House-Tax. 1885-86. 1884-85. £20,557,819 £19,722,302 26,501,612 25,441,922 11,922,770 IS.247.312 11,886,185 11,600,614 1,867,377 2,900,150 1,023.196 7,898,911 8,162,651 1,739,586 1,745,056 483,306 477,820 FIFTY or sixty years ago, the taxation of this PUBLIC NET REVENUE THE LAST TWO YEARS. country was exceedingly oppressive; it came home to every one: the poor washerwoman Customs found the tax-gatherer's hand in her soapsuds; Excise the shoemaker on his leather; he worked with Income-Tax a taxed tallow dip, or by daylight which passed Stamps through taxed glass, all windows that could be dispensed with being blocked up; the exciseman was ubiquitous. Everything coming into this country had to pay a heavy customs duty. Even now there are some remains of this old state of taxation. A free and enlightened citizen who, in 1887, may wish to plaster his head with flour, must pay for the privilege; if he engage a man-servant, he must procure a licence; if he put him into a coat with a cat, lion, or tiger impressed upon the buttons, he must obtain another licence. It can therefore be easily imagined how oppressive taxation must have been when it clutched at every conceivable thing. Then, no one thought it any sin to cheat the revenue; on the contrary, to do so was considered meritorious rather than blameworthy: no guest, whatever his station in life, objected to drink brandy which his host assured the company had never paid duty to King George or to King William; in point of fact the liquor was thought better than any which the merchant could supply. No lady who went abroad returned empty-handed: gloves, French cambric, lace, and certain other things were in some mysterious manner secreted, and on the first opportunity shown to friends. Nor were the fair sex alone in this pursuit. The practice has not yet died out; few readers can honestly say that they have returned from their holiday trip without learning exactly how many cigars their cases will hold, or how much eau-de-Cologne may be passed. But, and this is very important, smuggling as an "honourable and praiseworthy" trade is dead; a professional smuggler or cheater of the revenue would very properly be denounced as a rogue. Totals........£88,063,055 £89,683,783 Under the head of Property and Income Tax the amounts stated give the approximate net produce under each schedule for 1885-86 compared with the preceding year : Mr. Huskisson was the first minister who expressed enlightened views on the subject of taxation, and Sir Robert Peel the first to put them in practice. With one stroke of the pen he cleared the tariff of several hundred items, and gave the death-blow to smuggling. In this he was followed by his pupil and lieutenant, Mr. Gladstone. Other Chancellors there have been, but they have mostly been conspicuous by their failures: it is not our business to mention names except in commendation; they will readily recur to the reader's mind; even now the country, or rather the unfairly taxed classes, are suffering from the blunder of one, who, not strong enough to carry his unpopular budget, contented himself by adding to the already heavy income-tax, letting off free the great mass of people who could and should contribute their quota of taxation. There is a grand opening for the present or for some future Chancellor of the Exchequer, strong enough to grapple with the present sources of revenue, to rectify its inconsistencies, and yet produce a larger result. It can be done. The gross amount of revenue collected in the year ending 31st March, 1886, was £92,135,296, but only £89,683,783 reached the national till, £2,451,512 being stopped on its way for repayments, allowances, discounts, bounties, etc. This compares favourably with the income of the year preceding, which was £88,063,055, or £1,620,728 less; the following are the items: The Income, or Property tax, in some form is a very old imposition; it was revived by Mr. Pitt in 1799 as a temporary war-tax, but it was not repealed till 1816. It was gradually raised to ten per cent., and in the year 1815 produced more than fifteen millions. The Whigs were bad financiers, and, under Lord Melbourne, were at their worst. "Retrenchment was one of their party cries, and to curry popularity they cut down tax after tax, and were in such low water that the Chancellor of the Exchequer was at his wits' ends, and being unable to devise anything better, adopted the expedient of adding an additional five per cent. all round to the existing taxation. To his astonishment he discovered that in political economy two and two do not always make four; the additional five per cent. was a failure. With scarce a regret the Ministry made way for Sir Robert Peel, and he, with Mr. Goulburn, soon put matters straight, the Income or Property tax being chiefly instrumental in this. The imposition of the tax in 1842 met with great opposition; but it has been found so useful by every succeeding ministry, that now it may probably be regarded as permanent. principle it is fair and just, but unfortunately it cannot be assessed with the same exactness as some other taxes. In 1855 it was raised to 18. 4d. in the pound. National Income and Expenditure. heavily upon beer and spirit drinkers, but as £8,403,580 Plate Dealers Spirits...... 13,140,694 Gun Refreshmt. Beer and House Cider.... 186,547 Rectifiers. Brewers 36,140 Spirit dealers Dog 343,133 Publicans & Armorial 76,234 Grocers.. Tobacco...... Male Srvnts. 137,294 Wines Game 177 ever, and assessing the amount upon the real value of the house, would be fairer than as it is levied at present. Of course any alteration of this kind, making no allowance to any class, would be productive of much grumbling; but it must be assumed that, if so assessed, the tax would be considerably reduced. £48,263 The receipts under the head of Post Office are 85.942 very satisfactory; under that of Telegraph less 26,595 80. Tradesmen on balancing their books, and 5,064 before dividing profits, are in the habit of 35,385 charging five per cent. "Interest on capital." Were the postal authorities to do this with telegraphs, it is to be feared that the returns would figure for something less than £1,745,000. The Parcel Post must at present be considered in its infancy. 6,835 4,166 119,669 1,474,381 85,301 67,934 184,958 Other........ 9,096 The fourth section of Income, Stamps, &c., is more open to objection, especially the death duties, which alone produced the large amount of nearly seven and a half millions last year. Lord John Russell had no sympathy with the man who having had a legacy of £50,000, grumbled at the tax, £5,000 being deducted; many who have received smaller sums have not been in such a happy state of mind. The new "Corporation" Duty has not been so productive as was hoped by its proposer. The small sum of £133 15. od. was received for "Bankers' Notes," and of this £36 178. 6d. was deducted, so that only £96 178. 6d. reached the Exchequer; apparently it would be better to abolish the duty. The simple Penny Receipt Stamp produced nearly a million; that on silver and plate £51,763, and of this the makers deducted £6,760 for drawbacks, so that the net amount was only £45,000. With silver at 48. 2d. an oz. the duty of 18. 6d. is absurd. If taken off, and a merely nominal duty, little more than the cost of testing the quality or fineness and stamping the article, say 2d, or 3d. an ounce, and no drawback whatever allowed, the demand for silver goods would be enormous; no couple,however poor, would think of marrying till they had procured their half-dozen standard silver spoons; these are like so much money, and the accommodating" Uncle" will always lend something on the spoons when deposited with him. The gross sum received represents a payment upon about 690,000 ounces; in 1840 the duty was paid upon 1,270,000 ounces. The items under this head are: Woods, Forests, and Land Revenue produce £380,000. There is one satisfactory item, a payment of £32,561 on account of the Sardinian Loan; and the interest on purchase-money of Suez Canal shares received from the Egyptian Government amounted to £377,776. The other sources of revenue are too many to enumerate; one, however, may be mentioned, viz., that received from persons who remitted it to the Chancellor of the Exchequer for "conscience' sake," £6,565 178. 8d. Of the National Expenditure nothing need here be said beyond presenting the various chief items, which are: CIVIL SERVICES: 9,451,000 250,000 150,000 £39.538.593 Public Works and Buildings. £1,766,717 124,010 Salaries and Expenses.. 2,442,862 Legacy 15,852 Law and Justice... 6,235,979 Succession 858,240 Gold Plate. 22,310 Education, Science, and Art.. 5,268,451 Silver Plate 45,002 Foreign and Colonial Services 673,087 153,164 Non-effective and Charitable... 1,212,362 Deeds 1,800,000 Medicines .. 178,718 Miscellaneous 96,305 Marriage portion of H.R.H. Prin- 30,000 £17,725,763 change Receipts & id.Stmps. Land Tax and House Tax between them produce about £2,900,000. The Land Tax can hardly be remitted: it would be unfair to those who have already redeemed it; but the House Tax is capable of some improvement. Like several ther taxes, it may be that a reduction of the tax, allowing no exceptions or variations what Total Cost of Civil Services Note.-The Pension List for 1896 is relieved of pay. ments of "persons who suffered by the Rebellion in Ireland in 1798," the last two pensioners having died in 1885. Pensions to the last of the servants of Her late Majesty Queen Charlotte also ceased in 1885, but there are still seven surviving pensions "formerly on the Civil List of George III.," who died in 1820. On the first of January, 1816, the National Debt amounted to £885,186,323, and the Annual Charge was £32,457,141. On the 5th of April, 1885, the Debt was reduced to £742,282,411, and the Charge to £21,858,615. In 1816, the population of the United Kingdom numbered 19,520,488, and in 1885, 36,331,119. In 1816 the amount of Debt per head was £45 68., and in 1885 but £20 58. The total amount was actually larger than the sum given above; but by adopting the present method of capitalizing the Annuities then outstanding as three per cent. stock, the following figures will represent the state of the Debt on the 5th of January, 1815. Reckoned in this manner it stood as follows:Funded Debt Unfunded Debt Terminable Annuities capitalized 39,397,000 £816,312,000 44,727,000 £900,436,000 This large amount of Debt was the growth of many years, and nearly all had been raised for foreign wars. There was a trifling amount (L664,263) due when the glorious revolution" of 1688 brought over the Dutch King William to save the country from Popery and other evils, but in carrying out this project he succeeded in adding to the Debt nearly sixteen millions during the twelve years of his reign. Under Queen Anne, Marlborough added to the glories of the country, and helped to swell the Debt, which at the time of the Queen's death had increased by nearly thirty-eight millions. Under the first George the Debt decreased slightly, but George the Second came to its rescue, and left the country nearly eighty-seven millions worse off than he found it. During the first twelve years of George III. the Debt was again reduced by about ten millions, and at the time of the revolt of the American Colonies it was under one hundred and thirty millions, an amount which frightened all the political economists of that day. Undismayed at this, the obstinate king and his weak ministers pressed on the war, "entirely regardless of expense." The bill was a heavy one, and added one hundred and twentyone millions more to the permanent Debt. On the conclusion of the disastrous war, which had all along been unpopular, there was a considerable outcry at the waste, and some efforts were made to reduce the amount, and in the nine years from 1784 to 1793, ten and a half millions were paid off; no less than £2,421,681 being paid off in 1792. The French revolutionary war began in 1793, and with a short interval of exhaustion, called "Peace," lasted till 1815, when Bonaparte was sent to St. Helena, and the forty years' real peace every commenced. During these twenty-three years of war, money was borrowed in the most extravagant manner. From 1793 to 18or the average cost of £100 three per cent. Stock was £57 178. 6d., and from 1803 to the conclusion of the War, L60 178. 6d. Had the government adopted an opposite plan, and for hundred pounds borrowed received the whole amount, paying five or six or even seven per cent., the gross indebtedness of the country on the termination of the War would have been several hundred millions less, and the high rate of interest could have been gradually reduced. Such, however, was the imbecility of ministers, that in 1798 they raised a loan of £3,000,000, at the rate of L200 three per cent. Stock and 58. long annuity for every hundred pounds borrowed. Another instance may be mentioned. In 1815, a loan of £36,000,000 was negotiated, every subscriber receiving £174 three per cent. Stock, and £10 four per cent. With loans negotiated on such terms it is easy to understand how rapidly the Debt accumulated. The following loans were raised from 1793 to 1816: Year. Year. £ Year. £ 1793 4,877,956 1801 27,305,271 1809 12,298,375 1794 6,998,389 1802 14,638,254 1810 7,792,444 1795 30,464,831 1803 8,752,761 1811 19,143,953 1796 22,244,982 1804 14,570,763 1812 24,790,697 1797 30,356,873 1805 16,649,801 1813 39,649,282 1798 16,858,503 1806 13,035.344 1814 34,563,603 1807 10,432,934 1799 21,714,863 1815 20,241,807 1800 23,030,529 1808 12,095,044 1816 514,059 £ With the return of peace efforts were made to reduce the Debt; but this was no easy matter. In 1813, the National expenditure had reached the unprecedented amount of £108,397,645, of which £68,748,363 was raised by taxation, and £39,640,282 by loans. In 1815, the Waterloo year, the amount raised by taxation had increased to £72,210,512; but in 1817, the War being finished, taxation was reduced to £52,055,913, and out of this the sum of £1,826,814 was applied to the reduction of Debt. The following amounts were paid off from 1817 to 1838, when for a time the payments ceased :Year. £ Year. £ 1817 1,826,814 1824 7,456,559 1818 1,624,606 1825 9,900,725 1819 3,163,130 1826 1,195,531 1821 4,104,457 1820 1,918,019 1827 2,023,028 1822 2,962,564 1823 5,261,725 Year. £ 1832 5,696 1833 1,023.784 1834 1,776.378 1835 1,270,050 1828 4,667,965 1829 2,760,003 1830 1,935,465 1831 2,673,858 1836 1,590,727 1837 1,985,885 1838 7,496 Large amounts have since been paid off, and on the 5th of April, 1886, the total outstanding was estimated at £711,788,232. The National Debt. The Debt is of three descriptions:-I. Funded; II. Terminable Annuities; III. Unfunded:— 1-THE FUNDED, OR PERMANENT, DEBT. That is, Debt which the government is not ander obligation to pay off at any fixed time. It is represented at present by Consols, reduced three per cents., new three per cents., two and a Laif and two and three quarters per cents., and some minor stocks. Amount of 21⁄2 per cent. Stock...... £32,810,520 33 33 234 per cent... 3 per cent. Consols 179 of the twenty years the payment of this sum ceases, and the result of the transaction is that the debt has been then bond fide reduced by £1,000. The plain meaning of the transaction is, of course, that the Treasury binds itself to pay off a certain portion of principal every year for a given number of years. At the end of the time the principal is paid off, and the Debt is correspondingly reduced. of course necessary to ascertain the capital When the capital of the Debt is computed it is value of these terminable Annuities. For this 418,300 purpose the Government actuary calculates 4,647,799 the amount of three per cent. stock equivalent 329,896,856 in value to the terminable Annuities. In 3 per cent. Reduced Ann. 77,151,474 making this calculation a price has to be 3 per cent. New Annuities 180,053,129 assumed for 3 per cent. stock, and it has been 32 per cent. New Annuities 225.746 Bank of England 3 percent. 11,015,100 a matter of discussion among experts what Bank of Ireland 3 per cent. 2,630,769 laid before Parliament do not always exactly that price should be, and thence the returns correspond. The variation, however, is not so £638,849,693 great as seriously to affect the comparisons of the immense sums involved in a statement of the Debt. II. TERMINABLE ANNUITIES. These are sums paid for a certain number of years, and then terminating altogether. As these Annuities are the chief instrument by means of which the debt is reduced, it may be shortly explained that under various Acts of Parliament, and under varying conditions, the Treasury is empowered to give an Annuity for a certain number of years in exchange for permanent stock. Thus A transfers to the Treasury £1,000 of 3 per cent. stock on which he has been receiving £30 a year; the Treasury in return undertakes to pay A £60 a year for twenty years or thereabouts. The Treasury cancels the 1,000 stock, and thus reduces, say, Consols by that amount; but during twenty years it pays a much larger sum than it would have paid if it had left matters alone. At the end The following Table exhibits the variation in amounts of the Funded and Unfunded Debts, with the capitalized value of Annuities computed as Three per Cent. Stock from 1861 to the present time. The total amount of the Terminable Annuity Debt, 31st March, 1886, at its capitalized value, was £85,829,917. III.-UNFUNDED DEBT. The Unfunded Debt consists of loans which the Government is bound to pay off at certain dates, and is represented by Exchequer bills, Exchequer bonds, and Treasury bills. These loans have currency for periods varying from a few months to five or more years. The amount outstanding 31st March, 1886, was £17,602,800. The Consolidated Fund is also liable for claims on account of unclaimed dividends, balances in the Court of Chancery, &c., amounting to between four and five million pounds. COST OF INTEREST AND MANAGEMENT OF THE £ £ £ 785,119,606 16,686,000 | 18,947,740 784,252,338 19,517,900 19,388,876 1363 783,306,739 16,495,400 20,716,727 1864 1864 777,429,224 13,136,000 26,442,428 1865 775,768,295 10,742,500 25,408,370 1866 8,187,700 25,435,034 1867 7,956,800 27,521,513 1868 7,911,100 56,816,803 1869 1866 773,313,229 1857 769,541,004 1868 741,190,328 1869 740,418,032 1870 740,789,548 £ 1865 23,611,437 2,340,522 410,532 26,362,491 23,534,805 2,361,894 329,682 26,226,381 8,896,100 55,471,424 1870 22,427,854 | 4,365,848 252,951 27,046,653 22,255,060 4,378,737 192,640 26,826,437 170,556 26,840,214 1873 22,136,393 4,539,547 1875 21,780,028 5,173,654 140,797 27,094,479 1971 731,309,237 6,091,000 57.969,885 1872 22,156,952 4,512,706 619,581 27,400,000 944,087 27,700,000 1,076,614 28,000,000 980,717 28,000,000 986,572 28,000,000 661,548 28,800,000 583,798 28,961,836 Average Price of Consols for the Past Hundred Years, WITH THE AMOUNT OF INTEREST PRODUCED. BANK OF ENGLAND MINIMUM RATE OF DISCOUNT, 1871 TO 1885. MONTHS. 1871. 1872. 1873. 1874. 1875. 1876. 1877. 1878. 1879. 1880. 1881. 1882. 1883. 1884. 1885. 4% 3 314 31 Average 24 4% 4% 33% 2% 2% 3% 23% 24 32 48 31% 28 3 For the fluctuations in the rate in 1886, see "Remarkable Occurrences, &c." |