Indirect taxes are borne with greater resignation, just because they are unnoticed when paid. They are not so irritating as direct taxes. Merged in the weekly expenditure, they constitute no special burdens on any; and though the import duty may somewhat add to the price of the article even beyond the duty itself, the consumer scarcely perceives the centesimal proportion by which the cost is thereby enhanced.

Nor is it unimportant to have an eye to the popularity or unpopularity of certain taxes. The body politic, whatever be its constitution, is often convulsed and subject to internal ebullition. When labour is scarce and food is dear, when measures of reform are retarded or political faction is rampant, then the difficulties of collecting the ordinary revenues are tenfold aggravated, and then it is that direct taxation is more generally evaded and even proudly resisted. The state of political education among the people seems also to dictate the necessity of resorting to indirect taxation. How few comparatively know what is done with the money collected annually by taxes. What exaggerated notions would be formed of the cost attending the maintenance of regal authority; and although through the means of the public press much political knowledge is diffused in the cottage as well as in the palace, but vague notions are formed of the proceeds and disposal of the public revenues. It must be admitted that, however much we may be convinced of the necessity of supporting the State, and however strong the belief that strict integrity and the utmost economy are exercised in the administration of the public

funds, there is a natural aversion in contributing for such public purposes any given sum out of our individual resources. A fair combination of direct and indirect taxes is more elastic and manageable, and enables the Chancellor of the Exchequer to supply the wants of the State with greater ease and more extended co-operation.

Indirect taxes are said to be opposed to the principle that every tax ought to be so contrived as both to take out and to keep out of the pockets of the people as little as possible over and above what it brings into the public treasury. Doubtless the trader and dealer must charge interest and profit not only on the price of the article but on the duty he must pay beforehand. This addition was, however, much more grievous when Customs duties were required to be paid on the arrival of the goods, when there were no bonding warehouses, and when great difficulties were in the way of the immediate supply of the articles in distant places of the realm. Now this is all changed. Every facility is afforded by the Customs authorities for diminishing the loss produced by the investment of large sums in duties, by allowing the articles to be kept in bond till they are actually wanted for consumption; and so expeditiously are goods carried from place to place, and so instantaneous are the means of communication, that the trader in the farthest corner of the land need not provide himself with a greater quantity of duty-paid goods than he requires for his immediate

wants.

Nor can we say that any material difference exists in

the cost of collection between direct and indirect taxes. Owing to the improvements made in the revenue department, the cost of collecting the different branches of the revenue has been much reduced, and somewhat more equalized. The rate of collection of Customs duties is now about 3 per cent.; the Excise costs 4 per cent.; the stamps 2 per cent.; income and property tax, 2 per cent.; and the assessed taxes, 4 per cent. And whilst there are as many as 54,000 tax collectors, no fewer than 44,000 are employed in collecting the land and assessed taxes, and property and income tax ; 4000 in collecting the Excise, and 6000 in the Customs department.

The present taxation of the United Kingdom is raised in the following manner :-Of direct taxes we have the income and property tax, and the land and assessed taxes. Of indirect taxes we have the Customs and Excise, the Stamps and the Post-office; the proportions of the different sources being 16 per cent. direct taxes, 81 per cent. indirect taxes, and about 3 per cent. miscellaneous receipts. As compared with other coun

tries, we are perhaps obtaining far too large an amount from indirect taxation; but the revenues of foreign States generally comprise a much larger amount from property belonging to the crown, monopolies, &c., &c. In Prussia the proportion of direct tax is 46 per cent., in Austria 32, in Russia 29, in Holland 25, in Spain 25 per cent., in Portugal 23, and in France 17 per cent. ; and whilst we are obtaining as much as 81 per cent. in indirect taxes, in Russia the proportion is only 32 per cent., in Prussia 40 per cent., in Portugal 50, in Holland 51, in Austria 52, in Spain 62, and in France 63 per cent. The miscellaneous receipts which in the United Kingdom cannot be considered as taxes, in other countries form some of the most pernicious sources of regal exactions. From these sources the revenue of the United Kingdom receives only about 3 per cent. In Russia they amount to as much as 39 per cent., including the brandy monopoly. In Holland the proportion of these taxes is 24 per cent, in Portugal 17, in France 20, in Austria 16, in Prussia 14, and in Spain 12 per cent.

The classification of direct and indirect taxes is indeed somewhat objectionable, it being often difficult to distinguish between the one and the other. Another classification has been suggested, viz., 1st, taxes on persons; 2nd, taxes on property and income; 3rd, taxes on enjoyments; 4th, taxes on consumption; and, 5th, taxes on deeds: but, for practical purposes, the general classification of direct and indirect, with their natural subdivisions, is perhaps preferable.

Τ

CHAPTER VI.

TAXES ON COMMERCE.

IT is impossible to contemplate the wise distribution

of the produce of the earth, and the variety of skill and industries of its multitudinous inhabitants, without being led to the conviction that it was the gracious design of Providence to constitute of the whole human race one vast family and one entire commonwealth, supplying each other's wants, and administering to each other's comforts. Mutual dependence is the very fulcrum of society. The world is not divided into departments, each possessing all that may be required for the existence and welfare of its own inhabitants. Nature is apparently capricious in her gifts. Here she is rich in metals, there in sugar, and at another place in spices; and though mountains, seas, and deserts, habits and manners, colour and languages separate the various families of the earth, yet there is no chasm or precipice between them. The existing separations are intended to quicken rather than to arrest human energies, to enliven rather than to lull our search for necessaries, for comforts, and for luxuries, in whatever corner of the earth they may be found. It is for man, by every means which science and industry may suggest, to approximate distances, and by a free interchange of pro