TOPICS OF THE DAY.

A SLIDING SCALE FOR THE INCOME-TAX.

Tug tax—the tax—is still the theme in all mouths, as it will be until it be settled. There is one advantage in the visitation of new taxes, that it makes people think, for the first time in a quarter of a century, upon the subject of taxation. Taxes indeed have been paid all that time; but then, the best-taxed people in the world had become used to them. Taxes have been taken off too : well, they were a trouble got rid of, and there was neither use nor plea- sure in talking about them. The imposition of fresh taxes is a very different thing : every possible question is extorted by the fear of payment,—what tax is it to be ? how is it to be imposed ? how levied ? by whom ? of whom ? why? what for ? Tongues and pens have been engaged in ceaseless activity on the exhaustless theme, novel to the generation ; and it is somewhat humiliating to find how much at sea " the march of intellect" has left us on this " truly English" question. After turning it in every possible way, nobody seems to know very well why there should be taxation, who is to pay, or even what taxation is !—the only point of agree- ment being, that, whatever it is, taxation is surely an evil, and that it should be made as small as possible, and so ingeniously con- trived as to press everywhere and nowhere. Many suggestions have been offered to make the burden easy and justly apportioned to the varying strength of different classes to bear it ; and below is the proposal of a correspondent of our own, which is as practical- looking as any. The writer is a man of learning, sagacity, and benevolence, and one whose position brings him into intimate con- tact with the several classes ofrespectable society. He has planned a mode of adjusting the tax so as to throw the weight in an in- creasing ratio upon the largest incomes. Various objections to any such apportionment will be found ready-made. It is said to be unfair to the rich, as imposing upon them an unequal burden. Mr. Prrm put this sort of argument in its most marketable shape, when he said, that if you take 501. from a landed proprietor whose estates return him 5001., and 501. from a man whose income is derived from industry, that is as equal as can be ; for 450/. a year is left to each. So that it is the same to take 501. from a man who will certainly have 500/. a year as long as he lives, with some 10,000/. worth of land to leave his progeny that they may have 500/. for all time, as to take 50/. from a man who last year earned 500/. but may never again earn a shilling ! The proposition is a self-evident absurdity.

It is said that to lay a tax in a direct ratio to the amount of wealth, would check accumulation, and drive capital abroad. This is a refinement of political economy of no great practical force. It is not very likely that the man whose prudence impels him to save 1001. a year will neglect to save that sum because a percentage on its next year's interest must go to the Income-tax. So prudent a man is more likely to save a further fraction to redeem the tax on his clear 1001. ; to make additional exertion to contribute his quota to the state without diminishing his permanent resources.

Capital is not driven abroad by the dislike to any liability on ac- count of its name. It will be driven abroad if there are not so many advantages for its investment at home—less profit, or less security. From the annual interest of 100/. invested in the British Funds the new Income-tax would deduct something less than Is. 10d.; not per cent—not the amount of an hour's fluctuation any day in the week I But the substantial proof of the shadowy nature of this check to investment at home, is the fact, that the Funds rose in price as soon as it was known that they were to be taxed. The additional security felt on 'Change caused a rise in value which more than covered the tax itself.

Still it is objected, that to hold up the rich as fitter objects for taxation than the poor, points to an ulterior procedure—to confisca- tion: if the rich may be taxed, they may hereafter be despoiled. The consequence is so remote as scarcely to affect the working business of this day. It is rather an argument in politics than in political economy ; and it is absorbed and lost in similar arguments of a larger kind. The safety of property and its possessors must rest on the intelligence of the people and the justice of their laws : are the English people so far intelligent in comparison with others, and their laws so far just, as to make property as secure here as elsewhere ? Truly, we might lose a good portion of our cha- racter in both respects, and yet not sink so low as some great nations that might be named; and yet in none of those countries is there any talk of confiscating the property of the rich. There once was, indeed, such a talk, in a country close to us ; but it was not at all raised by the rich being more taxed than the poor—there was certainly no example of that kind to suggest confiscation to the Revolutionists of France, but the very opposite. Our own rich have done, and still do, worse things than submit to peculiar taxation, without any threat of confiscation. Many other provo- cations must be exhausted and removed, before the submission to a tax would stand as the foremost provocative to revolutionists in decreeing a general confiscation of property. The rich may be as- sured that there is nothing to menace their safety though they concur in the policy and justice of assuming a larger share of the burden which they have a larger share in imposing.

OUR CORRESPONDENT'S PROPOSAL.

Men's wits are now fairly at work, in town and country, on the pro- posed Income-tax. As was to be expected, individuals and classes are sharp-sighted, each in his own particular case, in discovering uneven- banded justice in the blow which the measure deals to them. The pro- fessional man, the annuitant, the merchant, the man with a large family and small means,—these, and sundry others, many of them admitting the policy and necessity of such a tax, are crying out, nevertheless, for some modification, which will shift what appears to them their un- fair share of the burden from their own shoulders. It cannot but be admitted, too, that most of these pleas have something more in them than a show of reason. Taken separately and apart from the whole scheme, they have many of them so clear a foundation in equity, that no question could be raised about modifying the measure, to correct the inequality. But, looking at the scheme as a whole, is it practicable? is it possible to do this in all or in the greater number of instances? The more the measure is regarded as a whole, the more, I do believe, it will appear that no attempt to adjust it equally to the endless varieties of income is practicable, or is likely to produce any other result than a shifting of the injustice. We may, no doubt, so modify the tax that it shall be as fair to A as to B ; but this will only augment the injustice of which C and D complain, or create a new case of injustice and com- plaint. It is not merely that the arrangement would be decult : this alone would not be a sufficient objection. It would be the duty of the Minister to submit to any reasonable amount of trouble and perplexity, if the issue were likely to be fairness and contentment. It is the utter impracticability of so modifying the tax as to adjust it fairly to the different hinds of income that we have to deal with.

It may, hoWever, be worth while to consider, whether, in another point of view, the tax does not admit of being so laid on as to press more lightly where its pressure would be sorest and most injurious to the community, and more heavily where there is strength to bear it. Why should there not be a graduated scale for the Income-tax ? It has this recommendation on the face of it, that the principle is already re- cognized in the case of the Assessed Taxes. The man who has three or four carriages is not merely assessed to three or four times as much as the man who has one carriage, but in an increasing proportion. Why should not this ascending scale be adopted in the application of the Income-tax ? It would require no different machinery from that which a uniform tax would have; it would not be one whit more inqui- sitorial or more complex : and, really, when we come to reflect on the nature of the retrenchment which an Income-tax may render necessary in the case of small and of large incomes respectively, it is something more than the pinch of the shoe—the individual privation—in the one case as compared with the other, that makes it a matter worthy of a statesman's consideration. The man of 5,0001. or of 50,0001. a year has perhaps been accustomed to spend his whole income; but what are the retrenchments which the tax will impose on him?—the cutting off of a few luxuries ; the interruption of some expensive habits ; the pruning of elegancies. The man of 300I. or 4001. a year, who is more likely to be spending the whole of his income now—if he is to retrench, it probably must be by withholding from one of his children three years of education, or stinting his family in some necessary expenditure, or diminishing the number of those conveniences on which he now pays an assessed tax, in order to contribute the same sum to the public revenue in a more galling shape. In this latter case— which will not be uncommon—the individual will suffer, and the public gain nothing. What is unavoidably evil in an Income-tax ought, if that tax appear to be called for, to be borne manfully and uncomplain- itIly by all alike : but justice and the common welfare require, that no pains should be spared to remove all that is removable in the evil. I am very much disposed to think that a graduated scale would bz-tf-nti St - the readiest and most efficient modes of doing this. In attempting to do justice to all the several hinds of income, the interest of one claimant is jostling against the interest of another ; but here is a measure of relief which would apply equally to all the classes on whom an Income-tax will press severely ; and a measure, as has been observed, founded on the very principle of the Assessed Taxes. The great objection to a graduated tax—the trouble to individuals, and the prying into their affairs—must be submitted to under Sir Robert Peel's Income-tax, both by those who pay and by those who claim to be exempt.

To illustrate what is meant, suppose a scale graduated thus.

Let the lowest amount of tax be a halfpenny in the pound, and the smallest income taxed be one hundred pounds. Then let the scale be-

* INCOME. X TAX PER POOND.

200 300 100 200 a halfpenny.

300 and under 400 a penny. a penny-halfpenny.

400 500 twopence.

The tax increasing thus by a halfpenny per pound for every additional 1001. of income, up to 2,0001., which according to this scale would be taxed teupence per pound.

2,000 2,500 tenpence. 3,000

2,5001 and under .{-3,000 3,500 tenpence-halfpenny.

elevenpence. The tax increasing thus by a halfpenny per pound for every additional 5001. of income, up to 5,0001., which according to this scale would be taxed one shil- ling and one penny per pound.

5,000 (6,000 one shilling and a penny.

6,0001- and under {7,000

7,000 (8,000 one shilling and a penny-halfpenny.

one shilling and twopence.

The tax increasing thus by a halfpenny per pound fur every additional 1,0001. of income, up to 10,0001., which would, according to this scale be taxed one Hog and threepence halfpeouy.

10,000 (15,000 one shilling and threepence-halfpenny. 15,000 and under {20,000

25,000 one shilling and fourpence. 20,000 one shilling and fourpence-halfpenny. The tax increasing thus by a halfpenny per pound fur every additional 5,0001. of income, up to 50,0001., which according to this scale would be taxed one shilling and sevenpeuce-halfpenny.

50,000) and under [60,000

one shilling and sevenpence-halfpenny.

60,000f 70,000

one shilling and eightpence.

The tax increasing thus by a halfpenny per pound for every additional 10,0001. of income. until it amounts to two shillings per pound, or 10 per cent, (the old Income-tax,) which should be the maximum.

We should not be far from the mark, I think, in saying that the amount of revenue derivable from this graduated scale would be equal to that from a uniform sevenpenny tax. The gradations of the scale, however, may, it is obvious, be easily altered, if more accurate data than those on which the calculation has been made were to render it necessary ; so that the tax should still be neither a grievance toindtvi- duals nor divert expenditure from those channels through which the expenses of individuals contribute to the common good. A uniform Income-tax would certainly do this, not in insulated cases alone, but throughout whole classes. I may instance the great body of the clergy—family men, whose incomes range from 1501. to 400/. How many of these will be able to contribute, as they now do, to the support of schools for the poor, and to the many benevolent enterprises which so deeply affect the eharacter and condition of the people at large? I may instance another class consisting of half-pay officers ; another of single ladies and widows,—persons whose slender incomes are so barely sufficient for what to them are the ordinary conveniences of life, that it would be difficult to say what the self-denial is that must be practised in order to furnish the 3 per cent quota Throughout these classes of the community, a graduated tax would be hardly felt. It so happens, too, that, speaking generally, the classes on whom a uniform tax would press so injuriously, are just those who are most likely to be quiet and uncomplaining when the tax is laid on, but whose subsequent discontent may seriously embarrass the Government. Who can say that at the end of three years the state of our foreign relations will allow the Prime Minister to repeal the Income-tax? Is it not sound policy, then, as well as equity, that it should be laid on in the first in- stance as free from oppressiveness as its nature will admit? Let Sir ROBERT PEEL do this, and his measure will be safe from the mere party insinuations that it gives rise to,—of his having exempted incomes under 1501. to avoid the resistance of the masses and the ten-pound voters; of having thrown a sop to the Irish constituencies in favouring the resi- dent in Ireland and punishing the unpopular absentee, (a part of the scheme, by the way, which it will be very difficult to make efficient.) Above all, he would remove every ground for the imputation of sparing that wealthier class to which he himself belongs, and requiring of the less wealthy classes what in their case alone would be a sacrifice. He is right to contemplate a speedy termination to the tax ; but he will be wanting in his usual prudence if be do not so shape it as to diminish the difficulty of extending its term if the exigencies of the state should require it.

There is one point more on which I will venture a remark—the appli- cation of an income-tax to the Sovereign. It will be done, no doubt, at the Queen's desire; but I think that it ought not to be regarded in the light of a tax on her. The Sovereign has no private income, but that which, to mark the distinction, is called the Privy Purse; and even that is not on a footing with any other income, private or official. The Sovereign represents the nation in the application of a certain portion of its expenditure. As a measure of national retrenchment, it may, or it may not be expedient that that expenditure should be diminished ; but it ought not to be considered as a legitimate object for taxation; and if curtailed, it should not necessarily be curtailed on the principle adopted for the tax—it should be done simply as an act of economy.