poor. All classes pay indirect taxation: the middle and wealthy pay direct; but indirect taxes press much more seriously on the laboring population."
An instructive comparison of the method and influence of direct and indirect taxation may be instituted by supposing the two systems to be put into practical operation under similar circumstances, for effecting a purpose which all are willing to admit is most desirable or necessary. For example, a town meeting is held to provide means for building a bridge. The direct and honest way would be to assess and levy an equitable tax, adequate to provide for the proposed expenditure, on the property of the citizens of the town. An indirect way, as exemplified by the tariff (omitting the complicated machinery for appraising merchandise), would be to provide that the storekeepers of the town should charge, on account of the proposed expenditure, an excess over general prices to the extent of two cents a pound on sugar, twenty-five cents more per yard on woolen cloth, five cents more for each tin pail or cup, and, keeping an account, return the results of the extra prices paid on the above-mentioned and other like commodities by their consumers, to the town treasury. Would it not be evident that under such a method of procedure the wealth of the town would in a great degree escape taxation for the construction of the bridge, and that its expense and burden would fall mainly upon the poor; inasmuch as the average amount of consumption of sugar, cloth, and tin by the citizens of the town, and the average per capita taxation contingent on the same, would have no just or uniform relation to their ability to pay for the same? A man with ten thousand a year income will not probably consume ten times as much sugar as one with one thousand a year.
In the case of imported commodities charged with import duties, not only is the price of the imported commodity enhanced directly by the duty, but the price of a much larger quantity of competing product of domestic origin is increased to approximately the same extent. Thus, in the case of iron and steel, the average difference in the prices of these commodities in England and the United States during the ten years from 1878 to 1887 inclusive, occasioned by the imposition of indirect customs taxes by the latter country on such a comparatively small proportion of its domestic consumption as was imported, increased the cost of the total consumption of these products in the United States during the period mentioned, to the extent of at least $550,000,000. Such an increase represented an average of $55,000,000 per annum in excess of the cost of a like quantity to consumers in Great Britain during the same period; an aggregate, according to the census data of 1880, in excess of the entire capital invested in the
