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TAXES TOLERABLE AND INTOLERABLE A long book devoted entirely to the history of
taxes seems unlikely to be a riveting read. But the author is a man who has spent most of his life as an expert on the subject and, furthermore, is against high taxation. At my time of life I find some amusement in reading a
sensible writer whose views are so far to the right of mine. And there was so much about taxes I didn't know that it became a pleasure to get the old synapses back into a learning mode. In "For Good and Evil"
Charles Adams writes from an American viewpoint, but his view extends five thousand years back, to ancient Egypt. However, his first illustration is a cartoon of a citizen walking through a doorway labelled "Internal
Revenue Service" with his hands held high above his head, and on his face a expression of resigned ambiguity. Resigned ambiguity, perhaps, is about right for the emotions with which we taxpayers mostly do our duty. It was
not always so. Much stronger feelings have been aroused. Adams reminds us that the Romans said "In any conflict between liberty and taxes, liberty will give ground." Adams even goes so far as to say that in ancient
times "life at all levels was first and foremost a tax struggle." I doubt if Mr. Adams has ever been to the Arctic. In ancient Egypt taxes were collected by the scribes who are depicted armed with staves and
using them to thrash defaulting farmers. It was the scribes who had assessed the taxes due, on the theoretical basis of what the land ought to be able to produce; so in a bad year the farmer not only went hungry but was soundly
beaten. The system lasted for thousands of years, perhaps because the scribe could reduce the taxes if he considered there was real hardship. Maybe, sometimes, he did. You will remember randy old King Solomon of Israel with his
thousand beautiful ladies and his alleged wisdom, not to speak of his gaudy glory. All that high living had to be paid for, and his taxation was merciless, described in the Bible as a yoke. When he died, to the relief of his
subjects who hoped for some ease in their taxes, he was succeeded by his son, Rehoboam. In the city of Shechem Rehoboam met the tribal leaders who requested some relief from Solomon's burdens. Rehoboam asked for three
days to think it over. Instead of the hoped-for relief he announced an increase in the rates and that he would enforce them, not with the ordinary whips used by his father but with scorpions, which were whips with metal spikes in
the lashes. On the spot a tax revolt broke out and the chief tax collector was stoned to death. Rehoboam fled, in his Rolls-Royce chariot, to Jerusalem, losing most of his kingdom except Judah. This admirable revolt against
intolerable taxation was only the first. Subsequent protests were made against the Assyrians and Babylonians for similar reasons over several centuries. The Jews generally got the worst of them except when Jerusalem, under siege by
Sennacherib, was saved by a plague of mice in the Assyrian camp. I doubt if those Assyrian warriors were frightened of a mouse or two. It seems more likely that the rodents were carrying plague. Should we remember the ancient Hebrews especially for their tax defiance?Henry VIII of England was a great spender of other people's money, but the English Parliament and
taxpayers were uncooperative. The English Catholic Church had become exceedingly rich, being tax-free itself and charging its members high fees for its professional services. Henry saw an opportunity and "softlee, softlee,
catchee monkey" he stole the whole shebang. It may be that he even plotted his own excommunication by the Pope. But even that splendid bit of barefaced robbery was not enough. He left his daughter, Elizabeth I, an empty
and indebted Treasury. He also left her many of his financially-enterprising genes. When some English ships piratically captured a Spanish man-of-war loaded with silver bars King Philip of Spain became distinctly irritated.
Elizabeth replied that she was informed that the silver belonged to some Italian bankers and that while she investigated the matter she would treat it as a loan. Philip replied with his Armada. This gave the Virgin Queen the chance
to seduce more taxes from her Parliament than had ever been voted before. As to who sent the Protestant Wind, the storm which blew the Armada all over the northern and western seas, neither Adams nor Leacock have any idea.
Elizabeth was (in my view purely by chance) brilliant on taxes. She reduced them, achieved a flourishing economy, fought a successful war and left a healthy Treasury. Modern supply-side economists say this shows the truth of their
theories. I would like to believe it. Meanwhile, in Spain and in France, savage taxation of poor people was ruining both countries. In France, believe it or not, the rich nobility were immune from taxes. The middle classes and
the peasantry were clobbered. Is it surprising that such a policy eventually led to the French Revolution and the guillotine? In Spain, at this time the centre of the wealthiest Empire the world has ever known, a taxation policy
was gradually strangling the country. The Muslims, when they controlled Spain had introduced the alcabala, a 10% tax on the transfer of anything, land, goods, personal property. What's wrong with that? After all we are
supposed to like our 15% VAT. The difference was that this was paid every time anything changed hands, so it mounted up: Farmer to wholesaler, 10%, wholesaler to retailer 10%, retailer to consumer 10%, and never a refund. So it
could easily get to 30%. What happened? Two bad things. Spanish goods were priced out of their own market; Spaniards got into the habit of cheating, smuggling, fiddling, bribing. And finally emigrating. And yes, to make it
worse, their nobility were also tax-exempt, as well as their Church. A secondary effect of all bad taxes (also defined as taxes which are resented by the people who pay them) is that it takes an army of non-productive
Government-paid consumers to collect them, and to ensure the hatred of the people for their government. Gibbon said the Roman state collapsed under the weight of its own bureaucracy. Same thing in Spain. Let's hope not in Barbados.
One of the taxes which has always been resented is that seductive invention of the English, the income tax. Even at 10% it was abhorred, but it beat Napoleon. In the US in 1916 the highest rate was 7% and the Treasury reported
206 people with million-dollar incomes. In 1921 the highest rate was 77% and only 21 million-dollar incomes were reported. Of every 10 million-dollar earners, 9 had disappeared. Not a good tax. Did the millionaires vote with their
feet or with their wits? But it is such a productive tax that I doubt if it will ever disappear. Especially when it is collected at source by those unpaid and usually honest tax-gatherers, the employers. Finally, a tribute to
a great tax-user. Cortes landed in Mexico with about fifty soldiers, some horses and some muskets. Soon he acquired an intelligent girl-friend who spoke the local lingo. But how could he conquer the great Aztec Empire with such a
tiny force? The local tribe were oppressed by heavy Aztec taxation which included not only corn but a supply of young men for religious purposes: namely to prevent the End of the World by bloodily losing their hearts to the
obsidian knives of Mexican priests. Do you wonder that the tax-oppressed became his reliable allies? |
