8279. TAXATION, Basis of.—
The taxes
with which we are familiar, class themselves
readily according to the basis on which they
rest. 1. Capital. 2. Income. 3. Consumption.
These may be considered as commensurate;
Consumption being generally equal to Income,
and Income the annual profit of Capital.
A government may select any one of these
bases for the establishment of its system of
taxation, and so frame it as to reach the faculties
of every member of the society, and to
draw from him his equal proportion of the
public contributions; and, if this be correctly
obtained, it is the perfection of the function of
taxation. But, when once a government has
assumed its basis, to select and tax special
articles from either of the other classes, is
double taxation. For example, if the system
be established on the basis of Income, and
his just proportion on that scale has been already
drawn from every one, to step into the
field of Consumption, and tax special articles
in that, as broadcloth or homespun, wine or
whiskey, a coach or a wagon, is doubly taxing
the same article. For that portion of Income
with which these articles are purchased, having
already paid its tax as Income, to pay
another tax on the thing it purchased, is paying
twice for the same thing, it is an aggrievance
on the citizens who use these articles
in exoneration of those who do not, contrary
to the most sacred of the duties of a government,
to do equal and impartial justice to all
its citizens. How far it may be the interest
and the duty of all to submit to this sacrifice
on other grounds; for instance, to pay for a
time an impost on the importation of certain
articles, in order to encourage their manufac
ture at home, or an excise on others injurious
to the morals or health of the citizens, will
depend on a series of considerations of another
order, and beyond the proper limits of
this note. * * * To this a single observation
shall yet be added. Whether property
alone, and the whole of what each citizen
possesses, shall be subject to contribution, or
only its surplus after satisfying his first wants,
or whether the faculties of body and mind
shall contribute also from their annual earnings,
is a question to be decided. But, when
decided, and the principle settled, it is to be
equally and fairly applied to all. To take
from one, because it is thought that his own
industry and that of his fathers' has acquired
too much, in order to spare to others, who,
or whose fathers have not exercised equal industry
and skill, is to violate arbitrarily the
first principle of association, “the guarantee
to every one of a free exercise of his industry,
and the fruits acquired by it”. If the overgrown
wealth of an individual be deemed
dangerous to the State, the best corrective is
the law of equal inheritance to all in equal
degree; and the better, as this enforces a law
of nature, while extra-taxation violates it.—
Note in Destutt Tracy's Political Economy. Washington ed. vi, 573.
(1816)
