page break

The Extent of our Taxation.

[From the S A. Advertiser of May 5, 1884.]

No 3. Issued by the South Australian Land Nationalization Society.]

All who are interested in the financial history and condition of the province may, with some profit, consult a table which we publish elsewhere, showing the growth of our taxation from 1850 to the close of the financial year 1882-3. This, it will be seen, is confined to the taxation levied through the Custom-house, no note being taken of the amounts derived in recent years from the probate and succession duties. If they were added to the annual total of taxation the rate per head for the last seven years would be some what larger than is shown. The total for that period however, is so small as to be practically insignificant, amounting as it does to no more than £74,062 18s. 3d. The taxation during the course of thirty-two years with the above exception has been derived from personal taxes, for they have consisted only of the duties charged upon food, raiment, and other things of common and necessary use. To analyse those duties as we have done on former occasions, in order to show for each year where the public burdens principally fell, would entail an immense amount of labor, not at all necessary to prove that almost, if not absolutely, from the foundation of the colony the people as a mass have been unfairly, because exclusively taxed.

The annual results show some singular variations in the rate of taxation per head of the population. For the first few years they were somewhat spasmodic, and are attributable more to the general disturbances which occurred in all the colonies at the time of the gold discoveries than to the fiscal principles upon which our system of raising revenue was then founded. During the first three years of the epoch included in the table the South Australian tariff as far as can be ascertained was not altered. The population was always increasing, but at the same time the rate of taxation per head actually decreased. In 1850 it was £1 5s. 11d per head on a population of 62,700 souls. In 1852, when the reaction set in, it fell to £1 1s. 1d. per head on a population of 68,663. In 1853 the population rose to 78,944, without any change in the Customs, and the rate per head increased to £2 3s. 4d., which is the highest point reached in the thirty-two years. That year, as old colonists are aware, was a year of large expenditure. Money was abundant, and was spent lavishly if not waste fully. The great increase in the capitation rate was not altogether due to the weight of inequitable taxation, but rather to excessive and improvident consumption. It must not be forgotten, however, that all the taxes fell upon person and not upon property. Then, as now, property was held to confer upon its owners distinct rights, and beyond the conditions fixed by themselves in dealing with it, It imposed no duties upon them, except such as tended to enhance the value of their possessions and increase the profits derivable from them. The purchase of land established a sort of right in the purchasers to a certain State expenditure to render their lands accessible; but there was no counterpoise to enable the State to receive any share in the increased value conferred upon the properties for the benefit of which the money had been spent. As soon as land was sold, and after deducting the cost of surveys and the sums devoted to immigration, the balance was spent upon the improvement of the land which had passed into the hands of private owners, many of whom were then and still continue to be absentees. Some of these owners have never seen the colony, and know nothing about it beyond what their agent's communications relating to remittances may tell them.

These people have all been quite satisfied to be enriched at the public cost—to have their property protected, their interest preserved, and their incomes and estates improved by the same agency. They must, however, have always known that they did nothing for what they got, except to enjoy and profit by that cruel system which sprung from an exclusive regard for property-holders, which was accompanied by a total disregard of the interests and just claims of those who had no possession beyond their ability to labor. This is why the rate per head of taxation has always been increasing. We need not dwell upon the fluctuations. They tell their own unsatisfactory story. The page 4 lowest point indicated by this barometer of taxation was 17s. 9d. per head in 1861-2. This was at the time of the 5 per cent, ad valorem duties. Since then the tariff has undergone several changes. Whenever money has been required the necessities of the poorer class have always constituted the fund from which extra supplies have been drawn. The climax has now been reached. At the end of 1882-3, with a population of 304,812, the taxation touches £2 3s. 3d, per head. As we are all too well aware that year was one of extreme depression in all branches of trade. The year which exceeded this amount was 1853, when it came to £2 3s. 4d., and this was a year of unprecedented private and public expenditure.

The close of the year 1882-3 brings us face to face with the fact that in the course of one generation the State has taken from the means of the people the enormous amount of £8,934,306 sterling. For the sacrifice thus extorted from them they have received absolutely nothing in return. In order to arrive at a period of comparison between the sums, the use of which property has monopolised, and those which have been exacted from the people, we deduct the Customs revenue from the years 1851-2, amounting to £193,401 17s. 2d. from the gross receipts of the thirty-two years. We thus have a total of personal taxation of £8,740,963 17s. 5d. The outlay on public works for the same period amounts to £20,357,661 8s. 11d. The former sum is irrevocably gone. The latter is substantially real and existent—not as a mere amount, but as a power—a fund gratuitously bestowed on property-holders, benefiting the grantor in no degree, but year by year rendering more and more to the fortunate grantees. If we consider what an enormous increase has taken place in the value of land during the past few years, some idea may be formed of the extra value which the public expenditure has added to it. If we assume that for every pound so expended a general advantage to property equal to another pound has accrued (and this is much below the truth) we see a sum of £40,714,323 which private ownership of land has acquired at the hands of the State in one generation, As far as the State is concerned this sum in its relation to the property holder is as much sunk and lost as the sum taken from the people in Customs duties. The property holder, however, in his relation to the State has had this sum added to the value of his land It is attached inalienably to the land itself, and forms the fulcrum by means of which both selling parties and annual profits are lifted from time to time. It is impossible to deny this fact, as it is impossible to ignore the current facts that the beneficiares have done nothing to merit this astounding but blind liberality on the part of the community, and have not attempted any repayment or to yield anything whatever in return for what they have absorbed. So far from that, representatives of the landed interest have invariably promoted the continuance of the monopoly they have enjoyed. Not only have they done this but they have stubbornly resisted every attempt that has hitherto been made to impose any tax upon land. Under the plea of objecting to schemes of taxation as being imperfect, they have always succeeded in preventing taxation from becoming a fact They refused a halfpenny in the pound just as they rejected everything else that had gone before that proposition, and they will continue to refuse everything unless extra-ordinary pressure is brought to bear upon them. The position is this, that land taxation now is a matter of stern necessity as well as a matter of just principle, and at whatever cost those who represent the land interest must be compelled to yield.

The following table shows the Customs revenue, the population, and the rate of taxation per head through the Customs from 1850 down to the end of 1882-3 :—