Functional socialism

TAXATION 71

(3) Taxes should be levied at the time it is most convenient for the contributor to pay them.

(4) A tax must be so paid as to take out and keep out of the payers’ pockets the least possible amount over the net return to the Treasury. In other words, a tax that costs too much to collect is a bad tax. This is obviously the exact opposite to the Chinese “squeeze”; but it was really directed against the farming of taxes.

We must not delve into the unending controversy upon direct and indirect taxation. Those who are interested will find it in Mill. Adam Smith’s maxims were generally accepted down to 1914, when the war left douleversé all our preconceived principles and predilections.

From the Victorian period two facts emerged. First, that taxation was based on the individual; but, secondly, however much in theory the State considered the individual as the unit of taxation, aiming at personal equity, the practical best to be attained was by taxing classes in the aggregate. The problem was to determine what kind of tax presses least hardly on the different classes known to society (the wageearner haying little or no status in this connection) whilst in the case of a tax or impost laid impartially on all, the burden was eased by graduation, abatement, proportionate percentage, or some other equitable adjustment. Gladstone, for example, in renewing the income tax, in 1860, exempted all incomes below £100 (thereby excluding the vast majority of the wage-earners) and taxed higher incomes on the