recommended, as instruments for redressing inequality in the distribution of wealth. The special taxation of unearned incomes is the simplest plan of distributing the landlord's rent among the people who create it.

Death Duties.

The restoration of the national property to the community can be materially assisted by means of death duties. The fundamental principle of the limitation of the right of bequest by the taxation of property changing hands at death needs no justification. It has been recognised as a legitimate source of revenue for the last three hundred years. In 1694 there was a fixed payment of 5s. in the case of every estate over the value of £20, which four years later was increased to 10s. In 1779 an ad valorem scale was first introduced.

Drastic reform is, however, required to make the present death duties equitable. For, notwithstanding the fact that the commercial classes, as distinct from the landed gentry, have had the political power in their own hands for fifty years, the landlords have managed to keep the tax on land down to the lowest possible point. There are now five death duties going by the names of Probate, Account, Legacy, Succession, and Estate duties. Personal property is charged with Probate or Account duty varying from 2 to 3 per cent. Land pays Succession duty only. The Estate duty is payable upon both real and personal property. An estate consisting of £15,000 in personal property, and descending to lineal descendants, pays £600 in death duties; but if the property be land, the Succession duty only amounts to £189 where one successor inherits the whole, or to £93 if two successors inherit in equal shares.

Legacy duty is charged on the full value of personal property, and has to be paid at once. Succession duty is only charged on the life-interest of the successor: thus, on an estate of the capital value of £10,000, and producing £300 after payment of all outgoings, if the successor be 4 years old, duty will be charged on a capital value of £5,786 8s.; if 21, on £5,159 11s.; if 40, on £4,462 10s. ; if 50, on £3,728 18s. 6d.; if 70, on £2,032 7s.; if 90, on £400 7s. In the case of personalty, the Legacy duty would in all these cases be charged on the full £10,000. Above all, the payment of Succession duty is spread over 4 years. If a second death occurs before the expiration of that time there is a loss to the revenue of the unpaid instalments.

Graduated Death Duties.

All the anomalies of the present death duties must be swept away, and a simple duty applicable equally in cases both of real and personal property must be substituted, and must in every instance be levied upon the capital value of the property. The principle of graduation should be introduced. Estates under the value of £500 should be subject to a nominal tax, if not absolutely exempted; and the relationship of the deceased and the beneficiaries should be dis

regarded. All property left to the nation or to any national institution should be free, and the existing exemption of the Royal family abolished.

At the present time the different methods of collecting the Probate, Legacy and Succession duties make it difficult to estimate the immediate financial result of their unification. The unified duty might therefore be collected for one year, after which the graduated scale might be introduced.

As a preliminary measure, the present death duties should at once be trebled. The revenue from this source would then be £22,500,000.

Property and Income Tax.

This tax, which is generally called simply the Income Tax, was first imposed in 1798 at the instance of Mr. Pitt, as an "aid and contribution" for the prosecution of the war with Napoleon Bonaparte. In the following year a duty on incomes was imposed at the rate of 10 per cent. All persons were required to make returns of the whole of their income from all sources; exemption was granted to all whose incomes were under £60 a year, and was graduated above that amount. In 1816 the tax was dropped, and not revived until 1842, when Sir Robert Peel reimposed it, not as a war tax, but as a means of meeting a deficit, and in order to afford some relief to the manufacturing industry. Though it is one of the most equitable taxes in existence, it is surrounded by so many vexatious red-tape regulations and accompanied by so much official inquiry into private affairs, that it is perhaps one of the most unpopular, and the most evaded. Although in its present application it contravenes the principle of equality of sacrifice, it may easily be brought into complete harmony with it.

It is now assessed under various heads or schedules :

A. Lands, tenements, hereditaments, payable by the owner.
B. Occupation of lands.

C. Annuities, dividends, etc.

D. Trades, professions, employments, etc.

E. Public Offices, salaries, pensions, etc.

All incomes of under £150 a year are exempt; and from £150 to £400 an allowance is made in respect of £120.

The Income Tax now brings in £13,000,000. The first Income Tax brought in £750,000 for every 1d., whereas now 1d. produces £2,200,000.

Taxation of Unearned Incomes.

The principle of equality of sacrifice demands that the income tax should be graduated and differentiated. A distinction must be made between those incomes that are earned and those that are unearned, between workers and idlers, poor and rich. "On the whole," said Mr. Goschen in 1889, "I think it will be generally

recognized that it is the men whose fortunes are considerable who pay least in proportion to their aggregate income and property." This disproportion must be remedied.

A fair margin of income, say £400, should be exempted in accordance with the principle already adopted, and the practice of allowing the deduction of life insurance premiums should be continued.

The most feasible method of graduating the tax, and one which would remove the necessity for an elaborate system of repayments, would be an extension of the present abatement. From all incomes proved to depend for their continuance upon the continued personal labor, in any form, of the recipient, an abatement of one-third might be allowed. From the incomes received by persons whose total incomes from every source do not amount to £1,000 per annum, a further abatement of one-third might be allowed. Thus a person receiving £500 per annum from his own exertions would be entitled. to an abatement of one-third in respect of the source of his income, and of another one-third in respect of its amount. If the tax, now 6d., were fixed at 1s. 6d. in the £ to begin with, he would pay no more than at present. A man having an unearned income of £900 per annum from investments would now pay £22 10s. as income tax. while under the proposed new tax, being entitled to deduct £300 for an income under £1,000, he would pay £45. A man in receipt of £10,000 from investments would be taxed £750 instead of £250.

What the Budget Ought to Be.

Whilst it is impossible to transform at one blow a system of taxation that is the growth of centuries, removing every anomaly and inaugurating a new financial era, it is quite feasible to make at once some sweeping alterations both in the incidence of taxation, the methods of collection; and the manner and purposes of expenditure; so that the burden now breaking the back of the workers may be shifted on to the broad shoulders of the landlord and capitalist.

The key-note of a Socialist Budget would be the taxation of property and the exemption of labor. Rent and interest would be the sources of revenue for current expenses; and the taxation imposed upon them would be avowedly directed to aid in the recovery of the land and capital for the people. Abnormal salaries and profits should be placed on the same footing as rent and interest. A Socialist Chancellor of the Exchequer in devising new taxes would not only take into account the necessity of providing for the ordinary expenses of the public administration, but would specially consider the efficiency of his proposals in restoring to the common purse some of the national wealth which now annually finds its way into private pockets. Consequently, his first move would be to abolish all those taxes which are not consistent with this general principle.

The following changes are the least which we ought to expect from the very first Budget of a really popular Government :—

Abolition of all Customs and Excise Duties on the of Food the People, and on Tobacco.

Abolition of all Fees and Stamps on Licences for Employ

ment.

Abolition of the present Land Tax and House Duty, in order to make way for more effective measures.

Reduction of postage rates and increase of pay to postal workers, so as to absorb the present illegitimate postal profits.

These reductions would cause a loss of revenue of about £21,000,000. To meet this, we should require to have :—

The Death Duties simplified, consolidated, graduated, and. trebled in total yield.

The Income Tax graduated, differentiated, and trebled in nominal rate, but with complete exemption for incomes. not exceeding £400.

These two changes would yield about £27,000,000 more revenue, making a nett gain of over £6,000,000, which would not only enablethe immediate enactment of

Payment of all Members of the House of Commons, but with the addition of our present expenditure of more than £10,000,000 on Poor Law relief, would go far to make it possible to substitute Universal Pensions to the aged and infirm for the work. house and the parish dole.

The First Step towards Taxation Reform.

The great obstacle in the way of taxation reform is the composition of the House of Commons, which votes the taxes, and which at present consists mainly of landlords and capitalists. As long as the wealthy classes possess a practical monopoly of Parliamentary representation, no really thorough-going measures for the readjustment of the taxes will be carried. Until laws are passed for the PAYMENT OF MEMBERS, and of their election expenses, it will be impossible for the workers to send to the House of Commons men who are not pecuniarily interested in exempting property from taxation at the expense of labor. No Parliamentary candidate should be supported who will not pledge himself to vote for this elementary reform. Insist on a pledge to press for

Payment of All Members of the House of Commons on the very First Budget.

G. STANDRING, Printer, 7 & 9 Finsbury Street, London, E.C.