Front Page Titles (by Subject) SECTION IV: Manner of levying Taxes. - Sketches of the History of Man, vol. 2
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SECTION IV: Manner of levying Taxes. - Henry Home, Lord Kames, Sketches of the History of Man, vol. 2 
Sketches of the History of Man Considerably enlarged by the last additions and corrections of the author, edited and with an Introduction by James A. Harris (Indianapolis: Liberty Fund, 2007). 3 Vols. Vol. 2.
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Manner of levying Taxes.
To avoid the rapacity of farmers, a mild government will, in most cases, prefer management; i.e. it will levy taxes by officers appointed for that purpose. Montesquieu (a) has handled that point with his usual sprightly elegance.
Importation-duties are commonly laid upon the importer before the cargo is landed, leaving him to add the duty to the price of the goods; and the facility of levying, is the motive for preferring that mode. But, is it not hard that the importer should be obliged to advance a great sum in name of duty, before drawing a shilling by the sale of his goods? It is not only hard, but grossly unjust; for, if the goods perish without being sold, the duty is lost to the importer: he has no claim against the public for restitution. This has more the air of despotism, than of a free government. Would it not be more equitable, that the goods should be lodged in a public warehouse, under custody of revenue-officers, the importer paying the duty as goods are sold? According to the present mode, the duty remains with the collector three years, in order to be repaid to the importer, if the goods be exported within that time: but, by the mode proposed, the duty would be paid to the treasury as goods are sold, which might be within a month from the time of importation, perhaps a week; and the treasury would profit, as well as the fair trader. There are public warehouses adjoining to the customhouse of Bourdeaux, where the sugars of the French colonies are deposited, till the importer finds a market; and he pays the duty gradually as sales are made. It rejoices me, that the same mode is adopted in this island with respect to some foreign articles necessary in our trade with Africa: the duty is not demanded, till the goods be shipped for that continent. It is also adopted with respect to foreign salt, and with respect to rum imported from our sugar-colonies.
Beside the equity of what is here proposed, which relieves the importer from advance of money, and from risk, many other advantages would be derived from it. In the first place, the merchant, having no occasion to reserve any portion of his capital for answering the duty, would be enabled to commence trade with a small stock, or to increase his trade, if his stock be large: trade would flourish, and the public revenue would increase in proportion. Secondly, It would lessen smuggling: many who commence trade with upright intention, are tempted to smuggle for want of ready money to pay the duty. Thirdly, This manner of levying the duty would not only lessen the number of officers, but remove every reason for claiming discount on pretext of leakage, samples, and the drying or shrinking of goods. In the present manner of levying, that discount must be left to the discretion of the officer: a private understanding is thus opened between him and the merchant, hurtful to the revenue, and destructive to morals. Fourthly, The merchant would be enabled to lower his prices, and be forced to lower them, by having many ri-vals; which at the same time would give access to heighten importation-duties, without raising the price of foreign commodities, above what it is at present. But the capital advantage of all would be, to render, in effect, every port in Britain a free port, enabling English merchants, many of whom have great capitals, to outstrip foreigners in what is termed a commerce of speculation. This island is well situated for such commerce; and, were our ports free, the productions of all climates would be stored up in them, ready for exportation, when a market offers; an excellent plan for increasing our shipping, and for producing boundless wealth.
[(a) ]L’Esprit des loix, liv. 13. ch. 19.