties and drawbacks, of which a great part are obtained fraudulently, is very great.

The gross produce of the customs, in the year which ended on the 5th of January 1755, amounted to £5,068,000.

The bounties which were paid out of this revenue, though in that year there was no bounty upon corn, amounted to £167,806.

The drawbacks which were paid upon debentures and certificates, to £2,156,800.

Bounties and drawbacks together amounted to £2,324,600.

In consequence of these deductions, the revenue of the customs amounted only to £2,743,400;

from which deducting £287,900 for the expense of management, in salaries and other incidents, the neat revenue of the customs for that year comes out to be £2,455,500.

The expense of management, amounts, in this manner, to between five and six per cent.

upon the gross revenue of the customs;

and to something more than ten per cent.

upon what remains of that revenue, after deducting what is paid away in bounties and drawbacks.

 Heavy duties being imposed upon almost all goods imported, our merchant importers smuggle as much, and make entry of as little as they can.

Our merchant exporters, on the contrary, make entry of more than they export;

sometimes out of vanity, and to pass for great dealers in goods which pay no duty gain a bounty back.

Our exports, in consequence of these different frauds, appear upon the custom-house books greatly to overbalance our imports, to the unspeakable comfort of those politicians, who measure the national prosperity by what they call the balance of trade.

 All goods imported, unless particularly exempted, and such exemptions are not very numerous, are liable to some duties of customs.

If any goods are imported, not mentioned in the book of rates, they are taxed at 4s:93⁄4d. for every twenty shillings value, according to the oath of the importer, that is, nearly at five subsidies, or five poundage duties.

The book of rates is extremely comprehensive, and enumerates a great variety of articles, many of them little used, and, therefore, not well known.

It is, upon this account, frequently uncertain under what article a particular sort of goods ought to be classed, and, consequently what duty they ought to pay.

Mistakes with regard to this sometimes ruin the custom-house officer, and frequently occasion much trouble, expense, and vexation to the importer.

In point of perspicuity, precision, and distinctness, therefore, the duties of customs are much inferior to those of excise.

 In order that the greater part of the members of any society should contribute to the public revenue, in proportion to their respective expense, it does not seem necessary that every single article of that expense should be taxed.

The revenue which is levied by the duties of excise is supposed to fall as equally upon the contributors as that which is levied by the duties of customs;

and the duties of excise are imposed upon a few articles only of the most general used and consumption.

It has been the opinion of many people, that, by proper management, the duties of customs might likewise, without any loss to the public revenue, and with great advantage to foreign trade, be confined to a few articles only.

 The foreign articles, of the most general use and consumption in Great Britain, seem at present to consist chiefly in foreign wines and brandies;

in some of the productions of America and the West Indies, sugar, rum, tobacco, cocoa-nuts, etc.

and in some of those of the East Indies, tea, coffee, china-ware, spiceries of all kinds, several sorts of piece-goods, etc.

These different articles afford, the greater part of the perhaps, at present, revenue which is drawn from the duties of customs.

The taxes which at present subsist upon foreign manufactures, if you except those upon the few contained in the foregoing enumeration, have, the greater part of them, been imposed for the purpose, not of revenue, but of monopoly, or to give our own merchants an advantage in the home market.

By removing all prohibitions, and by subjecting all foreign manufactures to such moderate taxes, as it was found from experience, afforded upon each article the greatest revenue to the public, our own workmen might still have a considerable advantage in the home market;

and many articles, some of which at present afford no revenue to government, and others a very inconsiderable one, might afford a very great one.

 High taxes, sometimes by diminishing the consumption of the taxed commodities, and sometimes by encouraging smuggling frequently afford a smaller revenue to government than what might be drawn from more moderate taxes.

 When the diminution of revenue is the effect of the diminution of consumption, there can be but one remedy, and that is the lowering of the tax.

When the diminution of revenue is the effect of the encouragement given to smuggling, it may, perhaps, be remedied in two ways;

either by diminishing the temptation to smuggle, or by increasing the difficulty of smuggling.

The temptation to smuggle can be diminished only by the lowering of the tax;

and the difficulty of smuggling can be increased only by establishing that system of administration which is most proper for preventing it.

 The excise laws, it appears, I believe, from experience, obstruct and embarrass the operations of the smuggler much more effectually than those of the customs.

By introducing into the customs a system of administration as similar to that of the excise as the nature of the different duties will admit, the difficulty of smuggling might be very much increased.

This alteration, it has been supposed by many people, might very easily be brought about.

 The importer of commodities liable to any duties of customs, it has been said, might, at his option, be allowed either to carry them to his own private warehouse;

or to lodge them in a warehouse, provided either at his own expense or at that of the public, but under the key of the custom-house officer, and never to be opened but in his presence.

If the merchant carried them to his own private warehouse, the duties to be immediately paid, and never afterwards to be drawn back;

and that warehouse to be at all times subject to the visit and examination of the custom-house officer, in order to ascertain how far the quantity contained in it corresponded with that for which the duty had been paid.

If he carried them to the public warehouse, no duty to be paid till they were taken out for home consumption.

If taken out for exportation, to be duty-free; proper security being always given that they should be so exported.

The dealers in those particular commodities, either by wholesale or retail, to be at all times subject to the visit and examination of the custom-house officer;

and to be obliged to justify, by proper certificates, the payment of the duty upon the whole quantity contained in their shops or warehouses.

What are called the excise duties upon rum imported, are at present levied in this manner;

and the same system of administration might, perhaps, be extended to all duties upon goods imported;

provided always that those duties were, like the duties of excise, confined to a few sorts of goods of the most general use and consumption.

If they were extended to almost all sorts of goods, as at present, public warehouses of sufficient extent could not easily be provided;

and goods of a very delicate nature, or of which the preservation required much care and attention, could not safely be trusted by the merchant in any warehouse but his own.

 If, by such a system of administration, smuggling to any considerable extent could be prevented, even under pretty high duties;

and if every duty was occasionally either heightened or lowered according as it was most likely, either the one way or the other, to afford the greatest revenue to the state;

taxation being always employed as an instrument of revenue, and never of monopoly;

it seems not improbable that a revenue, at least equal to the present neat revenue of the customs, might be drawn from duties upon the importation of only a few sorts of goods of the most general use and consumption;

and that the duties of customs might thus be brought to the same degree of simplicity, certainty, and precision, as those of excise.

What the revenue at present loses by drawbacks upon the re-exportation of foreign goods, which are afterwards re-landed and consumed at home, would, under this system, be saved altogether.

If to this saving, which would alone be very considerable, were added the abolition of all bounties upon the exportation of home produce;

in all cases in which those bounties were not in reality drawbacks of some duties of excise which had before been advanced;

it cannot well be doubted, but that the neat revenue of customs might, after an alteration of this kind, be fully equal to what it had ever been before.

 If, by such a change of system, the public revenue suffered no loss, the trade and manufactures of the country would certainly gain a very considerable advantage.

The trade in the commodities not taxed, by far the greatest number would be perfectly free, and might be carried on to and from all parts of the world with every possible advantage.

Among those commodities would be comprehended all the necessaries of life, and all the materials of manufacture.

So far as the free importation of the necessaries of life reduced their average money price in the home market, it would reduce the money price of labour, but without reducing in any respect its real recompence.

The value of money is in proportion to the quantity of the necessaries of life which it will purchase.

That of the necessaries of life is altogether independent of the quantity of money which can be had for them.

The reduction in the money price of labour would necessarily be attended with a proportionable one in that of all home manufactures, which would thereby gain some advantage in all foreign markets.

The price of some manufactures would be reduced, in a still greater proportion, by the free importation of the raw materials.

If raw silk could be imported from China and Indostan, duty-free, the silk manufacturers in England could greatly undersell those of both France and Italy.

There would be no occasion to prohibit the importation of foreign silks and velvets.

The cheapness of their goods would secure to our own workmen, not only the possession of a home, but a very great command of the foreign market.

Even the trade in the commodities taxed, would be carried on with much more advantage than at present.

If those commodities were delivered out of the public warehouse for foreign exportation, being in this case exempted from all taxes, the trade in them would be perfectly free.

The carrying trade, in all sorts of goods, would, under this system, enjoy every possible advantage.

If these commodities were delivered out for home consumption, the importer not being obliged to advance the tax till he had an opportunity of selling his goods, either to some dealer, or to some consumer, he could always afford to sell them cheaper than if he had been obliged to advance it at the moment of importation.

Under the same taxes, the foreign trade of consumption, even in the taxed commodities, might in this manner be carried on with much more advantage than it is at present.

 It was the object of the famous excise scheme of Sir Robert Walpole, to establish, with regard to wine and tobacco, a system not very unlike that which is here proposed.

But though the bill which was then brought into Parliament, comprehended those two commodities only, it was generally supposed to be meant as an introduction to a more extensive scheme of the same kind.

Faction, combined with the interest of smuggling merchants, raised so violent, though so unjust a clamour, against that bill, that the minister thought proper to drop it;

and, from a dread of exciting a clamour of the same kind, none of his successors have dared to resume the project.

 The duties upon foreign luxuries, imported for home consumption, though they sometimes fall upon the poor, fall principally upon people of middling or more than middling fortune.

Such are, for example, the duties upon foreign wines, upon coffee, chocolate, tea, sugar, etc.

 The duties upon the cheaper luxuries of home produce, destined for home consumption, fall pretty equally upon people of all ranks, in proportion to their respective expense.

The poor pay the duties upon malt, hops, beer, and ale, upon their own consumption;

the rich, upon both their own consumption and that of their servants.

 The whole consumption of the inferior ranks of people, or of those below the middling rank, it must be observed, is, in every country, much greater, not only in quantity, but in value, than that of the middling, and of those above the middling rank.

The whole expense of the inferior is much greater titan that of the superior ranks.

In the first place, almost the whole capital of every country is annually distributed among the inferior ranks of people, as the wages of productive labour.

Secondly, a great part of the revenue, arising from both the rent of land and the profits of stock, is annually distributed among the same rank, in the wages and maintenance of menial servants, and other unproductive labourers.

Thirdly, some part of the profits of stock belongs to the same rank, as a revenue arising from the employment of their small capitals.

The amount of the profits annually made by small shopkeepers, tradesmen, and retailers of all kinds, is everywhere very considerable, and makes a very considerable portion of the annual produce.

Fourthly and lastly, some part even of the rent of land belongs to the same rank;

a considerable part to those who are somewhat below the middling rank, and a small part even to the lowest rank;

common labourers sometimes possessing in property an acre or two of land.

Though the expense of those inferior ranks of people, therefore, taking them individually, is very small, yet the whole mass of it, taking them collectively, amounts always to by much the largest portion of the whole expense of the society;

what remains of the annual produce of the land and labour of the country, for the consumption of the superior ranks, being always much less, not only in quantity, but in value.

The taxes upon expense, therefore, which fall chiefly upon that of the superior ranks of people, upon the smaller portion of the annual produce, are likely to be much less productive than either those which fall indifferently upon the expense of all ranks, or even those which fall chiefly upon that of the inferior ranks, than either those which fall indifferently upon the whole annual produce, or those which fall chiefly upon the larger portion of it.

The excise upon the materials and manufacture of home-made fermented and spirituous liquors, is, accordingly, of all the different taxes upon expense, by far the most productive;

and this branch of the excise falls very much, perhaps principally, upon the expense of the common people.

In the year which ended on the 5th of July 1775, the gross produce of this branch of the excise amounted to £3,341,837:9:9.

 It must always be remembered, however, that it is the luxuries, and not the necessary expense of the inferior ranks of people, that ought ever to be taxed.

The final payment of any tax upon their necessary expense, would fall altogether upon the superior ranks of people;

upon the smaller portion of the annual produce, and not upon the greater.

Such a tax must, in all cases, either raise the wages of labour, or lessen the demand for it.

It could not raise the wages of labour, without throwing the final payment of the tax upon the superior ranks of people.

It could not lessen the demand for labour, without lessening the annual produce of the land and labour of the country, the fund upon which all taxes must be finally paid.

Whatever might be the state to which a tax of this kind reduced the demand for labour, it must always raise wages higher than they otherwise would be in that state;

and the final payment of this enhancement of wages must, in all cases, fall upon the superior ranks of people.

 Fermented liquors brewed, and spiritous liquors distilled, not for sale, but for private use, are not in Great Britain liable to any duties of excise.

This exemption, of which the object is to save private families from the odious visit and examination of the tax-gatherer, occasions the burden of those duties to fall frequently much lighter upon the rich than upon the poor.

It is not, indeed, very common to distil for private use, though it is done sometimes.

But in the country, many middling and almost all rich and great families, brew their own beer.

Their strong beer, therefore, costs them eight shillings a-barrel less than it costs the common brewer, who must have his profit upon the tax, as well as upon all the other expense which he advances.

Such families, therefore, must drink their beer at least nine or ten shillings a-barrel cheaper than any liquor of the same quality can be drank by the common people, to whom it is everywhere more convenient to buy their beer, by little and little, from the brewery or the ale-house.

Malt, in the same manner, that is made for the use of a private family, is not liable to the visit or examination of the tax-gatherer but, in this case the family must compound at seven shillings and sixpence a-head for the tax.

Seven shillings and sixpence are equal to the excise upon ten bushels of malt;

a quantity fully equal to what all the different members of any sober family, men, women, and children, are, at an average, likely to consume.

But in rich and great families, where country hospitality is much practised, the malt liquors consumed by the members of the family make but a small part of the consumption of the house.

Either on account of this composition, however, or for other reasons, it is not near so common to malt as to brew for private use.

It is difficult to imagine any equitable reason, why those who either brew or distil for private use should not be subject to a composition of the same kind.

 A greater revenue than what is at present drawn from all the heavy taxes upon malt, beer, and ale, might be raised, it has frequently been said, by a much lighter tax upon malt;

the opportunities of defrauding the revenue being much greater in a brewery than in a malt-house;

and those who brew for private use being exempted from all duties or composition for duties, which is not the case with those who malt for private use.

 In the porter brewery of London, a quarter of malt is commonly brewed into more than two barrels and a-half, sometimes into three barrels of porter.

The different taxes upon malt amount to six shillings a-quarter; those upon strong ale and beer to eight shillings a-barrel.

In the porter brewery, therefore, the different taxes upon malt, beer, and ale, amount to between twenty-six and thirty shillings upon the produce of a quarter of malt.

In the country brewery for common country sale, a quarter of malt is seldom brewed into less than two barrels of strong, and one barrel of small beer;

frequently into two barrels and a-half of strong beer.

The different taxes upon small beer amount to one shilling and fourpence a-barrel.

In the country brewery, therefore, the different taxes upon malt, beer, and ale, seldom amount to less than twenty-three shillings and fourpence, frequently to twenty-six shillings, upon the produce of a quarter of malt.

Taking the whole kingdom at an average, therefore, the whole amount of the duties upon malt, beer, and ale, cannot be estimated at less than twenty-four or twenty-five shillings upon the produce of a quarter of malt.

But by taking off all the different duties upon beer and ale, and by trebling the malt tax, or by raising it from six to eighteen shillings upon the quarter of malt, a greater revenue, it is said, might be raised by this single tax, than what is at present drawn from all those heavier taxes.

 - In 1772, the old malt tax produced......... £722,023: 11: 11

- The additional... £356,776: 7: 93⁄4

- In 1775, the old tax produced............... £561,627: 3: 71⁄2

- The additional... £278,650: 15: 33⁄4

- In 1774, the old tax produced ............ £624,614: 17: 53⁄4

- The additional....£310,745: 2: 81⁄2

- In 1775, the old tax produced ............£657,357: 0: 81⁄4

- The additional....£323,785: 12: 61⁄4

- £5,855,580: 12: 03⁄4

- Average of these four years .............. £958,895: 3: 0

-

- In 1772, the country excise produced.......£1,243,120: 5: 3

- The London brewery 408,260: 7: 23⁄4

- In 1773, the country excise................£1,245,808: 3: 3

- The London brewery 405,406: 17: 101⁄2

- In 1774, the country excise................£1,246,373: 14: 51⁄2

- The London brewery 320,601: 18: 01⁄4

- In 1775, the country excise................£1,214,583: 6: 11⁄4

- The London brewery 463,670: 7: 01⁄4

- 4)£6,547,832: 19: 21⁄4

- Average of these four years ..............£1,636,958: 4: 91⁄2

- To which adding the average malt tax........ 958,895: 3: 01⁄4

-

- The whole amount of those different

- taxes comes out to be........£2,595,835: 7: 10

-

- But, by trebling the malt tax,

- or by raising it from six to

- eighteen shillings upon the quarter

- of malt, that single tax would produce.....£2,876,685: 9: 0

- A sum which exceeds the

- foregoing by.... 280,832: 1: 3

 Under the old malt tax, indeed, is comprehended a tax of four shillings upon the hogshead of cyder, and another of ten shillings upon the barrel of mum.

In 1774, the tax upon cyder produced only £3,083:6:8.

It probably fell somewhat short of its usual amount;

all the different taxes upon cyder, having, that year, produced less than ordinary.

The tax upon mum, though much heavier, is still less productive, on account of the smaller consumption of that liquor.

But to balance whatever may be the ordinary amount of those two taxes, there is comprehended under what is called the country excise, first, the old excise of six shillings and eightpence upon the hogshead of cyder;

secondly, a like tax of six shillings and eightpence upon the hogshead of verjuice;

thirdly, another of eight shillings and ninepence upon the hogshead of vinegar;

and, lastly, a fourth tax of elevenpence upon the gallon of mead or metheglin.

The produce of those different taxes will probably much more than counterbalance that of the duties imposed, by what is called the annual malt tax, upon cyder and mum.

 Malt is consumed, not only in the brewery of beer and ale, but in the manufacture of low wines and spirits.

If the malt tax were to be raised to eighteen shillings upon the quarter, it might be necessary to make some abatement in the different excises which are imposed upon those particular sorts of low wines and spirits, of which malt makes any part of the materials.

In what are called malt spirits, it makes commonly but a third part of the materials;

the other two-thirds being either raw barley, or one-third barley and one-third wheat.

In the distillery of malt spirits, both the opportunity and the temptation to smuggle are much greater than either in a brewery or in a malt-house; the opportunity, on account of the smaller bulk and greater value of the commodity, and the temptation, on account of the superior height of the duties, which amounted to 3s. 10 2/3d. upon the gallon of spirits.

{Though the duties directly imposed upon proof spirits amount only to 2s. 6d per gallon, these, added to the duties upon the low wines, from which they are distilled, amount to 3s 10 2/3d.

Both low wines and proof spirits are, to prevent frauds, now rated according to what they gauge in the wash.}

 By increasing the duties upon malt, and reducing those upon the distillery, both the opportunities and the temptation to smuggle would be diminished, which might occasion a still further augmentation of revenue.

 It has for some time past been the policy of Great Britain to discourage the consumption of spiritous liquors, on account of their supposed tendency to ruin the health and to corrupt the morals of the common people.

According to this policy, the abatement of the taxes upon the distillery ought not to be so great as to reduce, in any respect, the price of those liquors.

Spiritous liquors might remain as dear as ever;

while, at the same time, the wholesome and invigorating liquors of beer and ale might be considerably reduced in their price.

The people might thus be in part relieved from one of the burdens of which they at present complain the most;

while, at the same time, the revenue might be considerably augmented.

 The objections of Dr. Davenant to this alteration in the present system of excise duties, seem to be without foundation.

Those objections are, that the tax, instead of dividing itself, as at present, pretty equally upon the profit of the maltster, upon that of the brewer and upon that of the retailer, would so far as it affected profit, fall altogether upon that of the maltster;

that the maltster could not so easily get back the amount of the tax in the advanced price of his malt, as the brewer and retailer in the advanced price of their liquor;

and that so heavy a tax upon malt might reduce the rent and profit of barley land.

 No tax can ever reduce, for any considerable time, the rate of profit in any particular trade, which must always keep its level with other trades in the neighbourhood.

The present duties upon malt, beer, and ale, do not affect the profits of the dealers in those commodities, who all get back the tax with an additional profit, in the enhanced price of their goods.

A tax, indeed, may render the goods upon which it is imposed so dear, as to diminish the consumption of them.

But the consumption of malt is in malt liquors;

and a tax of eighteen shillings upon the quarter of malt could not well render those liquors dearer than the different taxes, amounting to twenty-four or twenty-five shillings, do at present.

Those liquors, on the contrary, would probably become cheaper, and the consumption of them would be more likely to increase than to diminish.

 It is not very easy to understand why it should be more difficult for the maltster to get back eighteen shillings in the advanced price of his malt, than it is at present for the brewer to get back twenty-four or twenty-five, sometimes thirty shillings, in that of his liquor.

The maltster, indeed, instead of a tax of six shillings, would be obliged to advance one of eighteen shilling upon every quarter of malt.

But the brewer is at present obliged to advance a tax of twenty-four or twenty-five, sometimes thirty shillings, upon every quarter of malt which he brews.

It could not be more inconvenient for the maltster to advance a lighter tax, than it is at present for the brewer to advance a heavier one.

The maltster does not always keep in his granaries a stock of malt, which it will require a longer time to dispose of than the stock of beer and ale which the brewer frequently keeps in his cellars.

The former, therefore, may frequently get the returns of his money as soon as the latter.

But whatever inconveniency might arise to the maltster from being obliged to advance a heavier tax, it could easily be remedied, by granting him a few months longer credit than is at present commonly given to the brewer.

 Nothing could reduce the rent and profit of barley land, which did not reduce the demand for barley.

But a change of system, which reduced the duties upon a quarter of malt brewed into beer and ale, from twentyfour and twenty-five shillings to eighteen shillings, would be more likely to increase than diminish that demand.

The rent and profit of barley land, besides, must always be nearly equal to those of other equally fertile and equally well cultivated land.

If they were less, some part of the barley land would soon be turned to some other purpose;

and if they were greater, more land would soon be turned to the raising of barley.

When the ordinary price of any particular produce of land is at what may be called a monopoly price, a tax upon it necessarily reduces the rent and profit of the land which grows it.

A tax upon the produce of those precious vineyards, of which the wine falls so much short of the effectual demand, that its price is always above the natural proportion to that of the produce of other equally fertile and equally well cultivated land, would necessarily reduce the rent and profit of those vineyards.