MR. GOSCHEN ON THE CARRIAGE-TAX.
THE reply given by Mr. Gamlen on Tuesday to the deputa- tion of carriage-builders and others interested in the Carriage-tax, is a mach more important matter than it looks. It shows that, in the opinion of Mr. Goschen, a most conserva- tive economist as well as a most able financier, a new element has entered into the discussion of the incidence of taxation, or, rather, an old one has assumed quite new proportions. The deputation represented all interested, even indirectly, in the trade, and produced, of course, the regular, and in their way sensible, arguments. The trade was depressed, fewer carriages were manufactured, more second-hand carriages were sold, and, altogether, both manufacturers and operatives were suffering. They thought, therefore, that the special tax on carriages, which, though it is only two guineas a year on one description and fifteen shillings a year on another, hits job-masters heavily, and involves some worry even to private individuals, ought to be remitted. If it were remitted, they believed that the cheaper carriages, upon which the duty presses most, would be in more demand. It is not likely that, with an insufficient revenue, and large expenses possible in the near future a Chancellor of the Exchequer would at any time have listened to the request for remission ; but before the alterations in the suffrage, he would have discussed the proposal from a different point of view. He would have pleaded the necessities of the State, would have minimised the pressure of the tax on the owners of carriages, and would have been especially sympathetic with all who pleaded for the emancipation of the trade. He would, in fact, while refusing the request, have courted the traders in coaches, " the conveyancers," as the late Master of Trinity once humorously suggested that they should be called. Mr. Goschen took another line. While doubting whether the tax was felt by rich owners, and telling the coach- builders that they were no worse off than other people, his main argument was that a carriage was a luxury, that the tax fell on the wealthier classes and not on labour, and that it was therefore inexpedient to abolish it. Like the taxes on men-servants and armorial bearings, it was a tax on the well- to-do ; and as the tax was not heavy, it was better that they should be taxed than the general community on whom any substitute must fall. Mr. Goschen, in fact, like his predecessors, looked first at political economy, and then at the electors, and as the tax does not press on the springs of industry, he understood that, with a household suffrage, the remission would be distinctly unpopular. It would relieve a very few at the cost of the whole population. That was a final answer to the deputation, and though they were pleased with their reception, the wiser among them must have felt as they retired that the prospect of the remission of their tax had faded into that obscure distance of time in which the English Parliament, like the American Congress, may feel its wealth a burden, and be eager to be poor.
Mr. Goschen is entirely in the right. Utterly opposed as we are to the Socialistic idea which would enslave or im- poverish the few without enriching the many, we hold that equality in taxation as between rich and poor is a cardinal principle of good government, and believe that even in England it is as yet insufficiently attended to. It is neglected in a palpable way in the imposition of rates— compare rates in Shorediteh with rates in Belgravia—and even the incidence of the Queen's taxes is not always just. It would not be just at all, but that the grand indirect tax, that en liquor, is voluntarily paid and self-adjusting, and that moral considerations of the first importance prevent its serious reduction. If England cost nothing to govern, it would be better to expend the liquor revenue on public works than to repeal the liquor-taxes ; and it is they, and not the remaining imposts, which really press upon the poor. Counting them, however, as taxes, it is difficult to keep the balance even ; and though the subject is complicated, we believe that, speaking broadly, the following sentence will be allowed by the most experienced statists to be substantially true takes a sixpenny Income-tax to keep the balance between the taxes on those who have incomes and on those who have weekly wages, roughly even. That was the great, and, indeed, the only objection to Mr. Gladstone's proposal to repeal the Income-tax ; and it was a perception of this troth, as we believe, which caused that splendid offer to be received with such indifference. The wage-receivers cared nothing about the impost, and the earners of income, who felt it bitterly, felt also that they ought to pay, and detested rather the method of the tax—which no doubt is objection- able, though the wit of financiers has hitherto devised no remedy—than the tax itself. Under snob circumstances, no tax on a luxury ought to be given up, and the Carriage-tax is distinctly a tax upon a luxury. It is all very well to say that it falls heavily on professional men like doctors, who keep carriages for use ; but so do most of the other taxes—the House- tax, for instance—and all rates. A doctor is always over-housed from professional necessities, and must accept a drawback to his career which has its pleasant side, with as much resignation as he may. As a matter of fact, he pays little in the country for his indispensable vehicle, and in town it is dignity, rather than necessity, which forbids him to use a hansom like everybody else. His brougham is not really a tool, though he thinks of it as if it were.
We shall be told, we dare say, that in pleading for equality of taxation between rich and poor, we have conceded much of the Socialistic case ; but that is not true. The Socialist argument is that the rich man should pay to the State, or rather the community, all his superfluous wealth, which is confiscation, the right to ownership not being limited or affected by amount. It is, however, merely justice that rich and poor should pay to the State the same proportion of their means ; and as the rich man has not two stomachs to be fed or two bodies to be clothed, this can only be done by some method of direct taxation upon all who possess more than a bare maintenance. Of course, the most scientific method is a property-tax ; but that method has inconveniences so great, and in a civilised society so dangerous—for you might tax Art and Literature to extinction, yet leave the holder of diamonds untaxed—that the second-best substitutes, taxes on income and luxuries, are almost universally preferred. Even they, however, create an irritation, which produces constant proposals for their repeal, so strongly supported that Govern- ments in resisting them need all the strength they can obtain from opinion. That opinion Mr. Goschen can now help to form, and we are happy to see that he is forming it in the right direction. The best defence against Socialism is to do justice, and justice requires that the rich should pay certain taxes, to be settled as to amount by experts, which the poor do not. The argument that the amount of the Carriage-tax is small, though, of course, it increases the facility of remitting it, is by itself of little weight. It is, of course, as a rule, a folly to impose a tax which costs more than it brings in—that is to say, if the tax, like the old tax on comfits, is not an outwork of a great source of revenue—but so long as the impost pays, it should be attacked or defended upon grounds of financial principle. A tax on carriages may bring in only £200,000 a year, while a shilling tax on corn may bring £1,000,000 ; and yet the one may be entirely wise and the other entirely indefensible. As a rule, unproductive taxes involve more worry than they are worth, both to officials and the community ; but that is not the case with any of the smaller direct taxes, and a wise Chancellor of the Exchequer, who knows how much the State needs money, how, for instance, the reform of the coinage is impeded by the difficulty of providing even sixty thousand a year for a new purpose, will be slow to surrender any of them except to a general demand. Something must be taxed ; and in these times, at all events, those who hire carriages, or keep men-servants, or use armorial bearings, have only to be thankful that they can afford those entirely voluntary luxuries.
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