importers' profits. The retailers' were a matter of estimate with him. We have supposed that they might be somewhat too high, and have therefore placed them at twenty per cent. This, considering that it is to be applied to all retail sales, not only in cities and towns, but in the most remote districts of the country, is undoubtedly within actual limits. As long ago as 1849, we made such investigations as satisfied us of the correctness of the estimates we now give, and published tables at that time, illustrating the principle laid down. In regard to customs duties, then, we cannot but conclude, that, while they are a convenient and prolific source of revenue, they are very unequal and expensive, and little in accordance with the principles of justice and equality. BOUNTIES. At this point, it may be most proper to speak of the effect of bounties. If a home product is to be encouraged by government, it is desirable that it should be done as economically as possible; or in such a manner as to impose the least taxation and loss upon the public, while it shall be as effective as possible in securing the object. Let us take the sugar crop of 1858, just referred to, as an illustration. It amounted to $25,000,000. To protect this to the amount of twenty-four per cent, the people paid, as we have shown, $14,300,000, of which the government realized but $4,968,000. Here was a clear loss to the consumers of $9,332,000. Suppose, now, that instead of this protective duty of twenty-four per cent, a bounty of equal amount (twentyfour per cent) had been paid by the government. The matter would then stand thus: twenty-four per cent on $25,000,000 is $6,000,000, which the people would pay to the sugar growers, instead of $9,332,000 they were obliged to pay through protection; a saving of $3,333,000, equal to thirty-three per cent of the amount paid under the protective system. This principle applies, in all cases, where an article is actually protected, and shows that bounties are by far the most economical form of governmental assistance. Bounties, as a means of protection, have been but little resorted to by governments. The reason is obvious. The evident injustice of giving to one class of men a premium upon their productions, in order that they may be encouraged in a branch of industry that cannot live without contributions from the public treasury, is so apparent, and evidently unreasonable and unwise, that the people of no country would long tolerate it. It is, therefore, vastly more feasible to give protection by duties on the foreign article, although much more wasteful and onerous. EXCISE. Excise are the opposite of custom-house duties, being laid wholly upon articles of domestic production, and paid first by the producer; and, after the articles have passed through the hands of the merchants, with their profits added, the sum total is paid by the consumers. This mode of taxation is obnoxious to the same objections that may be made to customs. Excise is unequal, because it falls on rich and poor alike; not in proportion to their wealth, but what they consume. The merchants' profits are not quite so large on these as on custom duties, because home products do not ordinarily pass through as many hands as foreign merchandise. The expense of collection, though only perhaps about one-fourth part as great, is still a heavy charge upon the revenue; but the most popular objection to excise is the espionage which it necessarily requires. It is, notwithstanding, a very productive source of revenue, and must be resorted to by governments heavily indebted. Domestic manufacturers are not injured by excise duties, unless they so increase the cost of their commodities as to expose them to foreign competition. Profits upon such duties are charged upon commodities as a part of the general expense of their production. TAXES ON DISADVANTAGEOUS CONSUMPTION. The principle has everywhere been acted upon by governments, that heavy taxes are to be laid on commodities "the consumption of which is especially prejudicial to the interests of the people." This is in accordance with our fifth maxim. There are two strong and sensible arguments in favor of this kind of taxation. One is, that, if it should cause a fall ing-off in the consumption of the articles so taxed, no detriment would come to individuals or the public; but, on the other hand, their moral and social condition would be promoted, and the power of production increased. The other consideration is, that all those who choose to abstain, as they can do without injury, from the specially taxed articles, will avoid the payment of the tax altogether: such taxes are voluntarily assumed by those who pay them. This kind of taxation is found to be far more productive, in proportion, than any other; and consumption is less affected by heavy imposts. According to Professor Levi, the working classes of Great Britain pay over ten millions sterling annually, in taxes upon tobacco and intoxicating drinks. The whole amount raised upon these two articles in 1858 was as follows: British and foreign spirits and wine. £18,500,000 5,500,000 £24,000,000 or about one hundred and twenty millions of dollars, equal to four dollars to each inhabitant; or, allowing five persons. to a family, twenty dollars to each family. More than a third part of the whole British revenue is raised by the taxes upon these articles alone; a remarkable fact, especially worthy the attention of the American government at the present time. STAMPS. There is still another mode of supplying the treasury; viz., by the sale of stamps. This is an important branch of the public revenue in all highly taxed communities. Stamps are required upon all letters, newspapers, and other matter carried through the mails; upon all bills of merchandise and bills of lading; upon legal instruments of every name and nature; upon patent medicines, &c. This is cheap and efficient, and as desirable as any form of indirect taxation. Of course it bears unequally upon different classes, and is more or less vexatious, particularly when first introduced; but habit will, after a while, reconcile the people to it, and it is as little likely to be resisted or evaded as any other form of exaction. It is also collected with very little expense, as no functionaries are necessary. It should therefore be carried out, as far as practicable. The British government raises a large sum in this way eight millions sterling are received for stamps. The United-States treasury received, for the year ending June 30, 1865, the sum of $11,162,392. LICENSES. These are granted by both national and State authority, for a great variety of purposes. It is a more economical and convenient mode of raising a revenue than by excise on manufactures, &c., requiring only annual renewal. There is also less opportunity for fraud and evasion. It is therefore a very desirable form of taxation; and the United-States government has already availed itself of this mode of raising revenue, to the extent of $12,613,478 for the financial year 1865; and this sum may doubtless be greatly increased in the future. i CHAPTER XI. NATIONAL TAXATION (continued). — INCOME TAX. It is unnecessary to say that this tax is in perfect accordance with the first maxim laid down by Adam Smith, that "every man should be taxed according to the revenue he derives under the state," and also consistent with every other principle we have stated. It is "clear and plain" to the contributor, and every other person. The income-tax payer knows when and how much he pays; and it can be collected as conveniently and economically as any other. This kind of tax was established in England in 1798, during the wars with Napoleon, but was abolished soon after the close of that struggle. About 1842, however, the government, finding its revenues fall short of the expenditures, restored the tax; and it has been continued to the present time. This tax was unknown, we believe, in the United States, until the civil war, when it was laid by Congress, and has been continued thus far. Total amount collected for the year ending June 30, 1865, was $20,740,451.33; while the whole internal revenue, for the same time, was $211,129,529.17; so that the income tax produced nearly ten per cent of the amount. Of all modes of taxation, this is the most just and equitable. Every man can afford to pay according to his income, and ought to do so. There is no other perfect standard of taxation; none other which does not inflict more or less hardship and injustice. The tax comes upon the annual private revenue of each year, out of which the government should receive its share for the annual revenue of the state. If the private revenue is increased, so should be the contribution to the public rev |