ment at Somerset House itself, which issued Form IV. It was their task to ascertain capital values of land according to certain definitions, which I have already summarised. It was not their duty to ascertain annual value. Yet when they issued a form of return which was to give them information on matters which may properly be required for the purpose of ascertaining those capital values, they put to owners occupying their own property this question:-'If the person making the return is also the occupier, state the annual value; i.e. the sum for which the property is worth to be let to a yearly tenant, the owner keeping it in repair.' The words 'to be let' are printed in bold black type. The illegality of this question does not concern us here, for the Court of Appeal has pronounced upon that; the moral lies in this, that the Department, being called upon to make estimates of capital value, think that in order to do so they must try to obtain from the owner an estimate of the annual value, and consider it worth while for that end to run a risk of having the whole proceeding declared to be unauthorised. Can there be stronger evidence that, in England, in any case where no rent exists it is necessary to invent one?

Of the values to be estimated in the National Valuation, the only one which is utilised in the Budget of 1909-10 for the purpose of taxation is the assessable or original site value, and that is used for two only of the new taxes-namely, the increment value duty and the undeveloped land duty. Owing to the ingenuity of the framers of that measure, it is to the interest of the owners to place that value as high as possible for the purposes of increment value duty, and as low as possible for the purposes of undeveloped land duty. It follows, as a corollary which scarcely needs stating, that it is to the interest of the Crown to have the value as low as possible for the one duty; as high as possible for the other. Now these two dilemmas might perhaps co-operate to produce an accurate result, if all the land were being valued at once. But, quite naturally and in order that the taxes may be collected when they fall due, land which is likely to give occasion. for the levy of either of these taxes is being valued first; the two taxes are not necessarily now leviable in respect of the same classes of land, and the increment value duty applies of course to many classes of land other than undeveloped land. For the increment value duty is to be collected in respect to any description of land on the occasion of sale, of the grant of a lease for more than fourteen years, of death, and on certain periodical occasions with regard to corporations and other bodies; while the undeveloped land duty is an annual tax levied (if I may put it shortly) on agricultural land which has more than an agricultural value, and on vacant town sites. Consequently, it will only be

in regard to a minority of the pieces of land to be valued in the National Valuation that all the causes named can co-operate to produce accuracy. Value must always be a question of individual estimate, especially when it has to be ascertained upon new and artificial principles. It is clear from ministerial speeches and from the Report of the Inland Revenue Commissioners that Ministers are commendably anxious for the National Valuation to be carried through with as little friction and as little litigation as possible. Now, the way to bring about this desirable end is for the Crown gracefully to give way to those who object or appeal; and to settle figures by way of compromise rather than to allow disputed cases to become public in the Press, or to be brought up in Parliament. In other words, the richer classes of landowners who can afford professional advice and assistance and who take the trouble to employ it very largely have their own way with the valuations, while the poorer or less active persons who are interested in land go to the wall. In this connexion it must not be forgotten that 'owners' of land as defined in the Act of 1910 include leaseholders with more than fifty years unexpired, and it can scarcely be necessary to point out once more that among the owners of English land there is a large proportion of people of small means, who are not dukes' in any sense. For all these reasons and for others which cannot be stated here without excessive technicality—the National Valuation when completed may or may not be a good guide for the assessment of increment value duty and undeveloped land duty; it will not be a record, eternal in the heavens, of the values of land—and it ought not to be made the basis of a general rating or a general taxation for which it was not originally intended to serve.

What reasons then are alleged for making this sudden and fundamental change in a system of local taxation which has grown up gradually during the last three hundred years, which has not been imported from abroad, and which may be presumed therefore to have some relation to the conditions of English land and to the character of the English people? According to the Lord Advocate, in a speech from which the United Committee think it worth while to circulate an extract, these reasons are to be found in the facts that land does not owe its existence to man, that it is limited in quantity, that it is necessary for our existence, for our production, and for the exchange of our products, that it cannot be carried away or concealed. Now these statements are undoubtedly true. But which of them (except perhaps the first) is not true of capital also? It is true that we cannot exist without land; but at this stage of our complicated civilisation, surely it is a useless platitude. We must have land to stand, to sit, to lie down upon; but every one of us must have capital to keep

him alive. Without capital how does the child live until he is strong enough to ply a spade? On the wages of his father, it may be said. But how does his father earn wages, unless there be capital invested in the business that keeps him employed? If he were not paid until the corn grown on the field that he has ploughed comes into the market, until the house of which he helped to lay the foundations is let, who would support his child in the meantime? But it is a waste of time to deal with these absurdities; they need only to be stated. In the twentieth century we do not live upon the berries that we can gather off wild bushes, nor yet upon the milk of our own goats. Not one of us could, in this intricate world of ours, remain alive beyond the next mealtime if he were not supported by capital-his own or another's. Of course capital is a necessity of production and of exchange; equally of course, capital, so much at any rate as is invested in buildings and machinery, cannot be carried away or concealed.

So far Mr. Ure's dogmas are true, but true of capital as well as of land. There are, however, two more of his 'reasons' of which the same cannot be said. 'Land does not owe its value to anything which its owner chooses to spend upon it. Land owes its value entirely to the presence and activity and existence of the community.' I hesitate to say that these statements are untrue, because I should be answered that the word 'land' was used in the sense of unimproved land.' But if the word is used in this sense, then they contain no practical truth; for no man in England can wholly separate the land from the improvements, and no man-other than an ardent partisan of Land Values taxation-uses the word 'land' as meaning anything else than the land as he sees it, covered with dwelling houses or factories if it be town land; drained, embanked, fenced, if it be agricultural land. Moreover these sentences assume that all the enhanced value of land which is due to improvements on other land is due to the expenditure of the community; and such is not the fact. If you value a whole estate at once, you may in rare cases find that any margin of value which it possesses above ‘prairie value ' is due to the community. But if, as you almost always must (and as the National Valuation does), you value the estate in many separate pieces, you will find that a great part of the enhanced value of each piece of land is due to the personal expenditure of the owner, or of adjoining owners. For instance, it is the owner who has paid for the sewering, paving and making up of the new streets; it is the owner and his neighbours who have paid for the walls and channels by which lands are reclaimed from sea and river and marsh; a railway is extended to serve a suburban district which would not otherwise have been developed for years to come, it is the owners of the railway who have paid for the

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extension. But land-owning' (I quote from Form IV.-What next?') is not an industry: it is a form of idleness, which is usually profitable, but is about as wealth-producing an occupation as snoring.'

'It is land-using that gives employment to labour, and adds to the sum total of wealth,' that publication goes on to say; but does not explain how land-using' can be done without capital, or why land-users should be penalised if they are also the owners of land. The pamphlets are eloquent in their denunciation of the penalties imposed upon industry by the present system of rating, and tell us constantly how (under the present system) anyone improving land, by the erection of a factory and so on, is immediately fined by being rated upon the improved annual value. The person who invests his capital in a business-such as shipping or stockbroking-which does not require the use of much land, is 'fined' by the income-tax; and the doctor, the barrister, even the Chancellor of the Exchequer-whose efforts (or the efforts of some of them) are, it may be hoped, equally beneficial to the community-are 'fined' in the same way. So is the man who saves money out of his earned income, and the dividends from whose investments are taxed at the higher rate as unearned income.' The sympathies of the United Committee are not extended to these hardworking and thrifty individuals; but only to those classes who are assumed to be lessees of land, and whose 'fines' they hope to transfer to the landlords. The facts that people who improve lands by starting new industries frequently buy land for the purpose before doing so, and that even in England the leasehold system is far from being universal, appear to have escaped their notice.

Among a list of 100 Reasons for Taxing Land Values' I find that thereby Canal and Railway Nationalisation will be made equitable, Cruelty to Children diminished, Rural Depopulation stopped, Milk Supply improved, Income Tax unnecessary, Street Noises diminished, Suicides lessened, House of Lords abolished if desired, Beautiful Landscape Scenery preserved, Women Workers benefited, Leasehold Enfranchisement unnecessary.' Of these results then, the land-taxers have made sure; and it seems scarcely fair to enquire drily about less romantic matters. But nowhere do I find any information, or any serious discussion, upon such questions as-Whether the parish, or the county, or the Kingdom is to be the area of the new taxation? What is to be done with regard to existing contracts? Is the landlord who has let his land on a ninety-nine years' lease to be taxed now, when forty years of the lease are unexpired, upon an unimproved value, which has been made by his exertions or those of his neighbours far greater than it was sixty years ago,

but which he has no chance of enjoying for another forty years? or is the tenant to pay? How is the new taxation to deal with the site value of land which increases because a new factory is placed upon it, and because therefore the presence and activity' of the community come in the course of years to surround it? When the present owners who are said to 'hold up' property have been forced by the new taxation to sell their lands for purposes of industry or residence (and that is one of the avowed objects of these proposals), is the new owner to pay the site value rate, or is the new lessee? Builders of dwelling houses, and even of industrial buildings, raise money on mortgage to enable them to build; how will existing and future mortgages be affected by all the taxation being put upon the value of the site? How are we to prevent the placing of an enormously increased burden upon genuine agricultural land, which appears almost inevitable if the taxation upon land used for railways and other industrial purposes is to be based upon unimproved value?

These are a few of the many and grave questions which must arise in the mind of anyone who has experience of the tenure, the use, or the value of English land, whether agricultural or industrial, urban or rural, if he sets himself seriously to consider the proposals to levy rates on the basis of the National Valuation and to levy a budget tax on all Land Values. Some of these problems are ignored by the advocates of the new proposals; some are only mentioned to be thrust aside. True, it is claimed that the real objects of that party or group are to redress existing inequalities of rating and taxation, to remove burdens which hamper industry, and to increase the housing accommodation of the poorer classes. But until they show that they are determined to face the problems that have been indicated, and to solve them if they are capable of solution, it is difficult to believe that their main object is anything else but gradually, and by stages which they hope will be imperceptible, to appropriate to the State the whole annual profits of the land; in other words, to deprive the present owners of all the advantages of ownership and to leave them (for all compensation) the mere name, coupled perhaps with some of the duties, of ownership.

'It is desirable,' says the Fourth Report, that rent should be made a public fund. . . . The whole of the increase [in rent] would gradually be taken for the public, and thus the whole benefit would go to the community.' The words belong to the jargon of a certain school of political economy. Translated into the vernacular, they can only mean that the time is at hand to take from the owner of land the whole of his income, and to give him nothing in return.

E. M. KONSTAM.