ment of a Select Committee "to inquire into the present mode of authorizing and collecting the income and property tax, and whether any mode of levying the same, so as to render the tax more equitable, can be adopted." An interesting glimpse into Mr. Gladstone's attitude on the question of permanence is afforded by his speech of that date. "Necessity," said Gladstone, "drove us to it in 1842, and necessity has attached us to the use of it." And when he was interrupted by cries of "no! no!" he added: "When I used the word ' attached' I meant not as a bridegroom is attached to his bride, but as a captive is attached to the car of his conqueror."

The spell of Gladstone's eloquence in 1853 had not only ' converted parliament, but had silenced for a time all discussion. The only exception was the republication, with a new preface, of the speech for a graduated income tax which Buckingham had delivered in 1833.2 Toward the end of the fifties, however, the discussion was resumed, and the movement for reform soon acquired considerable momentum. In 1858 the Birmingham Income Tax Reform Association was formed, for the purpose of "removing the injustice and oppression which are goading the tax-paying classes into a state. of discontent and disaffection."3 They objected to the tax as "a violation of the principles of free trade," and demanded not only the adoption of the system of capitalization, but also the acceptance of that of self-assessment. “As to industrial incomes, let every man make his return, which shall be final, under the sanction of an oath or solemn declaration. Thus inquisitorial powers, and the secret tribunal, would be got rid of." 5

1 Debate in the House of Commons on the Gradual Extinction of the National Debt, and of the true Principles of a Property and Income Tax. Republished for comparison with Gladstone's Financial Proposition. [By J. S. Buckingham.] London, 1853. Cf. also Some Observations on Direct Taxation in reference to Commercial Reform. By S. Coleman. London, 1853.

2 Supra, p. 121.

8 Address of the Income Tax Reform Association. Birmingham, 1855, P. 3. 6. 5 Op. cit., p. 12.

4 Op. cit., p.

Two years later the Committee issued a forcible address, declaring themselves "uncompromising opponents of the present income tax laws because those laws are unjust in principle, inequitable in application, and oppressive in operation."1 Schedule D was naturally the chief subject of their objurgations, and they concluded that "a tax that outrages justice alike in principle and in operation, will be abolished by your fiat in spite of any ministry."2 A similar association formed in London issued an address in the same year, protesting against the continuance and increase of the tax and complaining of the "stealthy" proceedings of the government. An amusing dialogue on the income tax which appeared at about the same time states that "an income tax, levied as at present, is a graduated property tax, the graduation of taxation being so contrived as to fall with crushing weight on the shoulders of industry, to the relief of accumulated wealth."4 The author of a diffuse treatise on taxation known as The People's Blue Book,5 was invincibly opposed to the continuance of the tax. "It is manifestly an impossibility," he tells us, "ever to impose a tax on incomes, necessarily uncertain in amount and precarious in termination, which will not be unequal and unjust, and in direct violation of every rule and maxim which should govern taxation."6 His remedy was a tax on realized property combined with a "tax on persons" through the medium of a house tax. The same plan was approved, with a few modifications, by the author of a tract, who signed himself a mill-owner.

Stans

1 Address of the Birmingham Income Tax Reform Association to the Electors of Great Britain and Ireland, Feb. 1857. Birmingham, n. d. [1857], p. 3.

2 Op. cit., p. 10.

3 The Property and Income Tax Association to the Taxpayers of the United Kingdom. London, n. d. [1857], p. 5.

The Shade of Cocker and the Chancellor of the Exchequer. A Dialogue on the Income Tax. London, n. d. [c. 1858], p. 8.

5 For the full title see above, page 145.

6 Op. cit., p. 346 of the ed. of 1872.

* Taxation: Gross Injustice of the present System. Direct Taxation the true Remedy. By a Mill Owner. Edinburgh, 1859, p. 17.

feld preferred a property tax to an income tax on the ground that "money may be considered as the honey of a society, and from its accumulated stores and deposits, and not from the working bees returning to their hives with laden limbs against the adverse winds should the chief contributions for the support of the State be taken: To starve the bees and spare the drones is bad policy, even for the drones themselves." Gibbon repeated his uncompromising opposition to the income tax, and declared his preference for taxation on expenditure, basing his opinion on an old and long exploded fallacy. "Taxes upon income, however modified in the imposition of them, can never be incident so fairly and impartially as taxes upon expenditure or consumption. Taxes upon income are compulsory contributions - while taxes upon expenditure or consumption are, in a very great measure, optional contributions." 2

Other writers were willing to accept the income tax, provided the principle of discrimination might be adopted. Thus the Liverpool Financial Reform Association confessed that there were defects in the tax, but contended that with all its faults it was preferable to indirect taxation. Referring to the anti-income-tax agitation, they said: "Fully endorsing your catalogue of grievances, and having reminded you of others which seem to have been very generally forgotten, we are not at all surprised that you should be indignant and disgusted at and with the income and property tax, as it is at present assessed and levied; but we think, nevertheless, that a little

1 Outline of a System of Direct Taxation for superseding Customs and Excise Duties, and establishing perfect Freedom of Trade. By Hamer Stansfeld. London, n. d. [1859], p. 9. The metaphor, it will be seen, is the same as that used in 1907 by Andrew Carnegie in opposing the federal income tax in the United States. Cf. his speech before the National Civic Federation at the annual meeting in December, 1907.

2 The Income Tax; its Causes and Incidence: showing by Analysis that it is a Land Tax, a House Tax, a Tax upon Commodities and a Repudiation of Public Debt. By Alexander Gibbon. London, 1860, p. 21. Gibbon declares, in an explanatory note, that this tract is only a reprint of a part of his book of 1851.

serious reflection will suffice to convince you that the remedy you seek will be very much worse than the diseases of which you complain." Browning stated that "judging from the readiness with which it has been received by the nation, it may be assumed that, although much clamour was made for the repeal of the war portion of it, generally speaking, a tax on income is favourably viewed by a large majority."2 He thought that discrimination would remove whatever objections remained. Hubbard, who lost no opportunity of harping on his own idea, delivered a lecture in which he claimed that “a property tax, as it is now levied, is an odious thing." Professor Levi wrote a treatise in which he stated that "the injustice of taxing all kinds of income at equal rates will be best appreciated when we consider the saleable value of different kinds of property."4

The

1 Address on the Present Anti-Income Tax Agitation: showing how and why Direct Taxation is preferable to Customs and Excise Duties. By the Liverpool Financial Reform Association. New Series, no. 19. Liverpool, 1856, p. 5. Numerous essays were published either by, or under the auspices of, the Association, all emphasizing the same point. Cf. the following: Direct and Indirect Taxation contrasted; or the immeasurably Preferable Policy of an Income Tax to Customs and Excise Duties, elucidated. By Lawrence Heyworth. n. d. [1861]; Taxation: Direct or Indirect. An Essay intended to be read to the Economic Section of the British Association. By Francis Boult. Liverpool, 1861; Rights of Rich and Poor: Just Taxation; Abolition of all Duties on the Necessaries of Life, etc. By George Henry Smith. Liverpool, n. d. [1861]; Essay on Taxation, Direct and Indirect, with Suggestions for its Revision. By Thomas Clarke. Liverpool, 1851. Cf. also the Scotch pamphlet, Indirect Taxation: Its Wasteful and Burdensome Nature, as compared with Direct Taxation, in necessarily causing the Public to pay much more than the Amount imposed by Parliament; and the most Equitable Mode of imposing Direct Taxes on Property. By Duncan M'Laren. Edinburgh, 1860. For a later pamphlet by the same author see infra, page 164.

2 The Finances of Great Britain considered. Comprising an Examination of the Property and Income Tax, and Succession Duty Act of 1853. By Reuben Browning. Part I, London, 1859, p. 11.

3A Lecture on Currency, Taxation, and Finance, delivered at the Town Hall, Buckingham, on the 21st of April. By John Gellibrand Hubbard. n. d. [1859]

p. 22.

On Taxation: How it is Raised, and how it is Expended. By Leone Levi, London, 1860, p. 153. The substance of this was published in a paper, “On the Distribution and Productiveness of Taxes with reference to the Prospective

Professor Neate contended that the principle of differentiation flowed naturally from the theory of benefits in taxation, although he conceded that "it may not be easy, and may possibly be impracticable, to estimate in money the value of that difference." On the other hand, Dr. Booth in an address before the British Association opposed discrimination chiefly on the ground that if the tax were perpetual, perpetual incomes would pay their share. This was in effect the argument of Warburton before the committee of 1852, and an attempt to refute it was made by Sargant, in an address in which he declared himself strongly in favor of the principle of differentiation. It is evident, therefore, that there was a widespread interest in the matter which formed the subject of Hubbard's committee.

§8. The Committee of 1861

The Committee comprised, in addition to the chairman, Mr. Hubbard, such men as the Chancellor of the Exchequer, Mr. Lowe and Sir Stafford Northcote. Among the chief witnesses were Hubbard himself, Newmarch, Farr, and Mill, all of whom agreed with the chairman. Hubbard presented a memorandum in which he made a classification of "propertyincomes" as compared to "industrial incomes." Inciden

Ameliorations in the Public Revenue of the United Kingdom," in the Journal of the Statistical Society, vol. xxiii (1860), pp. 37–65, and separately reprinted.

1 Three Lectures on Taxation, especially that of Land, delivered at Oxford in the year 1860. By Charles Neate. Oxford, 1861, p. 19.

2" On the Principles of an Income Tax." in Journal of the Statistical Society, vol. xxiii (1860), p. 456. Booth also opposed the scheme of the Liverpool Financial Reform Association. Ibid., p. 461.

3 William Lucas Sargant, "Some Observations on the Fallacy of the Warburton Argument in favor of an indiscriminating Income Tax," in Journal of the Statistical Society, vol. xxiv (1861), p. 213.

4 Report from the Select Committee on Income and Property Tax; together with the Proceedings of the Committee, Minutes of Evidence, and Appendix. 1861, 302 +51 pp.

5 In the first class he included all of Schedule A (lands, houses, rent-charges, mines, quarries, manors, fisheries, and public companies like railroads, canal, gas, and dock companies), except incomes from mining adventures; all of Schedule C

M