RATE OF TAXATION UNDER STATE AUTHORITY. The average prevailing rate of that local taxation cannot be precisely stated for want of time to collect all the data. Nor is it necessary for this inquiry, as it is impossible to ascertain exactly the proportion of the United States securities owned by persons residing in cities and municipalities, although it is probable that the largest portion is owned by such persons. The total valuation of property in the city of Boston for the year 1864 was $332,449,900-over one third of that of the whole state of Massachusetts. The amount of local taxes levied was $4,421,583 67. The rate of taxation was 1.35 per cent. The population by the census of 1860, was 177,818. The local taxes levied in the city of New York, for 1864, The total of valuations was over one third the entire value of taxable property in the state of New York in 1860. The rate of taxation was 2.16 per $100, of which 99 per cent. was for state and county purposes. The rate of taxation in 1865 was 2.99 per $100. The population, by the census of 1860, was 805,651. Had population remained stationary, the value of taxable property per capita, would be, in New York, $707 70; in Boston, $1,869 43. As the object is to ascertain their proportions, and we must use the census returns of 1860 for the general population, these are the proper figures for the purpose in view. The population in 1860, of seventy-four of the cities and towns exceeding 10,000 in number of inhabitants, was 4,389,488. The average population was 59,317. The average value per capita, for the whole United States, of the $15,000,000,000 of property subject to taxation under state authority, is $478. Taking this sum for the lowest term, and the per capita value for New York city, $787 70, for the highest, we obtain an ap proximate average of $632 85 as the per capita value for the seventy-four cities and towns, and $2,777,887,480 as the aggregate value. These are only a part of the cities and towns exceeding 10,000 in population; for example-without looking further than Illinois-Springfield, Belleville, Bloomington, and Aurora, all large towns, are omitted. An incomplete list of forty-one incorporated towns having between 5.000 and 10,000 inhabitants, shows an aggregate of 291,924. The incorporated towns and cities not included in either of these lists, which are very numerous, certainly have an aggregate population of 1,652,301, which will bring the total up to 6,333,713. Allowing $500 as the per capita value of the property of all not included in the first list, we have $972,112,520, and for the total of the property of all incorporated towns and cities, $3,750,000,000. If this estimate be correct, more than one fifth of the inhabitants, and one third in value of the property in the United States, are subject to municipal taxes, in addition to the state and county or township taxes which they pay in common with the rest of the iahabitants. These municipal taxes in many cities amount to two per cent., while in others they are less than one per cent.-They probably average one per cent., and yield annually $37,500,000. The additional local taxes, which are levied everywhere, are for state, county, or township, road, and school purposes. These, with special war-taxes, to pay for moneys expended in recruiting and bounties to the soldiers, are as high as five per cent. in a number of counties; leaving the special taxes out of view, they will probably average nearly one per cent. We have seen that in New York they are 99 of one per cent. If they were only 66% of one per cent. the average of all taxes, under state authority, including municipal, would be just one per cent., and that figure may be taken as a fair equation of all the taxes by or under state authority. At that estimate the local revenues would be $150,000,000. The only tax paid for any purpose by those whose property is all in the government securities, except the tax paid on articles of consumption, which is nearly as large, and a thousand times more onerous on the laborer, than on the millionnaire, is the tax on incomes. This tax is more easily evaded by the bondholder than by any one else. When the local assessor calls he can show his bonds, and the business of the assessor is at an end with him. When the assessor of the general government calls, his bonds. may be held on foreign account-at all events, he alone knows the amount. Whether honest or dishonest, he has no tax to pay if he hold but ten thousand dollars in gold six per cents. His neighbors are taxed to pay bounties for the substitutes for his sons when the country claimed their services in the field. They are taxed to pave and light the streets and adorn the parks in which he takes the air, to afford schools for his children, to provide courts and juries, and policemen for the protection of his person, and to preserve from the robber or the burglar the very bonds in question. From all these reasonable taxes he is exempt. The fact of this exemption, with no equivalent taxation, is known, and is causing irritation all over the land. It is felt as a hard and unjust discrimination, against those who have tied themselves to the country by becoming owners of the soil, and who are using their means in adding to the wealth of the nation by fair and honest industry. Explain to them that it was right to secure the national funds and credit from the danger of destructive taxation by the states, reserving to the United States the sole power to tax; and exercise that power, so that the burden may be borne by all alike, and they will be satisfied. Refuse to exercise that power, and men may be elected to office who will exercise it, and that to destroy. It should be borne in mind, also, that the present political calm, the present oblivion of party, will soon be followed by the strife of another presidential election. In less than two years, issues will have been made up, parties will have arrayed themselves again, and the people will sit in judgment on all the momentous questions of the day. It can easily be demonstrated that the $447,000,000 which it is estimated the General Government will collect the present fiscal year, almost entirely by indirect taxes on production and consumption, will be increased to the tax-payers on the average not less than one half, by per-centages necessarily charged by wholesale and retail dealers before the commodities reach the consumers. We now leave out of view the much greater loss of values from being compelled to buy articles produced in violation of the laws of political economy, at a cost greatly in excess of the natural cost of production in other countries, where circumstances are favorable to their production, and from being compelled to buy of persons who are given a monopoly of the market. Apart from this consideration, the actual payment of money by the taxpayers, to yield $447,000,000 to the Government, will be $223,500,000 more, which makes the amount of moneys paid and the amount of the taxation, as far as the consumers are concerned, $670,500,000, Taking the average ownership of bonds to be $5,000 to each of the owners, their proportionate part of the indirect taxation would be $1,400,000. Therefore, while the owners of the fifteen thousand millions of property pay in local taxes $150,000,000, they, and others who have no property in the funds, pay on account of United States taxes, $669,100,000, or within $40,060,781 of the net earnings of the entire people during the fiscal year 1860.* With the amount of their local taxes they pay $109,939,219 more than their net earnings. The gross earnings of the people are not materially greater now than in 1860, the consumption of earnings is certainly not less. The local tax-payers are, therefore, losing this year from their capital not less than one hundred and nine millions of dollars from this cause alone. But this is not all. The local taxes are apportioned upon the just principle of assessment upon property. The owner of one hundred thousand dollars' worth pays one hundred times the amount paid by the owner of one thousand dollars' worth, because he is presumed to have one hundred times the ability to pay, and one hundred times the amount of property to be protected. For the protection of other rights, the man of small property pays more than his proportion by his personal services on juries, on the posse comitatus, and in the army. If this amount of indirect taxes were apportioned upon the same principle, the ratio of taxation would be 4 per cent. If these taxes were apportioned upon the owners of one half this property, the ratio would be 8 per cent. Now, it must be stated that indirect taxes are not apportioned either according to the ability of the tax-payer or to the value of the property protected, but upon the opposite principle; they are apportioned so as to increase as his means of payment diminish, and they operate in an inverse ratio and with compound force in proportion to his poverty. The effect is, that the weight of taxation falls but lightly on the very wealthy or the privileged classes. The capitalist whose direct tax upon a million, at the rate of two per cent., would be twenty thousand dollars, pays, under the indirect system, but three thousand, if his consumption The writer is indebted to Mr. Alexander Delmar, editor of the Social Science Review, for the figures below, which are the result of elaborate computations and a careful analysis: Capital of the United States in 1860 Gross earnings of the entire people during the fiscal year 1860 $14,183,215,628 6,794,624,040 6,085,463,259 709,160,781 be twelve thousand dollars and the amount of taxation be equivalent to one fourth. The person of middle means, whose direct tax upon a thousand dollars' worth of property, at the rate of two per cent., would be twenty dollars, pays, under the indirect system, two hundred dollars, if his consumption be eight hundred. The poor man, whose direct tax upon a hundred dollars' worth of property, at the rate of two per cent., would be two dollars, pays, under the indirect system, one hundred dollars, if his consumption be four hundred dollars. If the middle and poor classes find their income insufficient to pay these indirect taxes and afford them the comforts of life, they must get along with the necessaries; if their income will not pay the indirect taxes and afford them the necessaries, they must go to the poorhouse or die of starvation. These considerations throw some light upon the following ominous statements in the statistical abstract of Great Britain presented to Parliament, in 1865. "Number of paupers, exclusive of vagrants, in England, Wales, and Scotland, for the year 1864, 1,129,573. Population, 23,891,009. With Ireland included, total number of paupers, 1,197,708. Total population, 29,995,343." The indirect system of taxation and the special exemptions and privileges which have been attached to classes of persons possessing large property, or holding high positions, have caused this pauperism; and the same causes will produce the same effects in this country, unless the people of middle and small means here, do what they would do in England if they had the right of suffrage, abolish for ever all special exemptions and privileges, and levy and raise the necessary revenues of the country by an equal apportionment upon all estates, real and personal, according to value. It is not the opinion of the writer of this report, that such a measure, requiring time and consideration to perfect its details, should be preceded by a total abandonment of the present revenue system; because the means of supporting the Government and providing for the national obligations, must continue to be obtained. But it is his opinion that the present system should be modified and ameliorated to the greatest possible extent, until one more just and perfect has been secured, by the adoption of the requisite constitutional amendment. It is for that reason that while he has most cheerfully agreed with his associates in reductions of taxation, recommended by the general report, and in modifications proposed, which cannot fail to be productive of good results, he has also agreed to the report as a whole, notwithstanding his preference for what he conceives to be a much better system. |