Malt tax

“ Farmer Gale persisted, “you’d understand that prices make themselves, and that what we get with one hand we have to give away with the other. Have you ever heard of the Income Tax now?”
“No,” admitted Jinny.
“Ha! You’d change your tune if you had to pay a shilling on every pound you earned. But that’s merely the last straw that breaks the camel’s back, for it isn’t only as a farmer I’m put upon. But think of the Malt Tax! It’s simply a scandal.” ”

“ And we implore the Conservative body, with whom we have so long acted, to consider whether it would not be far wiser to unite their strength to convince the country of the justice and expedience of some, at least, of these changes, than to follow the example of the Free Traders in urging the repeal of the malt tax, which could only be followed, as no addition to the indirect taxes is to be thought of, by a vast increase of the income tax, two-thirds of which would fall on the land itself. ”

“ Well, that brought the amount up to L.18,000,000 sterling, or more than one-third of the whole of the general taxation of the country, raised upon articles of food. (Laughter and cheers.) With regard to the malt tax, he thought that no impost was more unjust, because there was not a great quantity of malt liquor consumed by the higher classes, the greater portion being consumed by the working classes; and, with the exception of one or two cyder counties, malt liquor, in one shape or other, was the universal beverage of the labourers. But beer must be taxed, forsooth! ”

“ Nothing could be more precarious than the position of the Income Tax; yet but for it the surplus in hand, which Sir Charles Wood was flinging away, would not exist. Mr. Disraeli, however, in spite of Mr. Gladstone’s support, lost his motion. His inconsistency in voting for Mr. Cayley’s proposal, on the 8th of May, to abolish the Malt Tax, which yielded £5,000,000 of revenue, and in protesting, on the 30th of June, against{474} the sacrifice of £1,600,000 of surplus, as ruinous to public credit, was, of course, disastrous to his pleading. ”

“ Thus in the repeal of the house duty, the gain to the public and the loss to the revenue were practically equal; while the remission of one half of the duties on soap and leather eventually diminished the productiveness of each tax by about one-third only; a reduction of about 28 per cent, in the malt tax has lessened the produce of that tax by only two or three per cent.; and in the instance of coffee, a reduction in the duty of 50 per cent, has actually been accompanied by an increase of more than 50 per cent, in its produce. ”

“ He urged, that the malt-tax in Scotland was like taxing land by the acre throughout England, because land was worth five pounds an acre in the neighbourhood of London, and would not fetch so many shillings in the remote countries. In like manner, the English malt was valued at four times the price of that which was made in Scotland; therefore, the tax in this country must be levied by a regiment of dragoons. He owned he had a great share in making the union, with a view to secure the protestant succession ”

“ Buchanan remarks, "A duty on malt never could reduce the price of barley, because, unless as much could be made of barley by malting it as by selling it unmalted, the quantity required would not be brought to market. It is clear, therefore, that the price of malt must rise in proportion to the tax imposed on it, as the demand could not otherwise be supplied. The price of barley, however, is just as much a monopoly price as that of sugar; they both yield a rent, and the market price of both has equally lost all connexion with the original cost." ”

“ It is not a little instructive to remark that, even now, the supporters of Free Trade are compelled to stop and leave their scheme unfinished. They cannot carry it out in its integrity without ruining the finances of the country. They have exposed the farmer to unlimited competition in produce, but they still continue to restrict the sphere of his industry and production. The malt-tax is a heavy burden upon him, and he is specially prohibited from growing tobacco, or engaging in the manufacture of beetroot sugar. These restrictions, say the Free-Traders, are absolutely necessary for revenue. ”

“ Ellman, in his evidence before the Agricultural Committee, said, that, when he began farming, forty-five years ago, there was not a labourer’s family in the parish that did not brew their own beer and enjoy it by their own fire-sides; and that, now, not one single family did it, from want of ability to get the malt. It is the tax that prevents their getting the malt; for, the barley is cheap enough. The tax causes a monopoly in the hands of the maltsters, who, when the tax is two and sixpence, make the malt, cost 7s. ”

“ A greater revenue than what is at present drawn from all the heavy taxes upon malt, beer, and ale, might be raised, it has frequently been said, by a much lighter tax upon malt; the opportunities of defrauding the revenue being much greater in a brewery than in a malt-house; and those who brew for private use being exempted from all duties or composition for duties, which is not the case with those who malt for private use. ”

“ The tax on malt is as much a part of the cost of production of that article as the wages of the labourers. The expenses which the law imposes, as well as those which the nature of things imposes, must be reimbursed with the ordinary profit from the value of the produce, or the things will not continue to be produced. But the influence of taxation on value is subject to the same conditions as the influence of wages and of profits. It is not general taxation, but differential taxation, that produces the effect. ”

“ No tax can ever reduce, for any considerable time, the rate of profit in any particular trade, which must always keep its level with other trades in the neighbourhood. The present duties upon malt, beer, and ale, do not affect the profits of the dealers in those commodities, who all get back the tax with an additional profit, in the enhanced price of their goods. A tax, indeed, may render the goods upon which it is imposed so dear, as to diminish the consumption of them. ”

“ But the brewer is at present obliged to advance a tax of twenty-four or twenty-five, sometimes thirty shillings, upon every quarter of malt which he brews. It could not be more inconvenient for the maltster to advance a lighter tax, than it is at present for the brewer to advance a heavier one. The maltster does not always keep in his granaries a stock of malt, which it will require a longer time to dispose of than the stock of beer and ale which the brewer frequently keeps in his cellars. ”

“ The tax on cider raised such a storm of opposition from the country members generally, without reference to party, that Bute was induced to alter both the sum and the mode of levying it—four shillings per hogshead was to be paid, and it was to be levied upon the grower, through the medium of the exciseman. This was not an unreasonable tax, for ale and porter were already taxed both directly and indirectly, and no argument could show that while a liquor produced from malt contributed to the public exigencies, a liquor produced from apples should be exempt. ”

“ The tax being on the beer, Government no longer cares whether it is brewed from malt or from rubbish, and the consumers grow soon accustomed to the lowered taste of malt in their beer; Secondly, The admission of foreign malt and barley without duty has quickened the importation by removing those restraints and interferences which hamper trade out of all proportion to their expressed amounts in pounds, shillings, and pence. ”

“ Yet the United States government has long lent its sanction to the "medicine" status by exempting Duffy's Pure Malt Whiskey from the federal liquor tax. In fact, the government is primarily responsible for the formal establishment of the product as a medicine, having forced it into the patent medicine ranks at the time when the Spanish war expenses were partly raised by a special tax on nostrums. Up to that time the Duffy product, while asserting its virtues in various ills, made no direct pretense to be anything but a whiskey. ”

“ How is it that farmers are so exact, and show such a disposition to retrench in the article of labour, when they seem to think little, or nothing, about the sums which they pay in tax upon malt, wine, sugar, tea, soap, candles, tobacco, and various other things? You find the utmost difficulty in making them understand, that they are affected by these. The reason is, that they see the money which they give to the labourer on each succeeding Saturday night; but they do not see that which they give in taxes on the articles before mentioned. ”

“ The promises that liberal reduction will lead to recovery of anything like the old or previous revenue have always been confidently pressed by irresponsible men, and are in my opinion illusory. The tax is a tax on property: and, as we have too few of these rather than too many, what would seem desirable is to commute it; leaving no more than a penny stamp on the policy. This might perhaps be done, if it were made part of a large budget. 6. The income-tax at 6d., I suppose, presents a forward claim. 7. The commutation of malt duty for beer duty must always, I presume, be spoken of with respect ”

“ "A tax on bread will be ultimately paid, not by a rise of price, but by a reduction of rent."24 If a tax on malt would raise the price of beer, a tax on bread must raise the price of bread. ”

“ Scotland was very much averse to the tax on malt; but she is so far from being ruined by it, that it has only taught her to double her industry, and to supply, by labour, what she was obliged to give up to the necessities of the state. Can America be said to be poorer, to be more scanty of money than Scotland? No. What then follows? America must be taxed.
It is in vain to pretend that the increase of the American territories, and of the commodities, which they furnish to the British markets, has reduced the price of any article ”

“ Those taxes are best which in case of need can be most conveniently increased in amount. It is this characteristic of the income tax which renders it so popular with chancellors of the exchequer, and it was partly on this ground that Mr Gladstone substituted a tax on beer for the tax on malt, (e) Regard must always be paid to the real incidence of taxation, and care taken that the real burden of the tax falls on those aimed at by the legislature. ”

“ The worst kind of proportional taxes are those which are levied upon private manufacturing, and upon unmanufactured consumption, where no alienation takes place. An example of the first we have in the excise upon malt, cyder, candles, &c. made in private houses for private use: the last is known in Holland, where a man cannot kill his own pig, or his own calf, without paying a tax. ”

“ The so-called excise of $1,000 is forty times as great. It is ten times as great as the annual tax under Rev. St. § 3244, as amended, for wholesale liquor dealers and brewers, and fifty times as great as that imposed upon dealers in malt liquors. If the imposts under Rev. St. § 3244, as amended, were fixed in amount in accordance with the importance of the business or supposed ability to pay, the exaction in question is highly exorbitant. This fact points in the direction of a penalty rather than a tax. ”

“ Experience has demonstrated what the ordinary production from a given quantity of material is. If the production as shown by the books differed from that which ordinarily would be the yield of the material purchased, the burden, as the law then stood, was cast upon the manufacturer after a reassessment to account for the discrepancy. It is unnecessary now to decide whether this rule of evidence has been changed by the 'Act to define the tax on fermented or malt liquors,' passed May 13, 1876. ”

“ He knew nothing of the terrible burden of taxation which crippled and oppressed the poor. He was generally exempted from paying the Taille, the most grievous of all the taxes; and even those imposts—the Poll-tax and the Vingtièmes—to which he was subject, were collected from him in a specially indulgent manner. The greater a man's wealth or station, the better was his chance of securing easy terms. The Government's agents felt bound to act 'with marked consideration' in collecting the taxes of people of rank. ”

“ The approach of the Government's agent was the signal for panic and disorder, and the miserable villagers fled for concealment to the woods.
Even more grievous than the Corvée and the militia were the abuses which pervaded the whole system of taxation. The heaviest of all the taxes was the terrible burden of the Taille, a direct tax levied sometimes on property and sometimes on income, falling almost entirely on the poor—alike on the struggling landowner and on the landless labourer—assessed without order or method, constantly varying and constantly increased. ”

“ It was not until the working classes of Paris compelled the municipality to suggest the abolition of the impost, that the octrois of Paris were swept away.
Having thus lost a great deal of the revenue raised by indirect taxation, the Assembly proceeded to make up the deficit by imposing two direct taxes, a Poll-tax which was inconsiderable and light, and a tax upon land which was overwhelmingly heavy. The burden of the [Pg 96] new land-tax was in itself disproportionate and probably unjust; it was aggravated by a perverse system of rating ”

“ It was shown, in a former part of this inquiry, that before such application of capital could take place, the price of produce, compared with the instruments of production, must rise sufficiently to pay the farmer. But, if the increasing difficulties to be overcome are aggravated by taxation, it is necessary, that before the proposed improvements are undertaken, the price should rise sufficiently, not only to pay the farmer, but also the government. And every tax, which falls on agricultural capital, either prevents a proposed improvement, or causes it to be purchased at a higher price. ”