plete that failed to notice the estimates of the relative burden on taxpayers of direct and indirect taxation by persons well qualified by study, and administrative tax experience, to express an opinion.
It is not a matter of dispute that the cost of collecting direct taxes is, as a rule, much less than is the case with indirect taxes, and that of the receipt contingent on the former the largest proportion accrues to the Government. Thus in Prussia, where the administration of taxation may be characterized generally as despotic, the cost of raising revenue from direct taxes has been reported at four per cent and of indirect at twelve per cent. Under a direct tax system everybody knows how much he really pays, and if he votes for war or any other expensive national luxury, he does it with his eyes open to what it costs him. If all taxes were direct, taxation would be much more apparent than at present, and there would be a continuous popular demand, which at present there is not, for economy in public expenditures.
In England it has been estimated that for every fifty millions of indirect taxes paid into the exchequer, seventy millions are finally taken from consumers; and M. Guyot, late French Minister of Public Works, has recently shown by a series of statistical diagrams, that the octroi system of indirect taxation in France adds on an average twenty per cent to the cost of goods to consumers over and above the tax.[1] In New Zealand, where a comparatively small population and limited and definite sources of revenue have afforded extraordinary facilities for making an analysis, an expert has recently calculated that for every million and a half collected through the customs the people of that colony have paid not less than a million and two thirds.
In 1851 a committee of the Liverpool (England) Financial Reform Association published a statement, that a careful investigation instituted by it showed, that the difference between the net amount paid into the exchequer from indirect taxes and the gross amount taken through or in consequence of this system from the taxpayers, was not less than an average of thirty-seven per cent; and added that the evidence that had led to this conclusion "can neither be controverted as matter of fact, nor strengthened as a matter of argument."
In 1846 Hon. Robert J. Walker, then Secretary of the Treasury, in accordance with instructions from the United States Senate to report the extent to which the price of domestic products was enhanced by the then existing duties imposed on the import of
- ↑ It seems incredible, he is reported as graphically saying, "that Frenchmen, usually so sensitive to ridicule, can quietly submit to be 'sweated' and 'plucked' like fowls, without crying out against this antiquated method of indirect taxation only so long as they are kept blind to the tax."
