But when a tax is imposed upon the profits of stock employed in agriculture, it is not the interest of the farmers to withdraw any part of their stock from that employment.Each farmer occupies a certain quantity of land, for which hi pays rent.For the proper cultivation of this land a certain quantity of stock is necessary, and by withdrawing any part of this necessary quantity, the farmer is not likely to be more able to pay either the rent or the tax.In order to pay the tax, it can never be his interest to diminish the quantity of his produce, nor consequently to supply the market more sparingly than before.The tax, therefore, will never enable him to raise the price of his produce so as to reimburse himself by throwing the final payment upon the consumer.The farmer, however, must have his reasonable profit as well as every other dealer, otherwise he must give up the trade.After the imposition of a tax of this kind, he can get this reasonable profit only by paying less rent to the landlord.
The more he is obliged to pay in the way of tax the less he can afford to pay in the way of rent.A tax of this kind imposed during the currency of a lease may, no doubt, distress or ruin the farmer.Upon the renewal of the lease it must always fall upon the landlord.
In the countries where the personal taille takes place, the farmer is commonly assessed in proportion to the stock which he appears to employ in cultivation.He is, upon this account, frequently afraid to have a good team of horses or oxen, but endeavours to cultivate with the meanest and most wretched instruments of husbandry that he can.Such is his distrust in the justice of his assessors that he counterfeits poverty, and wishes to appear scarce able to pay anything for fear of being obliged to pay too much.By this miserable policy he does not, perhaps, always consult his own interest in the most effectual manner, and he probably loses more by the diminution of his produce than he saves by that of his tax.Though, in consequence of this wretched cultivation, the market is, no doubt, somewhat worse supplied, yet the small rise of price which may occasion, as it is not likely even to indemnify the farmer for the diminution of his produce, it is still less likely to enable him to pay more rent to the landlord.The public, the farmer, the landlord, all suffer more or less by this degraded cultivation.That the personal taille tends, in many different ways, to discourage cultivation, and consequently to dry up the principal source of the wealth of every great country, I have already had occasion to observe in the third book of this Inquiry.
What are called poll-taxes in the southern provinces of North America, and in the West Indian Islands annual taxes of so much a head upon every negro, are properly taxes upon the profits of a certain species of stock employed in agriculture.As the planters are, the greater part of them, both farmers and landlords, the final payment of the tax falls upon them in their quality of landlords without any retribution.
Taxes of so much a head upon the bondmen employed in cultivation seem anciently to have been common all over Europe.
There subsists at present a tax of this kind in the empire of Russia.It is probably upon this account that poll-taxes of all kinds have often been represented as badges of slavery.Every tax, however, is to the person who pays it a badge, not of slavery, but of liberty.It denotes that he is subject to government, indeed, but that, as he has some property, he cannot himself be the property of a master.A poll-tax upon slaves is altogether different from a poll-tax upon freemen.The latter is paid by the persons upon whom it is imposed; the former by a different set of persons.The latter is either altogether arbitrary or altogether unequal, and in most cases is both the one and the other; the former, though in some respects unequal, different slaves being of different values, is in no respect arbitrary.Every master who knows the number of his own slaves knows exactly what he has to pay.Those different taxes, however, being called by the same name, have been considered as of the same nature.
The taxes which in Holland are imposed upon men- and maid-servants are taxes, not upon stock, but upon expense, and so far resemble the taxes upon consumable commodities.The tax of a guinea a head for every man-servant which has lately been imposed in Great Britain is of the same kind.It falls heaviest upon the middling rank.A man of two hundred a year may keep a single manservant.A man of ten thousand a year will not keep fifty.It does not affect the poor.
Taxes upon the profits of stock in particular employments can never affect the interest of money.Nobody will lend his money for less interest to those who exercise the taxed than to those who exercise the untaxed employments.Taxes upon the revenue arising from stock in all employments where the government attempts to levy them with any degree of exactness, will, in many cases, fall upon the interest of money.The Vingtieme, or twentieth penny, in France is a tax of the same kind with what is called the land-tax in England, and is assessed, in the same manner, upon the revenue arising from land, houses, and stock.So far as it affects stock it is assessed, though not with great rigour, yet with much more exactness than that part of the land-tax of England which is imposed upon the same fund.It, in many cases, falls altogether upon the interest of money.Money is frequently sunk in France upon what are called Contracts for the constitution of a rent; that is, perpetual annuities redeemable at any time by the debtor upon repayment of the sum originally advanced, but of which this redemption is not exigible by the creditor except in particular cases.The Vingtieme, seems not to have raised the rate of those annuities, though it is exactly levied upon them all.
Appendix to ARTICLES I and II.