^".s#^.; 
 
 
 MM
 
 irt2£ dssau. 
 
 LOCAL TAXATION: 
 
 ^11 a?5'sag 
 
 ox THE INJUSTICE, INEQUALITIES, AND ANOMALIES OF 
 THE PRESENT POOR-RATE ASSESSMENT, 
 
 THE INCIDENCE OF OTHER LOCAL BURDENS IN ENGLAND 
 AND WALES. 
 
 BY 
 
 CHRISTIAN F. GARDNER, B.A., Caktab., 
 
 STOKE DAMEREL, DEVON'. 
 
 TO WHICH ¥AS AWAEDED THE PEIZE OFPEEED BY TEE 
 
 LOCAL TAXATION COMMITTEE. 
 
 " This is not the cause of faction, or of party, or of any individual, but the 
 common interest of every man in Britain." — Junius. 
 
 PUBLISHED BY THE LOCAL TAXATION COMMITTEE, 
 
 At the office of "Chamber of Agriculture Journal," 
 
 21, AEUNDEL STEEET, STEAND, W. 
 
 Frice Id. each {'post free 3c7.), or 16s. ver 100.
 
 r. ETNTLEr AST) CO , PEINTEKS, SHOE LANE, FLTSr.T STREET.
 
 CONTENTS. 
 
 CHAPTEE I. 
 
 Introductory Eemarks — Summary of the History of the 
 Poor-laws to the Act 48rd Eliz., c. 2 — Application of 
 this Act modified by the Exemption Act of 184:0 — 
 Inequalities of Local Taxation arising from the differ- 
 ent systems of valuation .... Pages 7 — IS 
 
 CHAPTEE II. 
 
 The different kinds of property subject to Local Taxation, 
 with the incidence on landlord and tenant, yeoman or 
 small proprietor, and beneficed clergy respectively, 
 where land is the subject of taxation — Local Taxation 
 a discouragement to the investment of capital in 
 agriculture — The removal of protecting duties renders 
 it unjust to continue a special tax affecting agricul- 
 ture — Injurious effects of this injustice on the com- 
 munity — Incidence on landlord ap.d tenant where 
 Tiouses, sJiojJs, and factories are the subjects of the 
 rates — The proportion of Local Taxation paid by 
 manufacturers and tradesmen is in an inverse ratio 
 to their wealth — The Imperial Income-tax justly
 
 IV CONTENTS. 
 
 levied on the contrary principle — The fact of high 
 rates being levied on small houses discourages the 
 building of cottages for the poor, and is injurious to 
 labour and morality — Incidence on railways, coal- 
 mines, quarries, gas and waterworks, and the 
 injurious effects upon the community. . Pages 19 — 34 
 
 CHAPTEE III. 
 
 Statements and Tables, showing that the whole of the 
 Local Taxation of the country is paid out of less than 
 one-third of tlie income charged with Income-tax ; but 
 the Income-tax returns do not represent the actual 
 income of the country, which amounts to about 676 
 millions, whereas local rates are levied on about 100 
 millions and a half— Tables showing the amount of 
 Imperial Taxation (with certain exceptions) paid by 
 real property as compared with the amount paid by 
 other property — Tables showing the unequal incidence 
 of aggregate taxation, Imperial and Local, on the 
 community, divided into four classes, viz., owners of 
 real property, occupiers of land, occupiers of real 
 property other than land, and the manual labour 
 classes — Statements showing fraudulent returns under 
 Schedule D — Mr. Grlad^tone's argument against 
 exemptions directly applies to Local Taxation. . 35 — 45 
 
 CHAPTER lY. 
 
 The argument refuted that rates are no taxation, but 
 a rent charge — The value of real projjerty has not 
 increased in an equal ratio with that of other pro- 
 perty — Mr. Mill's theory refuted that the increase in 
 value of real property might be appropriated by the 
 State — The growth of pauperism and consequent 
 burden upon land and houses, commensurate with the 
 increase of wealth in the commercial and professional 
 
 , UIUC 
 
 '*t»7pl>
 
 CONTENTS. 
 
 classes — This fact explained — The injustice of land 
 and houses supportiDg the trade-made poor — Income 
 derived from funded property ought to be rated — 
 Eeal property has no longer any exclusive privileges 
 to justify its bearing all Local Taxation. . Pages 46— 54 
 
 CHAPTER Y. 
 
 The objects to which the proceeds of Local Taxation are 
 applied are twofold, national and purely local — 
 Formerly real property constituted nearly the whole 
 wealth of the country — Xow the commercial and 
 moneyed interest has increased enormously, and ought 
 to share the burden of Local Taxation — The question 
 affects ratepayers generally, whether living in towns 
 or country ; and, contrary to the first principles of 
 taxation, the burden presses most on those who have 
 narrow incomes — The false issue raised by advocates 
 of the present system exposed .... 55 — 58 
 
 CHAPTER VI. 
 
 Suggestions for the reformation or removal of the griev- 
 ances of the present system of Local Taxation — These 
 could not be removed by a grant-in-aid from the Con- 
 solidated Fund — But the injustice, inequalities, and 
 anomalies might be remedied by a national rate levied 
 on the basis of the Income-tax assessment, with 
 certain modifications and exemptions — Objections 
 answered and benefits shown — Reference to the system 
 adopted in the United States of America . . 59 — 64
 
 VI CONiENTS. 
 
 LIST OY TABLES. 
 
 Table L Poor-rate Expenditure, 1868 . . Page 12 
 
 Table II. Local Taxation in England and Wales falling 
 
 on real property, 1867-68 ... 13 
 
 Table III. Hate in the £ and per cent, of Local Taxation 
 on " Gross Estimated Pt ntal " and " Pate- 
 able Yalue " U 
 
 Table lY. Showing the inequalities arising from dif- 
 ferent systems of valuation ... 18 
 
 Table Y. Pate in the £ of Local Taxation on the in- 
 comes of various occupations of the com- 
 munity ....... 33 
 
 Table YI. Approximate income of all classes in Lug- 
 land and AYales 3S 
 
 Table YII. Imperial Taxation, 1868 .... 38 
 
 Table YIII. Imperial Taxation, 18G7-68, falling on real 
 
 property ....... 39 
 
 Table IX. Incomes of the community classified . . 42 
 
 Table X. Pates per cent, at which the incomes of the 
 comanunity are charged to Imperial, Local, 
 and asirrec:ate taxation .... 43
 
 LOCAL TAXATION 
 
 AN ESSAY. 
 
 CHAPTER I. 
 
 A Committee of the National Assembly, appointed to inquire Introductio.n 
 into the state of tlie poor in France, described our Poor-law 
 system as " La plaie politique la phis devorante de V Ancjleterre " *; 
 and at that time there were many Englishmen who re-echoed this 
 opinion. In these days few would venture to assert so odious a 
 calumny ; and it is now almost universally acknowledged that it 
 is the duty of a civilized country to make a legal provision for its 
 poor. In England the legislature has given to the poor an abso- 
 lute right to relief. 
 
 The duty of providing for the impotent poor was first recog- Historical 
 nized in the year 1388 1; but vagabondage and mendicity were 
 treated with the utmost rigour. In the times of the early Tudors 
 the feudal power of the nobility had been undermined by the civil 
 wars between the rival houses of York and Lancaster ; and the 
 abolition by Henry VII. of the system of " maintenance " had 
 compelled bands of lawless men, hitherto supported by the nobles 
 in idleness, to seek their own living. 
 
 The suppression of the religious houses by Henry YIII., and 
 the consequent extinction of the charity which they had been 
 accustomed to exercise, removed a great source of relief to the 
 poor, and the country swarmed from end to end with able bodied 
 mendicants. The sole idea of English rulers appears to have 
 
 * The most wasting sore in tlie political system of England. 
 1 12 Eic. II. c. 7. '
 
 b LOCAL TAXATION. 
 
 been to treat pauperism as a crime. Whipping, branding, and 
 even death were the penalties inflicted upon the sturdy beggar 
 under the statutes of Henry YII. and Henry VIII. These enact- 
 ments defeated themselves by their own severity. People did not 
 like to enforce them. In the reign of Edward VI. (a.d. 1551) a 
 milder act was passed. It appointed collectors of alms, who were 
 " gently to ask of every man and woman at church that they of 
 their charity should give weekly to the relief of the poor "; and 
 if any, who were able to give, refused to do so, the bishop was to 
 send for the recusant, and use " charitable ways and means." This 
 voluntary system of poor relief does not appear to have been effec- 
 tual. It remained for the wise and sagacious statesmen, who 
 guided the councils of Queen Elizabeth, to devise measures for the 
 management of the poor, which admirably answered the ends of 
 humanity and utilised the immense labour power of the country, 
 which, whilst unemployed, was a curse instead of a blessing. In 
 the year 1563, an Act* was passed empowering justices of the peace 
 to tax at their discretion any one who refused to give voluntarily 
 towards the maintenance of the poor ; and in default to send him 
 to jail. At length, in 1601,t the Act was framed and passed which 
 has formed the foundation of the Poor-Law system to the present 
 time. And, as in the following pages frequent reference will be 
 made to this statute, it is here quoted : — 
 
 ippoinLn.eut " Be it enacted by the authority of this present Parliament, 
 
 ifortheroor, that the churchwardens of every parish, and four, three, or 
 
 md their duty. ^^^ substantial householders there, as shall be thought meet, 
 
 having respect to the proportion and greatness of the same 
 parish and parishes, to be nominated yearly in Easter week, 
 or within one month after Easter, under the hand and seal of 
 two or more justices of the peace in the same county, whereof 
 one to be of the quorum, dwelling in or near the same parish, 
 or division where the same parish doth lie, shall be called 
 overseers of the poor of the same parish ; and they, or the 
 greater part of them, shall take order from time to time, by 
 and with the consent of two or more such justices of peace 
 as is aforesaid, for setting to work the children of all such 
 whose parents shall not, by the said churchwardens and over- 
 * 5 Ellz. c. 3. t 43 Eliz. c. 2.
 
 LOCAL TAXATION. 
 
 seers, or the greater part of them, be thought able to keep 
 
 and maintain their children ; and also for setting to work all 
 
 such persons, married or unmarried, having no means to 
 
 maintain them, and use no ordinary and daily trade of life 
 
 to get their living by ; and also to raise weekly or otherwise 
 
 (by taxation of every inhabitant, parson, vicar, and other, }Vlioareto 
 n • *' P 1 1 1 • 1 • • ^® taxed for 
 
 and of every occupier oi lands, houses, tithes impropriate, the relief of 
 
 propriations of tithes, coal-mines or saleable underwoods, in ^'^^ P°°^' 
 the said parish, in such competent sum and sums of money 
 as they shall think fit), a convenient stock of flax, hemp, A couveuient 
 wool, tliread, iron, and other ware and stutF, to set the poor p^l^^'^gj totet 
 on work ; and also competent sums of money for and towards the poor on 
 the necessary relief of the lame, impotent, old, blind, and 
 such other among them being poor, and not able to work ; 
 and also for the putting out of such children to be appren- 
 tices, to be gathered out of the same parish, according to the 
 ability of the same parish, and to do and execute all other 
 things, as well for the disposing of the said stock, as other- 
 wise concerning the premises, as to them shall seem conve- 
 nient." 
 
 Can any unprejudiced mind doubt that the spirit of this Act The Act 
 intended every inhabitant to contribute according to the means inhabitant to 
 which he possessed ? It is impossible to suppose that the framers ^^ *^^^ ^^ 
 of it intended to depart from what had been the custom clearly his ability. 
 established by preceding statutes, that universal contribution was 
 expected according to every man's ability. By the Act of Edward YI. 
 the contribution was voluntary ; and a moral pressure only could 
 be brought to bear against a non-contributor. By the Acts of the 
 5th and 43rd of Elizabeth the contribution was made compulsory 
 and the tax was legally recoverable. 
 
 The Statute expressly mentions both "inhabitants" and 
 " occupiers " which would seem intended to include both residents 
 and non-residents ; so that none should escape. Inhabitants, as 
 such, were to be rated according to their ability, and occupiers of 
 property, even if non-resident, were to be liable in respect of that 
 property. This interpretation would make trades, professions, 
 and personal property rateable as well as real property; and the 
 Act was so interpreted by the Committee of the House of Lords
 
 10 LOCAL TAXATION. 
 
 appointed in 1850 * to inquire into the Parochial Assessment 
 system. The 6th resolution of the Committee states :— - 
 
 " That the relief of the poor is a national object, towards 
 which every description of 'property ought justly to be called 
 upon to contribute, and that tlie Act of 43rd Elizabeth, c. 2, 
 contemplated such contribution according to the ability of 
 every inhabitant." 
 
 This inte]ition was carried out to some extent in the 18th 
 century, for in the last legal decision (it. v. Lumsdaine), we find 
 Chief Justice Little dale saying, 
 
 " Hitherto, rates upon inhabitants in respect of personal 
 property, have been in practice confined to stock-in-trade 
 and shipping." 
 
 But the assessment of stock-in-trade has since been abandoned 
 as impracticable, it being nearly always impossible to ascertain 
 its rateable value ; and moreover, the owner was subjected to the 
 vexatious and inquisitorial visits of the overseer. The great 
 inconvenience caused by this state of things, led to the passing 
 of the Exemption Actf in 1840, which is still periodically renewed. 
 This Act provided that no inhabitant should be rated for his 
 stock-in-trade or other personal property ; and as Sir George 
 Cornewall Lewis said in his evidence before the Committee of 
 the House of Lords in 1850, it suspended '' the rateability of in- 
 habitants in respect of the ability of the parish." "We may there- 
 fore consider the word '' inhabitant " as practically struck out of 
 the Act of Elizabeth. The ratepayer is now charged in his character 
 of occupier oniy ; except in those comparatively few cases (to be 
 hereafter noticed), J in which the rates are paid by the owner, 
 under the " Poor-Hate Assessment and Collection Act, 1869." 
 It may be remarked, however, that, as the Exemption Act is 
 passed for limited periods, and renewed from time to time, the 
 Government does not deny the principle that personal property 
 should contribute to the Poor-rates. 
 
 The Poor-rates, as established by the 43rd of Elizabeth, were 
 
 * Committee of House of Lords ou Parochial Assessments, 1850. 
 t 3 & 4 Vict. 0. 89. X P. 37, infra.
 
 LOCAL TAXATION. 11 
 
 originally intended solely for tlie relief of the poor : but, as tlie Various 
 system affords a convenient basis for collection, various other j^ave been en- 
 rates, all of which are national in their objects, have been at ^T*^*®^ ^^ *^^ 
 
 ' 1 roor-rates. 
 
 various times engrafted on the Poor-rate ; and at the present 
 
 time, under the name of Poor-rates, the occupiers of real property 
 are taxed for many objects totally unconnected with the relief of 
 the poor. This will be seen from the following Table, '* which is 
 compiled from the 21st Annual Keport of the Poor-Law Board. 
 Appendix C, Nos. 23 and 24. 
 
 '■^ See Table T.
 
 12 
 
 LOCAL TAXATION. 
 
 
 
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 LOCAL TAXATION. 13 
 
 From this Table it may be observed that one-tbird of tbe 
 whole amount levied as Poor-rates is expended for purposes 
 unconnected with the Belief of the Poor. 
 
 But, besides these various rates which are all included under 
 the title of Poor-rates, there are others, all of which are charged 
 upon the same kind of property, and which, with Poor-rate levy, 
 make up the Local Taxation of England and "Wales. 
 A summary is given below in Table II. 
 
 TABLE II. 
 
 Local Taxation in England and Wales fallinrj on Beal Property, 
 1867-68.* 
 
 1. Amount levied under the name of Poor-rates £ 
 
 (see Table I.) 11,054,513 
 
 2. Amount levied for County, Hundred, Borough, 
 
 and Police-rates, in cases where these are 
 
 not paid out of Poor-rates 307 232 
 
 3. Highway-rate, where separately levied 916 779 
 
 4. Church-rates 217,038 
 
 5. Lighting and "Watching-rates 76,978 
 
 6. Improvement Commissioners 445,431 
 
 7. General District Rates under Public Health Acts 1,736,247 
 Dittof ditto ... 60,443 
 
 8. [Rates under Courts of Commissioners of Sewers, 
 
 including Drainage and Embankment-rates ... 695 810 
 Dittot ditto ... 13,261 
 
 9. Eates of other kinds, including a sum of £981,140 
 
 levied in the Metropolitan District for Greneral 
 
 and Lighting Eates 1,203,397 
 
 £16,727,174 
 
 N.B. It will at once be seen that items 1 and 2 in this Table 
 are national in their objects, the remainder being local. This 
 portion of the subject is treated fully at pp. 55, etc. 
 
 It should be here noted, that there is a discrepancy of 
 ♦ Local Taxation Eeturns, 497, and f 497— L
 
 14 
 
 LOCAL TAXA.TIOX. 
 
 £6,089 between the total in Table II. and that given hy the 
 Local Taxation Eeturns (497 — I). It is thus accounted for: 
 The amount of Poor-rate levied in 1868, as shown in the 
 Twenty-first Annual Eeport of the Poor Law Board, was furnished 
 by the Clerks of the Gruardians, and is £11,054,513, being 
 £6,989 less than tlie sum shown in the Local Taxation Eeturns, 
 the particulars of which were furnished by the Overseers of each 
 separate parish, and amount to £11,061,502. In. Tables Land 
 IL, the amount of the Poor-rate levy is taken from the Eeport 
 of the Poor Law Board. 
 
 Let it be kept in mind, that the whole of this enoraious 
 amount of Local Taxation, given in Table II. , is levied upon real 
 property only ; and, in order to sliow more clearly how heavily 
 such property is taxed, Table III. gives the average rate in the 
 pound, and the average rate per cent, paid by the property 
 assessed to Local Taxation. 
 
 TABLE III. 
 
 Local Taxation, 1867-68. 
 
 Gross estimated Rental of Property assessed* £118,334,081 
 
 Eateable value of ditto* 100,612,734 
 
 Total Local Taxationt 16,727,174 
 
 Amount of Poor-rate levy J 11,054,513 
 
 Amount expended in actual relief to the VgotI . . . 7,498,059 
 
 Average Eate in the Pound 
 of Total Local Taxation . 
 
 „ Poor-rate Levy 
 
 „ Actual relief to the 
 Poor 
 
 On Gross 
 Estimated Rental. 
 
 d. 
 
 9-9 
 10-4 
 
 On Eateablt 
 Value. 
 
 d. 
 
 3-9 
 2-4 
 
 1 5-9 
 
 * Local Taxation Retnrng, 
 
 t Table IT. 
 
 X Table I.
 
 LOCAL TAXATION. 15 
 
 On Gross ; On Eateablc 
 
 Estimated Eental. Value. 
 
 Average Rate per cent. £ £ 
 
 of Total Local Taxation . 14i j IQf 
 
 „ Poor-rate Levy 9t2 11 
 
 ,, Actual relief to tlie l 
 
 Poor ' 6h 
 
 In order rightly to understand the subject of Local Taxation, 
 it is necessary to have a clear conception of what is implied by 
 the terms, " gross estimated rental " and " rateable value." 
 
 The " gross estimated rental " is " the rent at which Explanation of 
 the hereditament might reasonably be expected to let from mated Eental" 
 year to year, free from all usual tenant's rates and taxes, y^ " ?;^^®^^^^ 
 and tithe commutation rent-charge, if any.''* 
 That is to say, it is the rent, not including rates and taxes, 
 which a tenant would be willing to give annually ; or, in other 
 words, a tenant pays rates and taxes in addition to the " gross 
 estimated rental." 
 
 The '• rateable value " is " an estimate of the net annual 
 value of the several ' hereditaments, rated thereunto ' {i.e. 
 relief to the poor) ; that is to say, of the rent at which the 
 same might reasonably be expected to let, from year to year, 
 free from all usual tenant's rates, and taxes, and tithe com- 
 mutation rent-charge, if any ; and deducting therefrom the 
 probable annual average cost of the repairs, insurance, and 
 other expenses, if any, necessary to maintain them in a state 
 to command such rent."t 
 
 In other words, if the average annual cost of repairs, in- 
 surance, etc., be deducted from the "gross estimated rental," the 
 remainder will be the "rateable value," or "'net annual value," 
 upon which the rates are to be levied. 
 
 Prom this it will be seen, that a yearly tenancy is taken as 
 the standard for estimating the rateable value of any hereditament. 
 
 An example will make the matter clear. Let it be supposed Example, 
 that a person is willing to pay £100 annually for a house. He 
 
 * 25 & 26 Yic, c 103, s. 15, Union Assessment Committee Act. 
 t 6 & 7 William IV., c. 93, s. 1, Parochial Assessment -^■'■'-
 
 IG LOCAL TAXATION. 
 
 finds that the rates and taxes amount to £20 per annum. He 
 therefore offers to pay the landlord £80 a year rent. This sum is 
 the "gross estimated rental." But the whole of it will not find 
 its way into the landlord's pocket, for in a yearly tenancy it is 
 customary for the landlord to pay for insurance, repairs, etc. The 
 charges for these, on such a house as we are supposing, would 
 average about £12 per annum. The "net annual value" to the 
 landlord is therefore £68, and this is the "rateable value" of the 
 house, on which sum the tenant would be rated. 
 
 It will at once be perceived that, although the principle, on 
 which the " gross estimated rental " and the " rateable value " 
 are to be determined, is clearly laid down here, yet in applying 
 this principle to practice, there is no guarantee for uniformity of 
 valuation. The valuations, upcm which the Poor-rates are 
 Inequalities charged, are made by assessment committees and overseers, 
 the^d&erent whilst the magistrates make another valuation upon which the 
 systems of County-rates are levied. These last are made on a uniform 
 system throughout each county ; though different counties fre- 
 quently differ in their systems. But with regard to Poor-rates, 
 each assessment committee may have its own system of determin- 
 ing what is a correct estimate of the gross rental ; and that being 
 settled, may also have its own system for determining what 
 deductions should be allowed, so as to arrive at the "rateable" 
 or " net annual value." The confusion hence arising causes 
 much injustice ; and the want of a uniform system of accurate 
 valuation gives rise to many inequaliti-^s and anomalies. It is not 
 easy to show the inequalities of the various valuations for the 
 "gross rental;" but in column (6) of Table lY. is given the dif- 
 ference per cent, between the "gross rental" and the ''rateable 
 value " in twenty-eight unions in England and Wales, this 
 difference being the sum allowed per cent, for the cost of in- 
 surance, repairs, and other expenses necessary to maintain the 
 property valued in a state to command the gross rental. These 
 deductions vary from 6|* per cent, for the Union of St. George's, 
 Hanover Square, to 35| per cent, for Grreat Yarmouth. Can 
 there be an instance of greater inequality than this ? In Man- 
 chester, the ratepayers are allowed to deduct 17 per cent, from 
 the gross rental: but in Salford, a town adjoining Manchester, 
 they may only deduct lOi per cent. At Great Yarmouth they 
 * See Column (6), Table IV.
 
 LOCAL TAXATION. 17 
 
 may deduct 35f per cent., whilst at Norwich, in the same county, 
 only 16| per cent, deduction is allowed. 
 
 The writer of an article in the JEdinburgli Review says* : — 
 
 " AYe believe that the people of this country have but little 
 reason to complain of the taxation levied by the State. It 
 is equally imposed, it is cheaply collected, it is honestly 
 spent. But of the enormous sums levied under the form of 
 rates and Local Taxation the very reverse must be said. 
 
 4& ***** * 
 
 This is really the oppressive and unjust portion of our public 
 burdens. It is assessed with excessive inequality and injustice 
 by parochial boards, subject to no general control, and deaf to 
 remonstrance ; it is collected by non-official persons, and it is 
 spent nobody knows how — at least in the metropolis, and 
 in many other towns of the empire." 
 
 Now that Table lY. is before us, it may be well to observe TnequaKties in 
 another great inequality which exists between the dijfferent xjnfJns ia the 
 Unions in the amounts paid in the pound for the actual relief of P^^'^Jf P^^'i 
 the poor. Thus a reference to column II will show that, whilst 
 the City of London and St. George's, Hanover Square, pay only 
 7c?. and 8fl?. in the pound respectively, Bethnal Green pays 
 Zs. lid., King's Lynn 4s. 4|c?., Great Yarmouth 4s. ^d. 
 
 Even with respect to the present system of Local Taxation, 
 what seems first to be required is a common basis of valuation 
 throughout the country. But equity would also insist upon 
 the income arising from personal property, trades, and professions 
 being made liable to this taxation ; and then the impost should 
 be equally distributed over the whole country, so that the wealthy, 
 as at the West end of London, should bear their share of the 
 poorer, as at the East end. 
 
 t Edinlurgh Eevieiv, January, 18C9.
 
 18 
 
 LOCAL TAXATION. 
 
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 CHAPTEE II. 
 
 The property which is at present siibiect to Local Taxation, may Property 
 , T . 1 1 .111 subject to 
 
 be divided into three branches : — Local 
 
 Taxation. 
 (I.) Land, including Tithe rent-charge. 
 
 (II.) Houses, including Shops, Factories, Warehouses, etc. 
 
 (III.) Eailways, Canals, Coal-mines, Quarries, Gas and 
 
 "Water- works. 
 
 (I.) The rates upon land are collected from the occupier, who Rates upon 
 
 is assessed upon the "net annual yalue," or "rateable value," of 
 
 his holding. Now, land is either rented and occupied by a 
 
 tenant, or the owner is himself the occupier. The law holds the 
 
 occupier responsible for the due payment of the rates, and in 
 
 default distrains his goods. 
 
 It is often asserted, that the whole of the rates are ultimately Incidence on 
 
 . T. "^ landlord and 
 
 paid by the owner, because an intending tenant will calculate tenant. 
 
 what are the outgoings in the form of rates, taxes, etc., before he 
 offers a rent to the landlord. It is said, therefore, that rates are 
 a deduction from rent, and that any redistribution, which would, 
 to a certain extent, relieve the property now chargeable, would 
 benefit the landlord only. In theory this is quite correct. Out- 
 goings are calculated upon the average of past years ; and, if the 
 rates were a fixed charge, it might justly be said that the landlord 
 pays them : but in practice there are various disturbing influences. 
 Experience shows, that rates are a steadily increasing tax. How 
 then would this affect a tenant holding a lease ? It must be seen 
 at once that the total increase of the rates, since he became the 
 occupier, has come out of his own pocket. The annual amount 
 levied for Poor-rates has increased during the past ten years 
 by nearly three millions. In 1858* the amount levied was 
 £8,188,880, in 1868 it was £11,054,513. Intending tenants 
 could not have taken this increase into consideration, when esti- 
 * Twenty-first Annual Eeport of Poor-Law Board. Appendix C, No. 29.
 
 20 
 
 LOCAL TAXATIOIf. 
 
 mating what rent they could afford to give. Sir George Coruewall 
 Lewis,* in his evidence before the Committee of the House of 
 Lords in 1850, gave, as his opinion, that 
 
 " Any sudden or unexpected increase of parochial expen- 
 diture would, until the contract was readjusted, fall entirely 
 upon the tenant." 
 
 The tenant gets no compensation for tliis increase ; and " a 
 very high authority" has informed Mr. Dudley Baxter, f 
 
 *' That there is such a competition for land and houses, 
 that, even where property is relet, the old rather than the 
 oiew rates are supposed to belong to the landlord, and all the 
 fresh outgoings to the tenant. Tou may fairly say that all 
 the increase of rates within the last twenty-five years has 
 fallen upon the occupier." 
 
 It is clear, then, that no inconsiderable amount of the present 
 Local Taxation falls on the tenant. 
 
 But it is said that, in case the rates were reduced by a redis- 
 tribution, the great competition for lands and houses would 
 influence intending tenants to offer a rent increased by just so 
 much as the Local Taxation was diminished, and so landlords would 
 ultimately gain the amount. This argument would apply to any 
 other cause which might make his farm more profitable to the 
 tenant, such as the opening of a railway in the neighbourhood, 
 thereby affording a better market for agricultural produce. In 
 this case would competition compel the tenant, at the expiration 
 of his lease, either to give the whole benefit of the increased 
 profit to his landlord, or to resign his farm tj another who would 
 be ready to do so ? Those who reply in the affirmative forget 
 that there is a competition amongst landlords for good tenants. 
 The system of rack-rents is not carried out fully in practice. 
 Earms are not always let to the highest bidder; but, when a 
 landlord has a good and improving ten;mt on his land, he is 
 desirous of retaining him, and therefore would be willing to allow 
 him a fair portion of the increased advantages. The rent would, 
 indeed, be increased: but landlord and tenant would each have a 
 
 * Lords' Committee on Parocliial Assessments, 18G0. Q. 32. 
 f "Taxation of the United Kingdom." Ch. xii., p. 61.
 
 LOCAL TAXATION. 21 
 
 share in the profits. And just so it is with regard to. the reduction 
 of local burdens. It is true, that, if in isolated cases the local 
 rates were reduced, competition would cause an intending 
 occupier to ofier as rent what he would before have paid in rent 
 and taxes together : but, if the rates were generally reduced 
 throughout the country, it does not follow that competition would 
 enable the owner to monopolize the whole benefit. This would 
 imply that there were as many good and desirable farmers out 
 of business, as, at the time of reduction, there were occupiers. 
 It is then for the mutual interest of owner and occupier that the 
 rates should be reduced. 
 
 Mr. Dudley Baxter is of opinion that the " average inci- 
 dence of rates is tJiree-fourths on the landlord and one- fourth 
 on the tenant.'''' '^^ 
 
 And this calculation has been adopted in the following pages : 
 but, as the rates are increasing every year, and it has been 
 shown that the increase falls on the tenant, it would appear 
 that the proportion of incidence on the tenant is also annually 
 increasing. 
 
 But if the landlord and tenant would be gainers by a more Incidence on 
 general arraugement of the Local Taxation, it stands to reason that J^^| J^om?n. 
 those who occupy and farm their own estates would be benefited 
 in a much greater degree, for they would reap the whole advan- 
 tage of any reduction. More particularly would this afi'ect the 
 yeomen and small freeholders, upon whom the present system 
 presses very heavily and unjustly. Suppose the case of a pea- Example, 
 sant, who has saved sufficient money to buy an acre of land, and 
 is desirous of building a cottage on his plot of ground. Having 
 laid out his money in the land, he borrows enough to build his 
 cottage. For this loan he would pay interest, and not only so, 
 but he would have to pay rates on the whole property, the rate- 
 able value of which would be taken upon both the original pur- 
 chase and the outlay in building, whilst only the former would 
 really belong to him. The lender, meanwhile, who has thus 
 invested his money, would eujoy the interest without paying a 
 single farthing towards the rates. 
 
 The case of the beneficed clergy also deserves attention. The I^cuience on 
 
 " . the beneficed 
 
 clergyman is rated m the same manner as other occupiers on his clergy. 
 
 * " Taxation of the United Kingdom." Ch. xii., p. 62.
 
 22 LOCAL TAXATION". 
 
 glebe and glebe-liouse. He is also rated on the titlie rent-charge, 
 from which the greater part of his income is usually drawn ; and, 
 in addition to the heavy Local Taxation, he is expected to give 
 liberally to voluntary charities. 
 
 In the following extract from the letter of "An Essex 
 Eector,"* the position of the beneficed clergy is forcibly de- 
 scribed : — 
 
 " The clerical possessor of tithe rent-charge is not in the 
 same position as the landlord of the soil In almost all cases 
 the clergyman, by his death, ceases to have any interest in the 
 rent- charge. He cannot take it with him ; he cannot will 
 it away ; a stranger succeeds him in the enjoyment of it, as 
 unknown to him as his predecessor was ; and therefore 
 the living is not to him a property in the same sense that 
 a landed estate is to a family with a succession of heirs, 
 and therefore a living ought not to be rated as land. 
 
 " Again, while it must be allowed that, since the passing of 
 the Tithe Commutation Act, no incumbent obtains his real 
 tenth of the income of a parish ; and worse still, no matter 
 how the property improves and the population increases — 
 and, consequently, the clergyman's work — his income does 
 not increase in correspondence ; yet there are so many rates 
 and taxes, never dreamt of at the time of the passing 
 of the Commutation Act, now included in that monstrous 
 charge called the Poor-rate, that the clergyman most impro- 
 perly, if not unlawfully, is made to pay more than is right, 
 and has no possibility of obtaining redress, so as to have 
 equal taxation with his neighbours." 
 
 Effect of Local Having considered the incidence of the local burdens upon 
 I^uSural^^^ the various classes of landholders, it will be instructive to observe 
 interest. ^hat is the effect of this taxation upon the agricultural interest. 
 
 ISTo one will assert that the productive resources of land in Eng- 
 land and Wales are now made the most of. There can be no 
 doubt that a larger supply both of corn and meat might be 
 obtained from the same area. There are thousands of acres, now 
 lying almost useless, which would ultimately pay well for being 
 Example. drained and brought under cultivation. Let it be supposed that 
 
 * Letter from ''An Essex Eector."— "Times," Feb. 10, 186D.
 
 LOCAL TAXATION. 23 
 
 there is a tract of land of this description, which would onlj'- just 
 pay a fair remuneration for being cultivated, even if no rent were 
 paid for it. The owner would be willing to give an active and 
 enterprising tenant a lease of it at a nominal rent, on condition 
 that he improved it. It would be necessary for the tenant to 
 lay out capital. He would have to employ labour which was 
 previously unemployed. This would tend to raise the rate of 
 wages in that district, thereby lessening the call upon the Poor- 
 rates. As the land improved, there would be a greater supply of 
 food produced at home, thus obviating the necessity of importing 
 so much from foreign lands. This w^ould have the effect of cheap- 
 ening agricultural produce, and the community at large would be 
 benefited. But assessment committees have the power of 
 increasing the rateable value of a farm, as the occupier invests 
 his personal property in it. As soon, then, as it is perceived 
 that the barren land is improving, the assessment committee 
 will at once come down on the tenant ; and, supposing he had 
 invested £1000 of capital, he would probably be charged £16 
 or £17 for rates. It^ has been assumed above that the 
 tenant would only just be remunerated for cultivating this land, 
 if he held it at a nominal rent. The consequence is he will 
 be losing £16 or £17 per annum on the £1000 he has invested. 
 No one can be expected to be satisfied with this result, or to per- 
 severe in an unremunerative undertaking. 
 
 The present system of Local Taxation is therefore a direct dis- Local Taxation 
 
 . ^.,, ., .a discourage- 
 
 couragement to the investment oi capital m agriculture; tor it ment to the in- 
 involves a heavy tax on outlays in improvements. It is calcu- c^^iJ^i^j^ 
 lated to diminish the demand for labour, and so to lower the rate agriculture, 
 of wages. Ifc tends to cripple the productive power of the 
 country, to necessitate the importation of food, which might be 
 produced at home, and therefore to raise its price.* 
 
 * Since the above was -written, a letter from Norwich, under the signatui-e 
 "F. S. C," has appeared in the "Chamber of Agricultui'e Journal." An ex- 
 tract is here given, in which the writer fully corroborates the argument given 
 above : — 
 
 " Five years since, a farm in this neighboui'hood was let to a tenant under the 
 foUo-wing conditions, namely, that for the first four years he should pay no rent ; 
 for the ten years next ensuing his rent was set at a sum approximately that of 
 the adjoining farms in an average state. The condition of the farm at entry fully 
 justified this. 
 
 " In the first four years the tenant's outlay upon improvements amounted to
 
 24 LOCAL TAXATION. 
 
 The Englisli farmer has to contend against great competition 
 from foreign countries, where the climate is more favourable, and 
 where land and labour are niuch cheaper than at home ; and it 
 requires the greatest exertion to compete successfully. Agricul- 
 ture used formerly to be encouraged by the imposition of heavy 
 duties on the importation of foreign agricultural produce. 
 "Whilst this system of protection existed, by which agriculturists 
 gained special benefits, it was only fair to others that they 
 should bear special taxation ; but now that protection has been 
 abolished by the adoption of free trade, wealth, as derived from 
 other sources than real property, has increased to a marvellous 
 extent; and it is no longer just that those sources should remain 
 exempt from Local Taxation. 
 
 In February, 1S51, Mr. ."Disraeli stated that " owners and 
 
 occupiers were more heavily weighted with taxation tlian any 
 
 about £3000. Now, let us mark wliat took place in the assessment of such a 
 place. Dming the first four years, when, as I have said, the tenant paid no rent 
 (with a view to prospective improvements), the assessment was made (properlyj 
 as I think) upon an assumed annual value, proportionate to its existing state 
 during the twelve months next accruing ; and this without reference to any state- 
 ment made of the actual rent. The principle (otherwise applicable) of a valua- 
 tion in communibus assessis was deemed inapplicable in this case. 
 
 "At the end of the fourth year (the valuation not having been changed), an 
 appeal upon the part of the parish took place ; and, by order of the assessment 
 committee, a regular survey was made. At that time, by the judicious outlay of 
 a considerable capital, the farm had reached a pitch of culture considerably 
 beyond that of most in the same parish, and upon the report of the valuers the 
 assessment was considerably increased. Kevertheless, so unfair did it seem, to 
 the committee that such should be the incidence of the tax, that a special refe- 
 rence was taken upon one point, namely, whether, under the whole cii-cumstances 
 detailed, any abatement should be made to replace capital laid out. The fiat 
 was against this. 
 
 " Surely it is idle to ask upon whom is the incidence of this tax — his landlord 
 or himself. 
 
 " Nor can I leave such an instance without a further remark, addressed to 
 those who (Kke myself) have the welfare of the agricultural labourer as well as 
 the farmer at heart. 
 
 " Amongst them there are economists as well as philanthropic gentlemen, 
 and the former, at all events, will comprehend this fact — that it is, and must be, 
 the application of capital which determines the labourer's state. Without an 
 increase of capital, no increase of wages can take place. 
 
 " One question let me ask. Does capital seek out an industry thus heavily 
 taxed ? Invested in manufacture, would this man's £3000 have been liable to 
 such a burden as this ? Would the per-centage derived have been less ?"— 
 " Chamber of Agriculture Jom-nal," Oct. 18th, 1869, p. 723.
 
 LOCAL TAXATIO^'. 25 
 
 other class, because taxation had been adjusted to their 
 shoulders during the existence of an artificial system which 
 insured them a good market for their productions, but which 
 system was now removed ; and he protested against flinging 
 upon the land a disproportionate share of burdens, which, 
 as they were raised for the behoof of the general public, 
 ought to be equally and impartially distributed over the 
 whole general public." 
 
 Both Sir Eobert Peel and Earl (then Lord John) Russell 
 pledged themselves that, when the policy of free trade should be 
 adopted, it would be only just and right that it should be accom- 
 panied by a policy of fair taxation. This measure of justice and 
 equity has never been carried out, and commerce and manu- 
 factures, by their exemption from Local Taxation, are, in fact, pro- 
 tected at the expense of agriculture. One result of this system 
 may be seen in the annually diminishing number of small farms 
 cultivated by their owners. The yeomanry of England bore a 
 very important part in the early history of the country, but now, 
 owing partly to the extensive use of machinery in agriculture, 
 which a small farmer cannot afford, and partly to the great 
 increase of burdens on land, the yeoman, being unable to earn 
 reasonable profits, finds it advantageous to himself to sell his 
 estate to some large proprietor in the neighbourhood, and invest 
 the proceeds in a more lucrative business. Thus it happens that 
 the small freehold farms are being continually absorbed. This 
 fact is well worth the attention of those who advocate the system 
 of peasant proprietors. 
 
 But it is often urged that the profits of a farmer are much The profits of 
 
 greater than those of a fundholder, and, therefore, he ought to pared^Sith*^"^ 
 
 bear a larger amount of taxation. The profits of a farm should ^^^^^ °? °^^^'" 
 " . ■■- occupations. 
 
 be such as to answer at least the following reasonable demands. 
 
 1st. The interest at the ordinary rate on the capital invested 
 in the farm. 
 
 2nd. The sum due as wages to the farmer for supervision ; for if 
 he were not the overseer of his own farm, he would have to 
 pay a bailiff to superintend it for him. The farmer would 
 probably do twice the work of a man who was hired. 
 
 3rd. The insurance against risk to live and dead stock.
 
 26 
 
 LOCAL taxatio:n^. 
 
 Kates upon 
 laouses, etc. 
 
 If these last two items be deducted from a farmer's profits, it 
 is very doubtful whether the remaining item, viz., the rate of 
 interest on his invested capital, exceeds that which a fundholder 
 receives for his investments, about which he has no risk and no 
 trouble of superintendence. But, however this may be, it is cer- 
 tain that farming is not nearly so lucrative as many retail 
 trades. 
 
 (II.) The greater part of rates upon houses, shops, factories, 
 etc., falls upon the inhabitants of cities and towns, and, as in the 
 case of land, are collected from the occupier on the " rateable 
 value " of the house, except in the instances hereafter noted at 
 page 27, inf. Eut the rent paid for houses diifers in some points 
 from that paid for land. The element of productiveness does not 
 enter into the calculation of a tenant when he is determining 
 what rent he will offer for a house. With regard to land this is 
 one of the principal considerations. Again, if the house be one 
 of a limited number, situated in the heart of a good neighbour- 
 hood, the competition for it will be so great, that the owner can 
 demand almost what rent he pleases, without allowing any draw- 
 back for rates. In this case the occupier would pay the whole 
 of the Local Taxation : but where there are a considerable number 
 of houses, from which an intending occupier may choose, as in the 
 suburbs of a town, he calculates the amount of the rates, and 
 offers so much less rent : but, after he has made this agreement, 
 any increase of local burdens will fall on him as it does on the 
 tenant of land ; and from dislike of changing his abode, or because 
 he has become attached to the house, he will continue to pay these 
 increased rates when he has to renew his lease. 
 
 Mr. Dudley Baxter * considers " that on the average of 
 house property, the incidence of rates, may be estimated 
 at two-thirds on tlie landlord, and one-third on the tenant^ 
 w^here the rates are paid by the tenant ; but that the land- 
 lord pays a larger proportion when they are compounded 
 for by him. 
 
 '' But in order to avoid any under-estimate of the pressure 
 of taxation on the tenant," Mr. Dudley Baxter takes ''the rates 
 on houses as paid lialfhy the landlord and halfhij the tenant.'" 
 
 * " Taxation of the Uuited Kingdom." Ch. xii. p. m.
 
 LOCAL TAXATION. ,27 
 
 This calculation has been adopted in the following pages, and 
 it is probably the more correct estimate of the two. 
 
 By the Poor Eate Assessment and Collection Act, 18G9,* 
 occupiers of tenements let for short terras, not exceeding three 
 months, may deduct the Poor-rate paid by them from their rents, 
 and no such occupier can be compelled to pay at one time, or 
 within four weeks, a greater amount of the rate than would be 
 due for one quarter of a year. The object of this is to ensure 
 that the occupier shall not be required to pay, as Poor-rate, a sum 
 which he cannot within a short period recoup himself by deduc- 
 tion from his rent. Here then the owner would pay the whole 
 of the rates. AVhere the rateable value of any hereditament does 
 not exceed twenty pounds, if situate in the Metropolis ; or thirteen 
 pounds if situate in any parish wholly or partly within the borough 
 of Liverpool ; or ten pounds if situate in any parish wholly or 1 
 
 partly within the city of Manchester or the borough of Birming- I 
 
 ham ; or eight pounds if situate elsewhere, the owner may agree 
 to pay the rate and be allowed a commission not exceeding 
 twenty-five per cent, on the amount thereof. Here the owner 
 will pay the greater part of the rates. It is also to be noted, 
 that to entitle him to the commission he must pay whether tlie 
 hereditament be occupied or not. 
 
 Business premises, factories, mills, etc., are frequently the Incidence on 1 
 property of the occupier; but their rateable value must be deter- and occupiers I 
 
 mined, as in other cases by considerinsr what would be their " net °^ business [ 
 ... premises, \ 
 
 annual value." This it is often very difiicult to do, as probably factories, etc. 
 
 there will be no similar premises near, and it will be impossible 
 
 therefore to institute a comparison by which to measure the 
 
 value. In all these the occupier maybe making thousands a year I 
 
 profit, but he is only rated on the premises in which he dwells, 
 
 and in which he carries on his business. The artisan employed 
 
 at a factory would, according to Mr. Baxter's theory, pay about 
 
 halff the amount levied on his dwelling, and there can be no 
 
 doubt that, even though he may only have to pay 16^. 8d.X per 
 
 annum, this is a very great hardship to a man who is earning only 
 
 from £50 to £60 per annum, — a very much greater hardship than 
 
 paying £100 per annum is to his employer, who is perhaps clearing 
 
 *- 32 and 33 Vict., c. 41, s. 1—3. See Edition of the Act by H. Owen, Esq. 
 t See p. 26, supra. % See Table V., p. 33, infra.
 
 28 LOCAL TAXA.TION. 
 
 £5000 per annum. Mr. Eathbone, the Member for Liverpool, 
 speaking in the House of Commons on the 22nd of June last, is 
 reported to have said— 
 
 " The principal wealth of our large towns consisted of 
 commercial, manufacturing, and trading interests ; but, ex- 
 cept incidentally, none of these interests contributed to the 
 Poor-rate, and the more their wealth had increased the more 
 they had escaped from anything like a legitimate amount of 
 contribution to the support of the poor. They did not pay 
 on their capital, because that capital, consisting mainly of 
 personalty, was not subject to Local Taxation. Nor did they 
 contribute in the towns on their domestic establishments, 
 because now, the merchant, the banker, or the broker, instead 
 of living on the spot where his business was conducted, re- 
 sided out of town. Tho fact that men of the class to which 
 he referred paid so insignificant an amount towards the relief 
 of the poor had, he was convinced, a good deal to do with 
 tlieir withdrawal from a discharge of the duties of Poor Law 
 guardian. A merchant, doing a large business in a mode- 
 rately large office and warehouse, only paid rates for those 
 premises, whatever might be the extent of his transactions. 
 Merchants, who had made the calculation, informed him that 
 the proportion of their income derived from trade on which 
 tliey paid Poor-rate amounted to only from one-half to two 
 yer cent., while the proportion of their income on which 
 labourers, in the employment of those merchants, paid Poor- 
 rates was 3f per cent. From this it appeared that the pro- 
 portion, in which persons paid in large towns, was in almost 
 inverse ratio to their wealth. Upon the class of small trades- 
 men the Poor-rate operated most oppressively, and with 
 especial severity upon those who were in the humblest cir- 
 cumstances. It might be said that it was foolish for the 
 mercantile community to be active in promoting a change of 
 system ; but tlie mercantile community were not foolish or 
 shortsighted enough to believe that a system could be good, 
 which transferred a considerable portion of the burden of 
 taxation from their shoulders to those of the very poor." 
 
 In levying Income-tax for imperial purposes, incomes under
 
 LOCAL TAXATION. 29 
 
 £100 per annum are exempted, and incomes between £100 and 
 £200 per annum are allowed to deduct £t30 before paving the 
 tax ; but the occupier of the smallest holding must pay local 
 rates, and cases have been known of people coming upon the 
 Poor-rates for relief who were actuall}' at the time in debt to the 
 overseers for arrears of rates, with which they bad been charged, 
 but which they had not been able to pay. It is not fair that 
 those whose incomes but just remove them above the level of 
 poverty, should be charged with the payment of rates for the 
 relief of the poor. 
 
 The high rates levied upon houses tend to discourage the Effect of Local 
 building and improvement of the smaller kind of dwellings, par- tife dweUkigs 
 ticularly those inhabited bv the working classes. Capitalists will oi the 
 
 ,,, .*,.,,. ~' . . working 
 
 not lay out their money m building cottages, when they cannot classes. 
 
 get as good interest as may be obtained from other investments, 
 
 in consequence of these local taxes. There is, therefore, a less 
 
 demand for the labour, both skilled and unskilled, of those who 
 
 would be employed in house-building ; and worse than this, there 
 
 is not sufficient decent accommodation provided either in towns i 
 
 or villages for the working population. Dwellings are over- I 
 
 crowded, whole families frequently living together in one room. 
 
 Moreover, the population of towns is rapidly increasing. At the 
 
 census of 1S61, it was found that there were nearly 11 millions 
 
 residing in 781 towns, and little more than 9 millions in the 
 
 villages and country districts ; that is, 55 per cent, reside in 
 
 towns, and 45 per cent, in other parts of England and Wales. 
 
 It has been computed that, at the close of the present century, 
 
 at least 64 per cent., or nearly two-thirds of the whole population 
 
 will be found in towns. If there is not room enough at present, 
 
 what can be expected with an increase of town population, but 
 
 an increase of disease and vice, and the miserable demoralization 
 
 of all who are brought up under such influences. " S. Gr. 0.,"* 
 
 writing to the " Times," goes straight to the point when he 
 
 ascribes the great increase of pauperism and crime to the want 
 
 of decent habitations for the labouring classes. He gives a vivid 
 
 picture of the homes in which poverty and crime^go hand in 
 
 hand. 
 
 " When to the idea of the man we try to attach the idea 
 ♦ Letter from " S. G. 0."— "Times," Jan. 25, 1869.
 
 30 LOCAL TAXATION. 
 
 of his home, we at once domicile him in some wretched, 
 narrow, ill-drained, filthy locality, where, not himself ' the 
 compound householder,' he is yet with his wife, or the woman, 
 so called, a portion of a compound household, consisting of 
 as many of the same class, or worse than himself, as the 
 dirty rooms, attics, cellars, can contain ; men, women, and 
 children are there, all breathing a foul atmosphere, fed on 
 coarse and often most foul food ; stale fish, washed down 
 with adulterated spirits, a very common diet. As to decency, 
 it is not merely non-existent, but all around would stifie in 
 the birth any attempt at it. B,eligion ! why, blasphemy is 
 there, not the outbreak of auger into impious language ; it 
 is in such places one of the chief elements of language which 
 go to make up ordinary intercourse. How in such a scene 
 can any one teach children to love God and reverence the 
 law ? There have been, doubtless, many glorious instances 
 where imported adult piety, compelled to dwell thus, has yet 
 survived ; but how is it possible to conceive that the native 
 —the bred and born there — can have one wholesome idea as 
 to soul or body ? In so rank a soil, in such an atmosphere, 
 could industry, honesty, chastity, sobriety survive ? Its 
 trading community are in character with the general popu- 
 lation ; all that is sold is of the worst, all that is bought is 
 at its last — where it is not the fruit of robberv. 
 
 *' Is it not the case, that all the while we are deploring 
 the increase of paupers, and execrating the increasing breed 
 of daring criminals, we do keep up immense breeding areas, 
 stocked to the overfi.ow with men, women, and children, who, 
 compared witli all otber life, are bred to a vermin life ? We 
 cry out for more Poor-law officials, more stringent dealing 
 with paupers. "We clamour for more activity in the police, 
 and police power, to catch the robber when he leaves the 
 locality, where there is nothing worth stealing, for the watch 
 and plate regions, and yet we either cannot, or will not, go 
 to the root of the evil, and try to diminish this dangerous 
 breed of beings by letting the light of ordinary civihzation 
 into their scene of dwellinfj.
 
 LOCAL TAXATION. ^ 
 
 " We spend in a few years a few million pounds on 
 public buildings and 'embankments,' on all manner of con- 
 struction, which may, while it proves our enterprise, tend to 
 exalt the outward character of the Metropolis ; a drive after 
 dark along our great shop thoroughfares affords a wonder- 
 fully illuminated spectacle of all that art can effect to fashion 
 every valuable material of this earth into articles of use or 
 luxe : a wonderful picture it all is of the demands of civiliza- 
 tion, in aid of all its invented necessities. And yet, beneath 
 all this, often very close to it — certainly, ever within a mile 
 or two of it — are hundreds of thousands of human beings, 
 lining the life of utter decivilization ; nay, worse than this, 
 the progress of other class improvement, the claims of 
 wealth, have so occupied the ground, that year by year the 
 dwelling space for all labouring men becomes further con- 
 tracted ; and those who are industrious hate pauperism — 
 who are honest, and would rear their children so, can onlv 
 find their dwellings as they may, at any cost to body and 
 soul, in these nurseries of guilt. 
 
 " The Church has tried churches and chapels. Dissent 
 has put forth all its missionary energy ; philanthropy has 
 
 worked with a will and a zeal above all praise 
 
 Our great gaol and house of correction, penitentiary, and 
 reformatory institutions, are already on a large scale, and 
 yet there is ever a cry for more space for the treatment of 
 criminals, for the rescue of penitents. To my mind, so long 
 as we shunt the dicellincj question, all this religious, and 
 charitable, and legal apparatus, is only so much mill power 
 to grind the grist of the crop we see growing — know must 
 so grow, so long as we submit the labouring classes to a 'pres- 
 sure in tlie matter of liome — which must drive them^ to such a 
 home, that, hred without decency^ they must groio up without 
 shame. 
 
 "It is my firm conviction that the condition of the 
 classes who, as paupers and criminals, now excite so much 
 anxiety, has yet to be made known in all the depth and 
 breadth of its real danger to the nation — that there are 
 beneath all the outward show of wealth increasing, luxury 
 advancing, elements of danger to our whole social common- 
 wealth, and that these are the result of our own wilful
 
 32 
 
 LOCAL TAXATION. 
 
 blindness to the causes which have begotten them. The 
 real truth is, as yet we have been content to deal only with 
 the effect of the degradation of our poor, doing this on no 
 one well-considered principle. The true causes of that 
 degradation have formed themes for much writing and decla- 
 mation, but the ruling powers of the nation have hitherto 
 avoided any effectual dealing with them." 
 
 IThe ability 
 to contribute 
 to be measured 
 by income. 
 
 Eates upon 
 railways, etc. 
 
 Incidence on 
 railway share- 
 holders. 
 
 The average rate in the pound of Local Taxation for England 
 and Wales is shown in Table III.* to be 35. M. approximately 
 (Ss. 3'9^.) ; and the ratio of the incidence has been found to 
 be 4a'. 2d. on towns, to 2^. 6d. on the rural districts ; the 
 difference being principally due to rates in towns levied under the 
 Public Health and Local Government Acts, and for Drainage, 
 Sewerage, and Lighting, all of which are purely local objects; 
 and therefore all inhabitants of towns ought to contribute ac- 
 cording to their ability, as all reap the benefit. 
 
 Now the ability of any one to contribute is best measured by 
 his income. The opposite table gives the rate in the pound of Local 
 Taxation on the incomes of various occupations of the community : 
 and shows clearly the unequal incidence of Local Taxation in 
 towns as well as rural districts ; and that it is to the interest of 
 dwellers in both to strive for a reform. 
 
 Observe here that although the manufacturers' income is 
 equal to the landed proprietor's, the former pays but one-fourth 
 the amount of Local Taxation imposed on the latter. And so, 
 whilst the tradesman's income is double that of the yeoman, the 
 former pays little more than a third of the rate paid by the 
 latter. 
 
 (III.) Eailway property is of three kinds, viz. : — 
 Debenture bonds and stock. 
 Preference shares and stock. 
 Ordinary shares and stock. 
 
 The debenture bonds and preference shares are not charged 
 to the rates, so that the whole of rates on railways are paid by 
 the ordinary shareholders. This has the effect of raising the 
 cost of traffic both of persons and of things. It is, in fact, an 
 indirect tax on locomotion. It is found that 62 per cent, of those 
 who travel by railways are third-class passengers. These, then, 
 * See page 14, supra.
 
 LOCAL TAXATIOif. 
 
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 34 LOCAL TAXATION. 
 
 who can least afford it most feel the pressure of rates on rail- 
 ways, for if the rates were diminished, as they might be by a 
 redistribution, they would travel just so much the cheaper. In 
 
 Canals. many of the canal acts there is a special clause stating in what 
 
 manner the particular canal is to be rated ; but the incidence of 
 the rates is very much the same as in the case of railways. The 
 rates are charged upon the shareholders, and the general public 
 suffer. They are an indirect tax upon traffic. 
 
 Coal mines and With regard to coal mines and quarries,* " the produce, for the 
 right to enjoy which the rent is paid, is derived from the sale of 
 the corpus J and not merely the use of it." CoaLmines are 
 usually worked by companies, and the proprietor generally 
 receives a stipulated portion of the gross returns as a considera- 
 tion for the use and deterioration of his property. In agreeing 
 what this portion or royalty shall be, the company of course take 
 into consideration the rates they will have to pay ; and any 
 increase of the rates will fall upon them. The incidence of the 
 rates may therefore be considered the same as in the case of 
 land, partly on the occupiers or company who work the mine, 
 and partly on the proprietor. There is no doubt also that 
 the price of the coal and stone excavated is in some degree 
 affected by the rates, so that here also the community would 
 share the benefit if the rates were diminished by a re-arrange- 
 ment. 
 Gas and In the case of gas and waterworks the whole of the rates 
 
 ultimately fall upon the consumer. As the rates increase the 
 occupiers or proprietors of the works will increase the price of 
 the gas or water. 
 
 * Penfold on Eating, p. 59 (5fcli Ed.). 
 
 waterworks.
 
 CHAPTER III. 
 The gross rental of the property on which the Local Taxation Tlie i 
 
 in com 
 
 for England and Wales was raised in the year 1868 is estimated LTcTTalv-iticm 
 at £118,334,081* and the rateable value at £100,612,734. coiuparc'dwiHi 
 
 . •PI 1 1 • 1 "-''^ income of 
 
 This property is for the most part the same as that which was the country 
 assessed to Income-tax for Imperial purposes under Schedule A .generally, 
 before the 5th of April, 1886. At thatf date railways, 
 canals, etc.j were transferred to Schedule D. Their annual 
 value for 1868 is estimated by Mr. Purdy at £29,041,932,+ but 
 Mr. Purdy has included a sum of £1,526,790, dividends on 
 foreign securities, which, not being chargeable to the local 
 rates, must be deducted, leaving £27,515,142. 
 
 The latest return§ assigning the amounts of income 
 charged to Income-tax under each Schedule is for the year 
 1867. Mr. Purdy gives the amount of income charged under 
 Schedule A alone, for the year 1868 ; but, in order to make 
 an impartial investigation of the incidence of the taxation, it 
 will be necessary to know the amounts under the other Sche- 
 dules. In the following calculations, therefore, the Income-tax 
 returns for 1867 are taken. 
 
 The net annual value of real property, on which the Income- 
 tax was collected, may be put thus : — 
 
 £ 
 
 Under Schedule A 100,5-16,389 
 
 Sum formerly charged under A, ^ 
 
 but since 1865 transferred to ! 27,515,142 
 D, as profits ' 
 
 Total £128,061,531 
 
 * See Table III., p. 14, supra. t 29 Vict., c. 36. 
 
 X Journal of tlie Statistical Society, Yol. xxxii., pt. 3, pp. 309 and 324. 
 § Twelftli Eeport of Commissioners of Inland Revenue. App., p. siii.
 
 36 LOCAL TAXATIOJ^^. 
 
 The difference between this total and the rateable value of 
 property assessed to Local Taxation is £27,448,797. This differ- 
 ence must not be attributed wholly to defective valuation on the 
 part of assessment committees and overseers, because some real 
 property under Schedule A, and some of that transferred tQ 
 Schedule T>, is exempt from local rates. 
 
 jN'ow the total income of England and Wales, upon which 
 the Income-tax was raised for the year 1867, amounted to 
 £302,294,505,* and since the local rates are levied on 
 £100,612,734 of income, it appears that the whole of the Local 
 Taxation of the country is paid by less than one-third of the 
 income which is chargeable to Income-tax for Imperial purposes. 
 But the income shown under the Income-tax returns by no means 
 represents the actual income. It is Avell-known that income-s 
 under £100 per annum are not included in these returns. 
 Incomes between £100 and £200 per annum are excused the tax 
 on £60. Again, there are unreturned profits of trades and pro- 
 fessions under Schedule D. Mr. Dudley Baxter puts the income- 
 of the manual labour classes at £254,729,000.t Table VI. gives 
 the aggregate income of all classes in England and Wales 
 approximately for the year 1867. 
 
 TABLE YI. 
 
 Approximate Income of all Classes in England and Wales, 1867 
 
 Mr. Dudley (^^) Income-taxf charged in 1867 on £302,294,505 
 
 "NiTioual lu The £60 per annum excused to incomes 
 
 come,'' p. 3i. between £100 and £200 per annum+... 10,000,000 
 Incomes under £100 per annum, not 
 charged to Income-tax and not derived 
 
 from manual labour 60,000,000 
 
 (h) Unreturned profits under Schedule D ... 49,075,712 
 
 Income of Upper and Middle Classes . . . 421,370,217 
 
 Earnings of manual labour§ 254,729,000 
 
 Total £676,099,217 
 
 ^' See Table VI. t " ISI^atioual Income," p. 5. 
 
 t Twelfth Report Inland Revenue Commissioners, App. xiii. 
 § " National Income," p. 52.
 
 LOCAL TAXATION". 37 
 
 Note (a). — This amount differs from that given in tlie 12th 
 Report of H.M.'s Commissioners of Inland Revenue, which is 
 £316,676,079. The difference is accounted for hj the fact that 
 under Schedule B the rent paid by farmers is given as 
 £28,763,148 ; but a farmer's profits chargeable with Income- 
 tax are supposed to be half his rent. Hence the income of 
 those assessed under Schedule B is £14,381,529. 
 
 (b). — The unreturned profits, or sum on which Income-tax 
 was evaded under Schedule D, is estimated by H.M.'s Com- 
 missioners of Inland Revenue at £57,254,997,* the estimate 
 being made for the United Kingdom. Xow the income of 
 England and Wales, assessed under Schedule D, is f six times 
 the income of Scotland and Ireland together, under the same 
 Schedule. Hence the unreturned profits may be taken as 
 £49,075,712 for England and Wales. 
 8,179,285 for Scotland and Ireland. 
 which is probably an under estimate for England and Wales. 
 
 This vast amount of fraud will be discussed hereafter,^ 
 when the consideration of the statistical part of the subject is 
 ended. 
 
 The income, therefore, of all classes in England and Wales 
 being £676,099,000 approximately, it appears that that which is 
 subject to Local Taxation is considerably less than one-sixth — 
 indeed, very little more than ons-seve?itJi — of the whole income of 
 the country. This is a very great anomaly ; and a redistribution 
 of the burden would seem to be urgently required by justice and 
 equity, unless it can be shown that the property which bears it 
 enjoys privileges which are denied to other kinds of property, or 
 that other property is subject to taxation for objects from the 
 support of which real property is exempt, and which might be 
 placed as a set-off against the Local Taxation. 
 
 In order, then, to form an impartial judgment on this matter. The system of 
 it will be necessary to consider the system of taxation for Ippenal Taxa- 
 
 . *' , , •' ^ ^ tion, in connec- 
 
 Imperial purposes in connection with the existing system of Local tion with the 
 Taxation, and to view the bearing of both upon the community T^atfon. °^^ 
 generally. We shall omit from our calculations, as not germane 
 to the subject, all such taxes as are ultimately paid indirectly by 
 
 * Twelfth Eeport, p. 23. f Twelfth Eeport, App., p. xiii. 
 
 X See page 44, infra.
 
 38 LOCAL TAXATIONS'. 
 
 the customer or consumer ; because tlie cost of them is added by 
 the merchant or vendor to the wholesale or retail price, merely 
 remarking here that the manual labour classes contribute their 
 share to this indirect taxation. These taxes are Excise duties, 
 taxes on patents, bills of exchange and bankers' notes, newspapers, 
 patent medicines, gold and silver plate, and duties on cards. The 
 assessed taxes, with the exception of house duty, are also omitted, 
 because they are voluntarily incurred by the taxpayer. 
 
 The Imperial Taxation of England and "Wales (with the above 
 exception) is given in Table YII. for the year 1868. 
 
 TABLE YII. 
 
 Imperial Taxation. — 18G8. 
 
 (a) Stamps on Deeds and other Instruments £1,405,000 
 Probates of Wills and Letters of Adminis- 
 tration, etc 1,382,000 
 
 Legacy and Succession Duties 2,145,000 
 
 (h) Receipts, Drafts, and other Id. Inland 
 
 Eevenue Stamps 500,000 
 
 Marine Insurances 156,000 
 
 Licences and Certificates 98,000 
 
 Probate Court Pee Stamps 121,000 
 
 Admiralty Court Do 11,000 
 
 Laud Eegistry Do 1,000 
 
 {h) Companies' Registration Pee Stamps ... 7,000 
 
 Common Law Court Pee Stamps 112,000 
 
 Land Tax 1,058,000 
 
 House Duty 1,003,000 
 
 Property and Income Tax 
 
 Real Property 2,354,000 
 
 Prom other Sources 2,845,000 
 
 5,199,000 
 
 Total £13,501,000 
 
 Thus we have — 
 
 Imperial Taxation 13,501,000 
 
 Local Taxation-^ 16,727,000 
 
 Total Taxation, with the exceptions ") ^oa ooq aaa 
 
 mentioned above '^ ' 
 
 * Table II., p. 13, stirpro^.
 
 LOCAL TAXATIOIf. 39 
 
 Note (a). The stamps on deeds, etc., are taken from Mr. 
 Purdy's paper in the " Journal of the Statistical Society," 
 Yol. ixxii., part iii., pa^e 311. 
 
 (b). The Inland Revenue Stamps and Companies' Registra- 
 tion Fee Stamps are given for the United Kingdom in the 12th 
 Report of Her Majesty's Commissioners of Inland Revenue, 
 appendix, p. v. The figures in Table YII. are an estimate for 
 England and Wales. 
 
 It may be observed here that none of this Imperial Taxation 
 is paid by the manual labour classes. The whole of it is borne 
 by the upper and middle classes, whose income is estimated at 
 £421,870,000 in Table YI. 
 
 Xow let us compare the amount of Imperial Taxation paid by 
 income from real property, with the amount paid by income from 
 other sources. 
 
 TABLE YIII. 
 
 Imperial Taxation in England and Wales faUxnrj on real pro- 
 Ijerty in 1867-6S, or thertalouU, according to returns in possession 
 of JSer Majesty's Commissioners of Inland Bevenue.^ 
 
 Propertv and Income Tax, 1867 2,354,000 
 
 Land Tax, 186S 1,058,000 
 
 House Dutv, ISaS 1,003,000 
 
 Succession "Duty, 1868 608,000 
 
 (a) Stamps on Heeds and other Instruments, 
 
 1868 1,405,000 
 
 ih) Probate of WiUs and Letters of Adminis- 
 tration 
 
 (c) Leo:acy Huty on Real Property, directed by 
 
 Will to be sold 
 
 (d) Probate Court Pees 
 
 (e) Land Registry Pees 
 
 Approximate Total £6,428,000 
 
 AWe (?0.— Stamps on sales, conveyances, leases, mortgages, 
 are included in this sum, but it is impossible to distinguish ac- 
 curately, what portion is incident on real property. 
 
 (6).— The stamp duties on Wills and Letters of Administra- 
 tion, some of which will be paid on leaseholds for years, andthere- 
 
 * Mr. Purely, Journal of tke Statistical Society, voL xxxii., pt-iii.jp. 331.
 
 40 LOCAL TAXATION. 
 
 fore indirectly from real property are excluded from the above 
 Table. 
 
 (c). — By tbe Succession Duty Act (16 & 17 Victoria, c. 51, 
 s. 29), real property directed by will to be sold is chargeable, 
 like personal property, with legacy duty ; except where, under 
 the said Act, it is chargeable with duty as a succession. This is 
 also excluded. 
 
 (d) and (e). — Probate Court Fees and Land Eegistry Fees 
 have been omitted. 
 
 It is more than probable that these exclusions (h), (c), {d), 
 (e), will balance the excess under the head of stamps on deeds (a). 
 
 To find the amount of Imperial Taxation borne by other than 
 real property, deduct the total in Table VIII. from the first total 
 in Table VIL thus:— 
 
 Total Imperial Taxation £13,501,000 
 
 Ditto ditto ditto borne by real property 6,428,000 
 
 Total Imperial Taxation borne by other than 
 
 real property £7,073,000 
 
 It has* before been estimated that three-fourths of the local 
 taxes are paid by the owner, and one-fourth by the occupier. 
 In the case of other real property, one-half is paid by the owner 
 and one-half by the occupier. And Mr. Purdy states that, in 
 1865, landed property, including tithe rent-charge, bore 35*3 per 
 cent, of the aggregate amount of local rates ; and real property 
 other than land bore 64*7 per cent. Now, dividing £16,727,000, 
 the total Local Taxation, in the ratio of 35*3 to 64*7, it follows 
 that the incidence is 
 
 £5,911,000 upon landed property, 
 and £10,816,000 upon real property other than land ; 
 
 but three-fourths of the tax upon land is paid by the owner, and 
 one-half of the tax upon real property other than land is paid 
 by the owner. Hence 
 
 £4,433,000 is paid by oivners of land, 
 and £5,408,000 is paid by oivners of real property other 
 
 ' ■ — than land. 
 
 Making £9,841,000, the total amount paid by the owners of 
 real property. 
 
 * See pages 21 and 26, supra.
 
 LOCAL TAXATIO^'^. 41 
 
 Also, £1,478,000 is paid hy occupiers of land, 
 and £5,408,000 is paid by occupiers of real property other 
 
 tlian land. 
 
 jNIaking £6,880,000, the total amount paid by the occupiers of 
 real property, both land and otherwise. 
 
 But part of the sum total of £5,408,000 paid by occupiers of 
 real property otlier than land will fall upon tlie manual labour 
 classes. Mr. Dudley Baxter gives* £2,000,000 as the amount 
 of rates paid by these classes in the United Kingdom upon an 
 income of £325,000,000 : but the iucome of the manual labour 
 classes in England and AYales isf £255,000,000, or thereabouts. 
 We may therefore estimate that £1,509,000 will approximately 
 be the amount of rates paid by these classes. Summarising the 
 above results, we have : — 
 
 £9,841,000, the amount of Local Taxation falling upon owners 
 of real property who are assessed under Sche- 
 dule A. 
 £1,478,000, the amount falling upon occupiers of land whose 
 profits are assessed to Income-tax under Sche- 
 dule B. 
 £3,839,000 will fall upon occupiers of real property otlier 
 than land whose incomes are assessed under 
 Schedules C, D, E. 
 and £1,569,000 will fall upon the manual labour classes, and 
 be paid out of their earnings. 
 In order to understand clearly the incidence of the aggregate 
 Imperial and Local Taxation, let us consider the community to 
 be divided into four classes : — 
 
 Class I. — Owners of real property, whose incomes cor- 
 respond to those assessed to Income-tax under 
 Schedule A. 
 
 Class II. — Occupiers of land, whose incomes correspond to 
 those assessed under Schedule B. 
 
 Class III. — Occupiers of real property other than land, 
 whose incomes are not derived from manual labour, 
 and correspond to those assessed under Schedules 
 C, D, E. 
 
 Class IY. — Manual labour classes, whose incomes are not 
 assessed to Income Tax. 
 In Table IX., the approximate incomes possessed by each of 
 these four classes is given ; the final total being the same as that 
 in Table VI. 
 
 * " Taxation of the United Kingdom," App. iv., p. 176. f P. 3G, su^m.
 
 42 
 
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 LOCAL TAXATION. 43 
 
 Bj means of the data at pages 40 and 41, and in Table IX., 
 we are now enabled to calculate at what rate per cent, the 
 incomes of these four classes of the community are charged — 
 
 (1) to Imperial Taxation ; 
 
 (2) to Local Taxation ; 
 
 and (3) to the Aggregate Ta:satlon of the country, by 
 adding (1) and (2) together. 
 
 It should be noted here that tbe Imperial Taxation is shared 
 by Class II. conjointly with Class III., the capital invested by 
 the occupier of land being subject to the same imposts as pro- 
 perty other than land. The per centage must, therefore, be the 
 same in each case, and must be calculated on the joint incomes of 
 Classes I. and II. — viz., a tax of £7,073,000 on an income of 
 £263,709,000. 
 
 The results of these calculations are given in Table X. A 
 comparison can then be instituted between the burdens borne by 
 each class. 
 
 TABLE X. 
 
 'Rates per cent, at ivhicli the Incomes of the four classes are charged 
 to Imperial, Local, and the Aggregate Taxation. 
 
 Class I. — Charged to Imperial Taxation at 4 per cent. 
 „ Local „ ;, 6-2 „ 
 
 „ Aggregate „ „ 10-2 „ 
 
 Class II. — Charged to Imperial Taxation at 2-7 per cent. 
 „ Local „ „ 8-3 „ 
 
 Aggregate „ „ 11 
 
 Class III. — Charged to Imperial Taxation at 27 per cent. 
 ,, Local „ „ I'o ,, 
 
 Aggregate „ „ 4*2 
 
 Class IY.— Charged to Imperial Taxation Nil. 
 
 „ Local „ at 'G per cent. 
 
 Aggregate „ „ '6
 
 44 LOCAL TAXA.TIOJS". 
 
 Here a great inequality of taxation becomes evident at a 
 glance ; and it must be remembered tbat the per centage in 
 Table X. is calculated on the total incomes of the four classes : 
 but Income-tax which is paid by Classes I., II., and III. is levied 
 upon an income of £302,295,000* only, whilst the aggregate 
 income of these three classes is £421,370,000. Hence the per- 
 centage actually paid is rather higher than that given in Table X. 
 It is necessary to calculate the per centage thus, because the 
 incomes which are exempt from Income-tax are not exempt 
 from other taxation. 
 
 Now, with the exceptions already mentioned of incomes 
 under £100 per annum, and the exemption allowed on £60 to all 
 incomes between £100 and £200 per annum, the Twelfth Eeport of 
 the Commissioners of Inland Eevenne declares, that " on lands and 
 liouses, on dividends and on salaries, and on pensions of public 
 officers, the (income) tax is levied nearly to the uttermost 
 farthing which is due" : that is, the incomes in Classes I. and [I., 
 and those in Class III., derived from dividends, salaries, and 
 pensions, contribute their fair quota to the Income-tax ; but the 
 remainder of the incomes of Class III. (corresponding to the 
 incomes assessed to Income-tax under Schedule D) evades the 
 Income-tax on about £49,076,000,t as has been calculated above ; 
 and it is to be noted that these are the incomes of professional, 
 mercantile, and trading com.munitieSc As Mr. Lowe describes it : — 
 
 *' Schedule D % depends on the conscience of the tax- 
 payer, who often, it is to be feared, returns hundreds instead 
 of thousands, and who is certain to decide any question, 
 that he can persuade himself to think doubtful, in his own 
 favour." 
 
 Mr. Lowe's fears are full}- justified by the experience of the In- 
 land E-evenue Commissioners. In one case, quoted in theEeport,§ 
 a person returned his income at £400 per annum, but, as soon as 
 he began to expect that his premises would be required by the 
 Metropolitan Board of Works, his return was increased to £1000. 
 In another case, *' on proceedings being taken, the defendants 
 attempted to justify themselves by stating that 'their returns 
 bore fully as large a proportion to their actual income as the 
 
 * Table VI. t Page 37, swpra. 
 
 X Draft Eeport to Income-tax Commissioners, 1861. 
 
 § Twelfth Report, pp. 19—24.
 
 LOCAL TAXATION. 4-3 
 
 returns made by their competitors and others in the trade,' and 
 that to have made true returns ' would have been in effect to 
 penalize themselves.' " This systematic fraud, moreover, is not 
 confined to any particular class, trade, or profession. The Com- 
 missioners found it prevailing amongst legal practitioners, public 
 companies, firms of world-wide reputation, and in every variety 
 of trade, and they estimate that in the United Kingdom the duty 
 is evaded on no less a sum than £57,254,997 ; and, " at the rate of 
 6d. in the pound, this would add to the revenue £1,431,374', 
 about the produce of a penny on the whole Income-tax." And 
 not only do the professional, mercantile, and trading communitien 
 evade the tax due to Her Majesty's revenue on this large sum, 
 but they, together with others whose incomes are included in 
 Class III., only contribute incidentally to the Local Taxation of 
 the country, from the fact that they are obliged to dwell in houses, 
 and carry on their business and trade in offices, factories, and 
 shops. They pay only at the rate of 1-5 per cent.* on their 
 incomes ; and this, compared with the G'2 and S'3 per cent, paid 
 by Classes I. and II., is almost an exemption. 
 
 In his financial statement in 1853, Mr. Gladstone remarked 
 that " The exemption of one man means the taxation of another ;" 
 and again, on the 25th of June, 1809, he said : — 
 
 '' Exemption is the imposition of taxes upon others. An 
 
 exemption is a concealed and latent grant, which men make 
 
 without knowing it, and which hides the real state of things 
 
 — the imposing of taxes upon others. It would be a most 
 
 important amendment to introduce into the whole law of 
 
 exemption from taxation, that there should be no such 
 
 thing, except as a public grant. "f 
 
 The owners of property, therefore, in Class III., have practically 
 
 a public grant at the expense of Classes I., II., and TV., a grant 
 
 which may be measured by the amount which they ought to 
 
 contribute as their fair proportion of the Local Taxation. And, 
 
 over and above this, the professional, mercantile, and trading 
 
 communities obtain, at the expense of the rest of the payers of 
 
 Income-tax, a grant of the immense sum by which they annually 
 
 defraud the revenue, whether altogether wilfully or not, does not 
 
 enter into the consideration of the matter in hand. 
 
 - Table X. 
 t Speech in tlio Debate ou " Sucday and Eigged Sclioola Hating'Exemption 
 Act," 1809.
 
 CHAPTER lY. 
 
 Kates are not It is often asserted that ratepayers have no real grievance to 
 olm^e. complain of, for that rates are no taxation at all, but a rent- 
 
 charge on real propert}^ reserved to the State; that they never 
 belonged to the purchaser, who, in consequence of their existence, 
 paid less purchase-money than he otherwise would have done. 
 JS^ow, in the year 1776 the total amount of Local Taxation was 
 £1,720,000, in 1868 it was £16,727,000, that is, in rather more 
 than 80 years this impost has increased nine-fold. Can it be 
 justly said that property was bought 80 years ago subject to the 
 present charge, as a rent reserved to the State, and that the 
 owner is not taxed ? Is it not the more reasonable view of the 
 matter that, as a purchaser acquires an estate subject to any 
 new taxes the State may see fit to impose, so also he may fairly 
 expect to have some of his old burdens removed from time to 
 time; and it is right for him to try to get these old burdens 
 removed or modified, when it is clear that they have become 
 unjust and unequal in their action. 
 
 Mr. Dudley Baxter reduces the theory that rates are a 
 reserved rent-cliarge to an arithmetical absurdity. The following 
 argument is taken from his book on the "Taxation of the 
 United Kingdom," the statistics for England and "Wales being 
 substituted for those given by Mr. Baxter.* It follows as a 
 logical consequence of this theory, that the owner, being really 
 not taxed by these rates, ought to be taxed again on his net 
 income. 
 
 We have seen that the fgross rental assessed to Local Taxa- 
 tion is £118,o34,000,t and that the local rates amount to 
 £16,727,000, and we have already shown that £9,841,000;]: comes 
 out of the pockets of owners of lands and houses. Then, if the 
 
 * " Taxation of the United Kingdom," pp. 51 — 55. 
 t Tables II, and III. 
 X Page 40, sujpra.
 
 LOCAL TAXATION. 47 
 
 theory under discussion is correct, the owners of this property, 
 worth a rental of 118 millions, are not taxed in one farthing of 
 the £9,84;1,000 by which their rents are diminished, but this 
 large amount is a rent-charge belonging to the State, and with 
 which they have nothing to do. It follows necessarily that, in 
 justice to the other tax-payers, the owners ought to be taxed 
 again to make up their full quota of taxation. Suppose, for the 
 sake of argument, that the deficiency below this quota is 7 per 
 cent, on £118,334,000 which would be £8,283,000, then this 
 additional sum ought at once to be imposed on owners and their 
 successors, and levied, as all taxes on property must, to be 
 effectual, "at the source," i.e., on the property itself. The 
 gross amount payable to the State will thus become £18,124,000, 
 in respect of £118,334,000 of rental. 
 
 But changes of property are continually occurring, both by 
 death and sales. Every heir would inherit subject to the 
 increased taxation, which would, therefore, on the reasoning of 
 the theory, constitute a rent-charge due to the State. Every 
 purchaser would deduct the whole outgoings from the price, and 
 take care to secure a net income at 3 per cent, on his purchase 
 money. Hence, after a certain lapse of time, when these changes 
 have become universal, the old state of things recurs. The 
 owners have bought or inherited, subject to the £18,124,000 
 rent-charge ; and by the theory must be held to be unaffected by 
 it. JNTot a penny of the £18,124,000, if the theory be correct, 
 can be held to be their taxation ; so that we must tax them again 
 in another 7 per cent, on the net rental, so making up a gross 
 assessment of £27,407,000 on the gross rental of £118,334,000. 
 
 But no sooner has this been done than the same causes begin 
 to operate, and the same circle to recur again and again, until it 
 is demonstrable by the strictest rules of logic — assuming the 
 theory to be correct, and giving time for sufficient changes of 
 property — that in the course of successive generations the owners 
 may pay £109,237,000 out of the £118,334,000 in local taxes, 
 and yet by the theory be perfectly untaxed, and require taxing 
 again on their £9,097,000 of net income. 
 
 Mr. Baxter goes on to point out that " the theory con- Fallacies in 
 tains three errors or fallacies which lead to this absurd ^"^ ®°^^* 
 conclusion. The first is a fallacy as to the principle of in-
 
 48 LOCAL TAXATION. 
 
 heritance. By the English laws, a man is allowed to hand 
 down his money or land to his children with as complete 
 proprietorship as he himself enjoyed it, so that the owner- 
 ship of the children is tlie same as that of the father, and 
 they cannot lose the reversion to the portion necessary to 
 pay the tax. It remains always a tax, continuing during 
 the will of the nation, and not a rent-charge which would be 
 ths perpetual property of the State. 
 
 " The second fallacy is the assumption that purchasers 
 always buy with deduction of the taxes, and so obtain a 
 clear income on their purchase-money. This is the object at 
 which they aim, but every purchaser knows how often he 
 fails in obtaining it. Eates have also a tendency to in- 
 crease, and to form a fresh burden on the property; and 
 fresh capital is invested at every change of ownership, 
 and during most ownerships, in improving the land and 
 buildings. 
 
 " The third fallacy consists in the forgetfulness of the 
 theorist, that purchase-money must come from somewhere, 
 and must itself have been subject to previous taxation. It 
 may have come from the sale of anotlier lauded estate or 
 houses, in which case it must have been realized at a loss, 
 which balances the deductions on the purchase. It may 
 have come from personal property ; in which case it was 
 subject to Income-tax and probate and legacy duty, and was 
 diminished accordingly. Or it may have been savings from 
 income; in which case, according to our theorists, it has 
 been more heavily taxed in its acquirement than either of 
 the preceding properties. So that in every case the pur- 
 chaser is merely exchanging: one kind of taxation for another, 
 when he buys property; and the new taxes are as really 
 taxation as the old. 
 
 "Hence taxes on property, of however long standing, 
 must bf> counted as honci-fide taxation of the owners, just as 
 muck as if they were taxes on income or expenditure." 
 
 Eeal property Again, it is confidently asserted that the value of real property 
 
 increased in has increased more rapidly than the Local Taxation, and, therefore, 
 
 value so much ^j^^^ ^]^g payment is less of a hardship now than formerly. Part 
 
 property. of this is onlv an apparent increase ni value, becauee tiie assess-
 
 LOCAL TAXATlOl^. 49 
 
 ir.ents are now more accurately made tliau formerly. Much, 
 also, of the actual increase is due to the energy and enterprise of 
 owners and occupiers, who have invcKsted capital in improvements, 
 which they might have employed otherwise, so that it should 
 not be subject to the rates. Bat is the increased value of 
 real property any reason for perpetuating an injustice ? Has 
 not the value of other kinds of property increased in a 
 greater ratio than that of real property ? Mr. Purdy calcu- 
 lates that, during the fifty years between 1815 and 18G5,* 
 whilst land rental increased 36 per cent., the profits of trades and 
 professions increased 212 per cent. But it is now very generally 
 allowed that gold has depreciated in value since the Californian 
 and Australian gold discoveries in 1848 and 1850. Mr. Jevons,t 
 in 1863, estimated this depreciation at 15 per cent. ; so that, even 
 if there has been no further depreciation since 1863, it would 
 appear that rental has only increased 21 per cent, as against 
 197 per cent, increase of the profits of trades and professions ; 
 and it should be noted that, in Mr. Purdy's calculation, no allow- 
 ance is made for the present more accurate valuation of real 
 property, or for the un returned profits of trades and professions, 
 before alluded to, which wonld have the efi'ect of lowering the 
 per centage of increase of the former and raising that of the latter. 
 Mr. MillJ has a strange theory on the subject of the increase 
 of value in land. He asserts — 
 
 " That land is an exception to the ordinary rule of equality 
 of taxation, because, with the increase of population, it spon- 
 taneously increases in value without any exertion or sacrifice 
 on the part of the owners, but with complete passiveness on 
 their part ; so that it would be no violation of the principles 
 on which private property is grounded, if the State should 
 appropriate this increase of wealth, or part of it, as it arises, 
 instead of allowing it to become an unearned appendage to 
 the riches of a particular class." 
 
 If this theory be correct, then, in all equity, it must be applied 
 to the owners of every kind of property. The State would have 
 
 * Joui'nal of Stat. Soc, vol. sxsii., pt. iii., p. 318. 
 
 t See a Pamphlet published by Messrs. Stanford, Charing Cross, 1863. 
 
 X " Political Economy,'' Book v., c. ii-, s. 5. 
 
 E
 
 50 LOCAL TAXATION. 
 
 a right to appropriate any part of a merchant's profits which was 
 unearned. If, after a merchant had laid in a stock of goods, the 
 prices rose, the State ought to appropriate the increased value, 
 or part of it, because the increase is not due to an}^ " exertion " 
 on the part of the merchant, but has arisen " with complete 
 passiveness " on his part ; but land and houses are frequently 
 bought by speculators, who give a high price in the hope of an 
 increase in their value. Here, as in the case of merchants, there 
 is a risk that they may have miscalculated, and that the value 
 should fall instead of rise. Moreover, if the State may appro- 
 priate the " spontaneous increase " in value of property, it must 
 also ensure the owner against decrease, and all stimulus to 
 industry and improvement in every line would thereby be removed, 
 and the effect would be a speedy demoralization of the community. 
 Mr. Dudley Baxter says* that — 
 
 '' Stripped to its kernel Mr. Mill's theory is simply this, 
 that landowners are only entitled in strictness to a rent-charge 
 upon their estates, and that the improving interest and its 
 disposal is the property and prerogative of the State. But 
 this is a clause out of a totally different creed as to the rights 
 of property, and a different policy from tliose which have 
 formed the foundation of the laws of England." 
 
 The gro^rtli of It has already been shownf that the great increase of wealth 
 commensurate <iuring the last fifty years has been chiefly commercial and pro- 
 
 with the fessional ; it is also an ascertained fact that the immense growth 
 
 increase of ... . , , . 
 
 commercial of pauperism in the country has been commensurate with this 
 
 wealth. increase. We do not say that the whole of the pauperism is to 
 
 be laid at the door of commerce ; bub a great proportion is 
 certainly due to failures, commercial panics, and dislionest specu- 
 lations. Failures and panics cannot always be foreseen and 
 avoided; but they entail a vast amount of misery and distress 
 on the working population. In every manufacture there is a 
 tendency for supply to outrun the demand for consumption. This 
 is a necessary consequence of the activity of trade. "When this 
 happens there is a glut in that particular manufacture, and the 
 manufacturer reduces the number of his work-people. Again, 
 the supply of raw material necessary for carrying on a manufac- 
 * " Taxation of United Kingdom," ch. xi., p. 57. t P. 49, supra.
 
 LOCAL TAXATION. 51 
 
 ture may tail. Xo one can have forgotten how the failure of the 
 cotton supply, during the late American civil war, affected the 
 cotton manufactures in Lancashire. Thousands upon thousands 
 of operatives were thrown out of work, and, had it not been for 
 the noble liberality of those wlio came forward voluntarily to 
 help them, the distress would have been still more severely felt. 
 Dishonest speculation, too, contributes its quota of the misery. 
 A failure ensues, and tliere is no resource for those who were 
 employed but to come upon the rates, paid by the occupiers of 
 the neighbouring land and houses, for support. Many of them, 
 moreover, cannot turn their hands to any other work than that 
 to which they have been accustomed. 
 
 Professor Leone Levi computes that, on the average, the 
 labouring classes are out of work only four weeks in the 
 fifty-two ; Mr. Dudley Baxter, however, thinks the state of 
 affairs far different. And, indeed, no one can see the numbers 
 of people who are constantly seeking for employment, and are 
 livinnj in a state of semi-starvation, without believing that Mr. 
 Baxter is more likely to be right, when he says that* 20 per 
 cent, ought to be deducted from the nominal full-time wages. 
 Mr. Baxter made this computation in 1868 ; bnt it would seem 
 that even this deduction is not sufficient for the present time, so 
 much has the demand for labour fallen off. Multitudes, even of 
 skilled labourers, have been discharged from our dockyards and 
 manufactories, who can find no employment elsewhere ; but such 
 is their innate respectability and love of independence, that 
 numbers will pawn their necessary clothing, and endure even to 
 starvation point, rather than lose their self-respect by applying 
 for relief. Tlie distress and suffering to be seen daily amongst 
 these artisans is hardly conceivable. 
 
 It would be very instructive if the Poor Law Board would 
 issue a return giving the proportional numbers of those relieved, 
 in the various divisions and Unions of England and Wales, to 
 each of the four classes of occupation — domestic, commercial, 
 agricultural, and industrial. At the census of 1861, out of a 
 total of 10,983.558t of persons aged 20 years and upwards, the 
 agricultural population numbered 1,605,503, or 14-6 per cent. ; 
 and the industrial or artisan class numbered 3,746,788, or 34-1 
 
 * " National Income," ch. iv., p. 4/. 
 
 t Twenty-first Eeport of the Poor Law Board. App. C. Xo. 31, p. 244.
 
 bZ LOCAL TAXATION. 
 
 per cent. Is it just that land, titlies, and houses sliould be 
 called upon to support the trade-made poor ? When we con- 
 sider the enormous incomes that are acquired, and the vast 
 amount of capital that is amassed by means of the labour of 
 these very poor, is it equitable that those who benefit by their 
 labour sliould contribute nothing to their support ? 
 Non-liability j^ js argued that the State has no right to tax income derived 
 
 to taxation. from the funds ; and to prove this, the original Act* of 1G92 is 
 quoted. Under this Act a million was raised by Life Annui- 
 ties, and as each annuity fell in it was to be divided amongst 
 the others, until there were only seven survivors; after that 
 I time the public were to gain. The interest was to be 10 per 
 
 ' cent, till the year 1700 ; and after that year 7 per cent. The 
 
 Act provided that money lent " shall not be charged or charge- 
 able with any rates, duties, or impositions whatever." All sub- 
 sequent Acts for borrowing money have words to the like effect. 
 It is contended, therefore, that the State is bound by law and 
 honour to maintain the exemption of the owners of funded pro- 
 perty from Local Taxation. Those who argue this forget that the 
 State already levies Income-tax under Schedule C from these; 
 and that this Income-tax increases or diminishes according to the 
 necessities of the national exchequer. Besides, no one proposes 
 to rate the property — i.e., the principal — in the funds, but only 
 the income derived therefrom ; and this would no more be a 
 breach of faith than is the Income-tax for Imperial purposes. 
 The fundholder enjoys the interest of his investment in security 
 and comfort, and there is no reason why he should expect the 
 owners of real property to pay for his advantages. In the reign 
 of William and Mary there was not this security. It was by no 
 means impossible that there should be a revolution restoring the 
 Stuarts ; and then all who had advanced money to the govern- 
 ment of William would have lost both principal and interest. 
 Eeal property It cannot be said that real property is now in possession of 
 Taf^rivile%^' ^^y exclusive privileges which would justify its bearing so large 
 a share of the national burdens. By the abolition of the shilling 
 duty on imported corn the last rag of protection has been torn 
 away. It is allowed that the possession of property in land 
 gives dignity to the possessor, and that the occupation of farming 
 is pleasant and health-giving ; and therefore that incomes from 
 * 4th and 5tli William and Mary, c 3., s. 26.
 
 LOCAL TAXATION. 53 
 
 these sources slionld bear a somewhat larger amount of taxation 
 in the aggregate than incomes from personal property. Mr. 
 Baxter is of opinion that these incomes should pay a per centage 
 of taxes one-fifth higher than incomes derived from personalty. 
 Again, incomes derived from personal property should be taxed 
 at a higher rate tiian incomes that are called industrial, which 
 are precarious in their nature. All professions and appoint- 
 ments which are for life, or of which the income is fluctuating, 
 ought to pay less than incomes from personal property. Mr. 
 Mill considers that one-fourth of these fluctuating or industrial 
 incomes should be exempt from taxation. 
 
 " A man with £500 a year from business would consider 
 his family well provided for at his death by an insurance or 
 savings producing £250 a y^r — that is to say, by a capital 
 of £6000. This amount, insured on a good life, and com- 
 mencing at 26 years of age, will cost in premiums about 
 £125 a year, or one-fourth of his income. Savings (which 
 avoid the stamp-duty, expenses, and profit of insurance com- 
 pany) ought, on an average length of life, to produce the 
 same capital from a less annual sum. Hence, one-fourth is 
 a fair allowance ot exemption for an industrial income." 
 
 Xow, in levying a single tax, it is impossible to adjust it in 
 this manner to the different classes of income ; but the aggregate 
 amount paid by each ought to approximate to this proportion, 
 in order that the burden of taxation may be fairly borne. But 
 it has been shown in Table X. that 
 
 Class I. — Income from real property pays 10'2 per cent. 
 Class II. — ., of occupiers of laud ,, 11"0 ,, ,, 
 Class III. — „ from other sources „ 4-2 „ „ 
 
 And Class III. comprises owners of incomes from personal pro- 
 perty, and of industrial incomes ; and it is probable that the 
 former pay 5-4 per cent., and the latter 3 per cent. 
 
 Thus, the per centage on the incomes of the owners of land 
 and houses is doable, and that of occupiers of land nearly 1 per 
 cent, more than double that paid by incomes from realized pro-
 
 54 LOCAL TAXATION". 
 
 perfcy ; whilst industrial incomes are charged with less than 
 one- third the taxation that is borne by Classes I. and II. 
 
 "When, therefore, it is asserted that incomes from real pro- 
 perty do not bear a fair proportion of taxation, because real pro- 
 perty is exempt from probate-duty, it may be confidently answered 
 that the very reverse is the true statement of the case ; for that 
 real property bears a far greater proportion of the aggregate 
 taxation of the country than is due. And this may be indis- 
 putably proved by statistics. 
 
 As Mr. Disraeli* said in 1851 : — 
 
 " The Government interferes with no other property or 
 interest as it does with the landed (or real property). Sup- 
 pose the same laws applied to manufacturers. What 
 speeches ! what leagues we should have !" 
 
 * " Times;' Feb. lltli, 1851.
 
 CHAPTEE Y. 
 
 The objects, to wMcli the proceeds of Local Taxation are applied, The objects an 
 may be divided into two groups : — 2ud°local! * 
 
 First. — Those which are national. 
 Second. — Those which are purely local. 
 
 In the first group would be placed the tax which is called 
 Poor-rate, every item of which is expended on objects more or 
 less national in their character, and for the welfare of the public 
 generally. The same may be said of the amount levied for 
 County, Hundred, Borough, or Police Eates, in those cases where 
 these are not paid out of the Poor-rate. The taxes in this group 
 amount to £11,361,74:5. 
 
 Can it be denied that all classes of the community derive 
 protection for their property and safety for their persona through 
 the existence and operation of the Poor-laws, whether they are 
 owners or occupiers, manufacturers, merchants, or tradesmen? 
 Sir George Cornewall Lewis, in his evidence before the Com- 
 mittee of the House of Lords,* gave his opinion very clearly in 
 ansvrer to the questions asked him : — 
 
 " Q. 2378. The object of my question was rather to 
 elicit your opinion upon the question, whether that general 
 system of liability which attaches to all realized property to 
 maintain the poor of the country, would attach equally to 
 annual profits ? — Yes ; I see no reason why annual profits 
 should not be as much taxed as the produce of realized 
 property, if a national Income-tax were in question. 
 
 " 2379. You think that a person deriving £1000 a year 
 from his professional business, or from any annual source, is 
 as reasonably, and in justice equally subject to maintain the 
 * Committee of the House of Lords on Parochial Assessments, 1850.
 
 56 LOCAL TAXATION. 
 
 poor as tlie owner of realized property is?— That involves 
 tlie question of a graduated Income-tax ; my own opinion is 
 unfavourable to a graduated Income-tax, as I wish to see all 
 persons contribute equally from their means, whether it be 
 realized property, or whether it be profits of trade or pro- 
 fessions. I am quite aware that it is an opinion which is not 
 generally acquiesced in, and that very specious arguments 
 may be adduced on the other side. 
 
 " 2380. I Avish to draw your attention to a principle 
 which seems different from the principle of a graduated 
 Income-tax. The first obligation attaching to all existing 
 property is generally admitted to be the obligation of main- 
 taining the existence of all persons in the country ; the 
 object of my question is, to ascertain your opinion as to 
 whether that obligation attaches upon the same grounds, and 
 upon the same principle, to profits which people are making 
 by individual exertions, as to realized property, which they 
 actually possess ? — Yes ; I see no reasou for making any 
 distinction. If I were imposing a national Income-tax, to 
 be applied to the relief of the poor, I should impose it 
 according to the same rate upon the profits of trade, upon 
 professions, and upon the produce of realized property. 
 
 " 2381. You think the claim of the poor to the right of 
 maintenance attaches with the same strength to profits which 
 an individual is making by his personal annual exertions, as 
 it does to realized property ? — Yes. 
 
 " 2382. The realization of those profits is the result of 
 the civilized institutions of the country ? — Yes. In order to 
 exercise industry with advantage, it is necessary that there 
 should be security of property. It is necessary that there 
 should be good communications. It is necessary that the 
 insurance of property which is paid by the relief of the poor 
 ("for it may be considered as a species of insurance) should 
 fall also upon that class of persons. 
 
 " 2383. Do you not consider that the existence of the 
 Poor Law in this country is a great protection to property ? 
 — I entertain no doubt whatever that a well-managed Poor 
 Law, not suffered to excite unreasonable expectations, but 
 carefully applied to the relief of the most pressing forms of
 
 LOCAL TAXATIOK. 57 
 
 destitution, must be considered as a very material addition 
 to the security of our institutions. 
 
 "2384. Not of property only, but of industry also? — 
 Yes ; it is difficult to distinguish between industry and pro- 
 perty. iSo doubt it is a material security to both." 
 
 But, again, are not all classes equally concerned in the 
 efficiency of the Police ? Is not the small-pox as terrible to the 
 merchant as to the yeoman? Why should real property be 
 charged with nearly the whole cost of maintaining coroner;? and 
 militia storehouses ? Why should coal mines contribute to the 
 support of the poor, whilst metallic mines are exempt ? Why 
 should a farmer pay for the inspection of a tradesman's weights 
 and measures ? 
 
 In the second group of objects, which are purely local in their 
 nature, would be placed Highway Rates, Lighting, and Watching 
 Rates, Public Health Rates, etc., and they amount to £5,365,429. 
 JN^ow these rates though expended on local objects, yet are for 
 the welfare of the whole community residing in the district where 
 they are levied. The waggons of the manufacturer cause as 
 much wear and tear to the highways as those of the iarmer. The 
 use of carriages is not confined to the owners of real property. 
 
 We have"^-" shown above that the Act of the 43rd of Elizabeth 
 contemplated that all should contribute according to their 
 ability ; but granting, for argument's sake, that real property 
 was intended by that Act, because it was then nearly the whole 
 wealth of the country ; will any one urge that this state of things 
 is to exist always, and that the changed circumstances of the 
 national wealth do not justify a corresponding change in the 
 taxation ? Will it be said that the State, finding the existing 
 system unjust and unequal, lias no right to alter it. In Queen 
 Elizabeth's time the trade of the country was in its infancy, and 
 the moneyed interest was unknown. It remained for the versatile 
 and vigorous mind of Montague to devise the scheme, which has 
 since developed into the largest national debt ever known. It 
 was under his auspices that the Bank of England was established, 
 the prosperity of which is bound up with the prosperity of the 
 country. In these days when the commercial, the manufacturing, 
 and the moneyed interest has increased so enormously, it is tune 
 * Page 9, siiypra.
 
 58 LOCAL taxatio:n'. 
 
 that they should bear their share of a burden which it is a public 
 duty to sustain. 
 
 It must be carefully borne in mind that this is a question 
 affecting ratepayers generally, whether residing in towns or in 
 the country. It is not a matter which is interesting only to the 
 landowner and farmer. It is a grievance that concerns the town 
 populations also ; and, contrary to one of the first principles of 
 taxation, the burden presses most on those who have small 
 incomes ; namely, upon the struggling tradesman as compared 
 with the opulent banker, upon the mechanic, or factory operative 
 •as compared with his employer. 
 
 Those who profess to believe that there is no unfairness in 
 the present system of Local Taxation, are continually attempting 
 to raise a false issue. They would persuade us, that the advocates 
 of a reform are setting class against class ; that the agricultural 
 interest is trying to throw the load upon the shoulders of the 
 town population ; that the landlords and owners are striving to 
 gain a benefit at the expense of the occupiers. Enough has been 
 advanced to show that there are no grounds for these charges. 
 It is the duty of all who profess to be friends of the working- 
 man, and would wish to see him living in a better and more 
 comfortable dwelling, and, where possible, with a plot of ground 
 for cultivation in his leisure hours, to labour to lighten his 
 burdens. It is the duty of all, who have regard for the broad 
 principles of morality and justice, to endeavour to obtain a redis- 
 tribution of the burden, well nigh intolerable in its present in- 
 -cidence, so that it may be placed upon a fair and equitable basis.
 
 CHAPTEE YI. 
 
 The consideration of the way in which these grievances are to be Various 
 
 /> T -I 1 ' 1 • 1 -. j_ Ti proposals or 
 
 reformed does not, properly speaking, beloDg to an essay iiKe reform. 
 
 the present ; but it may not be out of place to glance at some 
 
 of the suggestions that have been offered, and to attempt to show 
 
 how far they are practicable. 
 
 It has been proposed that a grant-in-aid from the Consoli- Grant from 
 dated Fund would meet the difficulties of the case ; but such a Fund, 
 grant would not remove the injustice of the practice by which 
 real property alone is rated. The burden of the rates would, 
 it is true, be lightened; but the rates would still be levied on 
 one class of property, and this is the anomaly which requires to 
 be reformed. Moreover, such a grant would be a compromise 
 which would supplement one injustice by another. The com- 
 munity of the United Kingdom contribute to the Consolidated 
 Eund, and it w^ould not be just to require the taxpayers of 
 Scotland and Ireland to give towards the relief of the poor of 
 England and "Wales. 
 
 Much more practicable is the proposal that the present a national 
 system of rates should be abolished, and a national rate be levied ^asts^of the 
 on the basis of the Income-tax assessment ; but it is urged Income-tax 
 ao-ainst this scheme that the funds would then be administered 
 
 o 
 
 with reckless extravagance ; that, under the present system, the 
 guardians of each union are personally interested in an econo- 
 mical expenditure, and that the ratepayers would call them to 
 account at the first instance of any disregard of economy ; but 
 that this wholesome check would be at once removed when the 
 o-uardians could draw upon a national fund, and, in fact, that 
 each union would then strive to grasp as large a share of this 
 fund as it could induce the authorities to grant. Without any 
 doubt there is a great deal of truth in this argument, and, if one 
 check be removed, it certamly becomes necessary to obtain some 
 other guarantee for economy. Would not such a guarantee be
 
 60 
 
 LOCAL TAXATIOI^'. 
 
 oLtatned by the adoption of a plan somewhat similar to that 
 suggested by Lord Malmesbury in 1S50 — namely, that a limit 
 should be fixed to the demands of each union district on the 
 proposed national fund ? This limit might be determined by 
 taking the average expenditure of a certain number of years, 
 and making a grant to that amount, holding the guardians 
 responsible for all they expended in excess of such grant ; and 
 this rule should never be relaxed, except under the most pressino- 
 circumstances, such, for instance, as the late distress in Lanca- 
 shire. The necessity for such departure from the rule ought to 
 be certified, after strict investigation, by authorities having no 
 immediate or personal interest in the district. A Special Board, 
 appointed by the Poor Law Board, consisting of Poor Law 
 Inspectors, would answer the purpose, without any great extra 
 expense being incurred. Such a system might with advantage 
 be applied to taxation in aid of relief to the poor. Without any 
 doubt the present system of local management would have to be 
 modified in some degree, but all are agreed that the principle 
 must be retained, it being especially dear to the Anglo-Saxon 
 mind, which has an instinctive dread of centralization. It can- 
 not, however, be expected that any government should hand over 
 funds to local authorities without retaining in their hands the 
 right of insisting upon a proper and economical use being made 
 of their grants. Some have proposed that the Poor Law Inspec- 
 tors should be ex officio Chairmen of Boards of Grnardians, thus 
 combining local management with a direct supervision by the 
 agents of the central authorities. JSTow, it would naturally be 
 expected that a proposal for the equalization of rates throughout 
 the country would, at all events, meet with the approval of those 
 unions where the rates would be reduced considerably, even if 
 some amount of local consequence and fancied dignity had to be 
 resigned by the guardians; but it does not follow that such 
 would be the case. A writer in the " Quarterly U-eview "* very 
 forcibly points out the want of public spirit in local administra- 
 tion. 
 
 He points to " Our whole system of Municipal Adminis- 
 tration, with its inextricable confusion, and its astound- 
 ing and costly inefiiciency — imbued throughout with the 
 
 * '' Quarterly Eeview," No. 253, July, 1869, p. 46.
 
 LOCAL TAXATIOIS". Gl 
 
 ' vestry ' spirit, guided everywhere by tlie ' vestry ' mind. 
 Men elected by household suftrage, often practically by the 
 lowest householders under the influence of the corruptest 
 motives, for the most part immersed in their own private 
 businesses, usually half-educated and always quite untrained 
 in administrative functions, are entrusted with the manage- 
 ment of large funds, and the direction of the most important 
 social and civic undertakings, such as police, ligliting, paving, 
 draining, scavenging, etc., and discharge them, — as we see. 
 Grocers, and publicans, and speculative builders, or the 
 nominees of less enlightened classes still, determine what 
 rates shall be levied, and how they shall be expended ; ap- 
 point amateur surveyors of roads, perfunctory inspectors of 
 nuisances, commissioners or boards of public works ; em- 
 ploying fragments of their time, and the spare portions of 
 ' what they are pleased to call their mind,' on objects which 
 might well task the full powers of the best professional 
 capacities. In this enormous overgrown metropolis, the evils 
 of this inappropriate system are even more salient than else- 
 where, and, while more manifest and more monstrous, are 
 more difficult to deal with ; and we are virtually managino- 
 and governing the greatest city, or congeries of cities, in the 
 world, through the antiquated machinery of a dozen vestries, 
 aided by half a dozen boards improvised for special services, 
 but often, like the vestries themselves, consisting of un- 
 trained functionaries. Yet so deeply is the notion of vestry 
 rule ingrained in the middle-class English mind, that, keenly 
 as we all feel the discredit and discomfort of this state of 
 things, it seems as if no Grovernment could summon up the 
 combined strength, courage, and capacity to grapple with 
 the mischief, and apply a remedy." 
 
 Mr. Groschen, in a speech on the Metropolitan Poor Law 
 Amendment Bill, mentioned a fact indicative of the sort of petty 
 motives and narrow views which often govern Boards of Guardians. 
 Speaking of the amalgamation of unions, he said : — 
 
 ^' In this matter there was rather delicate ground for 
 him to touch upon, but he felt it his duty to do so. In the 
 City of London there were three unions— the City of London
 
 62 LOCAL TAXATION. 
 
 proper, with rateable property valued at £1,800,000 ; and tlie 
 West London and the East London, each of which had rate- 
 able property valued at £200,000. In the first-named of 
 these unions the rate was only 7cl. in the pound ; in each of 
 the two others it was 3s. The Poor Law Board had asked 
 the guardians of the two latter unions whether they would 
 consent to their own dissolution, in order that they might 
 be united to the rich union, the City of London proper, 
 whereby their rates would be reduced from 35. to lid. or Is. 
 He had not- received an answer to that question ; but from 
 the proceedings of the West London Union he perceived 
 that the guardians were much dissatisfied with the proposal. 
 Indeed, it would appear from their debate that there was no 
 chance of their consenting to it. He had imagined that the 
 union of the City of London proper might be opposed to his 
 proposal; but he had not supposed that the poorer unions 
 would object to a scheme which would reduce their rate so 
 considerably." 
 
 It is, however, to be hoped, that those ratepayers who in 
 many places are paying as much as 5^., (5s., and even 7s. in the 
 pound,* will see the advantage of introducing a system by which 
 they would, at the very highest calculation, have to pay Is. This 
 result may be obtained by extending tlie area of Local Taxation 
 for objects of a "national character to the wider basis of the 
 Income-tax assessment, with some modifications. Numbers o 
 those who are assessed under Schedule D would, no doubt, con- 
 trive to evade the payment; for it is not to be expected that 
 those who make a-practice of defrauding Her Majesty's revenue 
 by understatiug their incomes, would cease to do so when taxed 
 for other purposes under the proposed system. The exemption 
 of a certain amount of income might be allowed ; perhaps £50 
 would be a fair maximum. It will be allowed that this is not 
 more than suSicient to provide its owner with the mere neces- 
 saries of life, especially if he has a family, as is the case with 
 many of the working classes, whose incomes on the average do 
 not reach £60 a year. The maximum amount to be exempted, 
 being fixed, should be deducted from every income. Thus the 
 possessor of an income of £50 per annum would not be rated, the 
 * See Table IV., page 18.
 
 LOCAL TAXATION. 63 
 
 possessor of an income of £100 per annnm Tvould be rated on 
 £50. Mr. Mill originally enunciated this principle of obriating 
 the inequality in the Income-tax, by which the possessor of an 
 income of £99 would escape taxation ; but the possessor of an 
 income of £100 ^Y0uld pay the ordinary per centage. Mr. Glad- 
 stone adopted this principle in a modified form in his Budget of 
 1863. And all incomes below £100 per annum are exempt: 
 whilst the possessors of incomes between £100 and £200 per 
 annum are allowed to deduct £60, and pay Income-tax on the 
 remainder. 
 
 With regard to the objection, that a national fund adminis- The pi-inciple 
 tered by local authorities would necessarily lead to great extrava- fund may be 
 gance, it may be pointed out that Mr. Goschen's Metropolitan ^^"^Jaf autho- 
 Poor Act (1867) Amendment Bill has already admitted the rities lias been 
 principle, without any guarantee or check against unlimited ^ °^ • 
 expenditure by particular unions of general funds contributed 
 by the unions of the Metropolis. By this Bill, any excess of 
 expenditure above a specified rate in the pound is to be repaid to j 
 
 the guardians of any union in the ?.Ietropolis out of the Metro- 
 polis Common Poor Pund. Kow, if this principle is applicable 
 to the Metropolis, why should it not be extended to the country 
 generally ? There is, moreover, great reason to believe that, by 
 the introduction of a uniform system of administration in Eng- 
 land and Wales, a great saving would be efiected, which at present 
 is hardly possible, when each Board of Guardians has its own 
 system. 
 
 It may not be amiss to direct attention to the system pursued System in 
 in the United States of America, A correspondent of the ^J- J' °* 
 ** Journal of the Chamber of Agriculture " * writes, that in the 
 United States " all municipal and state taxes are assessed on the 
 entire property, real and personal, of every description, held by 
 the inhabitants of towns and cities (that is, parishes). The 
 municipal authority of each city or town (equivalent to our 
 borough or parochial authority) first determines and fixes the 
 amount of money to be raised for all branches of the public 
 service — as, a certain sum for highways, a certain sum for the 
 support of schools, a certain sum for the support of the poor, " 
 etc. — the estimates being based upon the experience of past years 
 
 * " Journal of Chamber of Agriculture," No. 25, March 9, 18G9, p. 204.
 
 (j4 LOCAL TAXATION. 
 
 as a guido to tiio probable amounts that' may be required for tlie 
 current 3'ear. After the fiLll amount required for any city or 
 town (parish) is determined, there is added to such sum the 
 proportion of state and county taxes 'assessed on such city or 
 town. Then this total contribution is assessed by the assessors 
 of th^ city or town upon the real and personal property of the 
 citizens. E-ich citizen is required by law to render to the asses- 
 sors a full and accurate valuation of his entire propert}'-. He 
 can be put on oath by the assessors ; and, when there is reason 
 to believe the valuation not correct, the assessors can change 
 and amend it. Agricultural implements, the tools of mechanics 
 up to a given value, and a given amount of household furniture 
 for poor people, are exempt from taxation and attachment. Thus, 
 Poor-rates and other taxes are assessed on the entire property of 
 citizens, who are able to pay. When a person has property in 
 one town or State where his home is not situated, that property 
 is taxed in the town where it is located. Each State provides for 
 the poor witlnn its limits, if a settlement there has existed for 
 the time required by law. If it cai^be shown that the settlement 
 is in some other State, the poor needing relief are returned to 
 the State where they have a right to claim a residence or 
 support." 
 
 It is a feeling th.at has been increasing of late years, that a 
 reform in the various matters that have been discussed is neces- 
 sary to suit the altered requirements of the times ; neither can 
 the consideration of measures for lightening the burdens now 
 pressing unduly upt»n real property be much longer postponed. 
 It is a subject which may be discussed without the bitterness of 
 a party contest ; and it is only reasonable to hope that a Ee-' 
 formed House of Commons, which has not shrunk from the 
 arduous task of attempting the pacification of Ireland, will not 
 feel itself unwilling or unable to remove a grievance which presses 
 most unjustly upon many of the most peaceable and law-abiding 
 of Her Majesty's subjects. 
 
 F. BEITTIET AND CO,, PBIKTEES, LONDON.