Riches and Poverty (1910)

by L. G. Chiozza Money

In their twenty-eighth report (1885) the Commissioners of Inland Revenue, in giving a detailed description of the Land-Tax of 1692, point out that the impost "was in fact a Property and Income Tax, and moreover that personal estate was quite as much the object of the charge as land." So few people are aware of these facts that it may be well to set out the actual provisions of the Act, as described by the Commissioners:

It (the Act of 1692) is entitled "An Act for granting to their Majesties an aid of four shillings in the pound for one year for carrying on a vigorous war against France"; and the second section enacts, "That every person, body politic and corporate, etc., having any estate in ready monies or in any debts owing to them or having any estate in goods, wares, merchandise, or other chattels, or personal estate whatsoever within this realm or without shall pay yield and pay unto their Majesties four shillings in the pound according to the true yearly value thereof; that is to say, for every hundred pounds of such ready money and debts, and for every hundred pounds' worth of such goods, wares, etc., or other personal estate the sum of four and twenty shillings."

The third section imposes a duty of four shillings in the pound upon the profits and salaries of all persons having any office or employment of profit (except naval and military officers).

And then the fourth section proceeds thus, "And to the end a further aid and supply for their Majesties' occasions may be raised by a charge upon all lands, tenements, and hereditaments with as much equality and indifferency as is possible by an equal pound rate of four shillings for every twenty shillings of the true yearly value, be it enacted that all manors, messuages, lands and tenements, and all quarries, mines, etc., tithes, tolls, etc., and all hereditaments, of what nature soever they be, shall be charged with the sum of four shillings for every twenty shillings of the full yearly value."

The rules for assessments follow the same order, and show that the charge on personal estate was as much to be attended to as that on land. Thus the assessors are directed in the first place to bring in certificates of the names of every person dwelling within their districts, "and of the substance and values of them in ready money, goods, chattels, and other personal estate." Every person is to be rated for personal estate at the place where he shall reside, and, if not a householder, at the place where he resides at the execution of the Act, or if out of the realm, where he was last resident; "and for the better discovery of personal estates," every householder is to give an account of his lodgers.

But although the Act of 1692 was the first of those so-called Land-Tax Acts, it was not until 1697 that the tax was imposed precisely in the form which has been preserved to the present day, that is to say, as a fixed sum for the whole kingdom, and to be raised in quotas specified in the Act for each county, city or borough therein named. That Act was renewed every year, with scarcely any difference in its provisions as to the mode of assessment, and although the amounts charged upon the counties, etc., varied according to the total sum required from the kingdom, they were always fixed in due proportions to the original quotas. The last annual Act, so far as land was concerned, was passed in 1797.

Now it is a remarkable circumstance that these Acts of 1697 and 1797 appear to mark, more strongly than before, the taxation of personal estate as the primary object of the law.

After the clauses imposing upon goods, wares, merchandise, etc., and upon pensions and offices, the fixed charge of four shillings in the pound towards raising the quotas, that relating to land appears to treat it as a subsidiary contributor, as it were, and for the purpose of making up the sum due to the Exchequer after exhausting the other resources. The words are: "And to the end the full and entire sums by this Act charged upon the several counties, etc., may be fully and completely raised and paid; be it enacted, that all lands, etc., shall be charged by a pound rate towards the said several sums by this Act imposed."

How the duty on personal estate was levied, or what was its proportion in the quotas, we have no means of knowing. All that we do know is that in Mr Pitt's time it had dwindled nearly to nothing; and that the tax annually voted under the name of land tax had become a land tax in reality. Thus we find in an assessment for the Tower Division in 1799 that the sum charged for personal estate was only £227, while the charge for lands, etc., is £29,964; and in one of the few accounts of later transactions which remain to us, that for the year 1823, we are presented with a return of £5,416, 10s. 0d. as the ludicrous result of a tax at one per cent. on the capital value of the personalty of Great Britain.

The Commissioners go on to remark that it seems almost incredible that year after year an Act should have been passed containing the most minute directions for the assessment of personal estate, and yet that nothing which could be called an assessment should have been made. They suggest that "Perhaps the explanation may be found in another peculiarity in the administration of this tax, the tendency to regard it as a fixed charge upon the subjects on which it was originally levied. That this has been the case with land, both before and since 1797, is well known, and if the same rule was applied to personalty it is easy to conceive that, as the persons originally charged moved out of the parish, or became destitute, or otherwise unassessable, their proportion of the tax was shifted to the land as the readiest means of collecting it."