30
YOUR TAXES
BESIDES buying things in the shops you have to pay rates, taxes, telephone rent (if you have a telephone), and rent of house and land. Let us examine this part of your expenditure, and see whether you get hit here again and again.
People grumble a great deal about the rates, because they get nothing across the counter for them; and what they do get they share with everyone else, so that they have no sense of individual property in it, as they have in their clothes and houses and furniture. But they would not possess their clothes or their furniture or their houses very long in peace but for the paved and lighted and policed streets, the water supply and drainage, and all the other services the rates pay for. The Intelligent Woman, when she begins to study these matters, soon realizes that she gets better value for her rates than for any other part of her expenditure, and that the municipal candidates who ask for her vote on the ground that they are going to abolish or reduce the rates (which they fortunately cannot do) are mostly either fools or humbugs, if not both. And she has the satisfaction of knowing that she gets these services as nearly as possible at their cost to the local authority, which not only does not profiteer at her expense, but does for nothing a great deal of directorial work that in any private business would have to be paid for, and under present circumstances ought to be paid for, in public business as well.
The same advantage can be claimed for taxes. Of all the public services which you pay for in taxes to the Government it can be said that there is no direct profiteering in them: you get them for what they cost the Government: that is, for much less than you would have to pay if they were private business concerns.
So far it would seem that when you pay your rates and taxes you escape the exactions which pursue you whenever you spend money in any other way. You are perhaps beginning to feel that the next time the collector calls you will hear his knock with joy, and welcome him with the beaming face of the willing giver.
I am sorry to spoil it all; but the truth is that Capitalism plunders you through the Government and the municipalities and County Councils as effectually as it does through the shopkeeper. It is not only that the Government and the local authorities, in order to carry on their public services, have to buy vast quantities of goods from private profiteers who charge them more than cost price, and that this overcharge is passed on to you as a ratepayer and taxpayer. Nor is it that the Government of the country, acting for the people of the country, cannot use the land of the country without paying some private person heavily for leave to do so. There are ways of getting round these overcharges, as, for instance, when the Government buys a piece of land for its operations, but raises the money to pay for it by a tax on rent which only the landlords pay, or when it raises capital by a tax on unearned incomes. By this expedient it can, and sometimes does, give you a complete and genuine cost price service. It can even give it to you for nothing and make richer people pay for it.
But you are rated and taxed not only to pay for public services which are equally useful to all, but for other things as well; and when you come to these you may, if you are a rich woman, complain that you are being plundered by Socialists for the benefit of the poor, or, if you are a poor woman, that you are being plundered by Capitalists who throw on the rents and taxes certain expenses which they should pay out of their own pockets.
Let us see what foundation there is for such complaints. Let us begin with the rich. By taxation rich people have a quarter or a third of their incomes, and very rich people more than half, taken from them by the Government, not for any specified public service, but as pure nationalization (communization) of their income to that extent without any compensation, and by simple coercion. This is now taken so completely as a matter of course that the rich never dream of asking for compensation, or refusing to pay until their goods are forcibly seized, or even of calling it Bolshevik confiscation; and so we are apt to talk as if such things never happened except in the imaginations of wicked Communists; but they happen in Great Britain regularly every January; and the Act authorizing them is brought in every April by the Chancellor of the Exchequer. Though reassuringly called the Appropriation Act it is really an Expropriation Act.
There is nothing in the law or the Constitution, or in any custom or tradition or parliamentary usage or any other part of our established morality, to prevent this confiscated third or half being raised to three-quarters, nine-tenths, or the whole. Besides this, when a very rich person dies, the Government confiscates the entire income of the property for the next eight years. The smallest taxable properties have to give up their incomes to the Government for ten months, and the rest for different periods between these extremes, in proportion to their amount.
In addition, there are certain taxes paid by rich and poor alike, called indirect taxes. Some of them are taxes on certain articles of food, and on tobacco and spirits, which you pay in the shop when you buy them, as part of the price. Others are stamp duties: twopence if you give a receipt for £2 or more, sixpence if you make a simple written agreement, hundreds of pounds on certain other documents which propertyless people never use. None of these taxes are levied for a named service like the police rate or the water rate: they are simple transfers of income from private pockets to the national pocket, and, as such, acts of pure Communism. It may surprise you to learn that even without counting the taxes on food, which fall on all classes, the private property thus communized already amounts to nearly a million a day.
The rich may well gasp at the figure, and ask what does the Government do with it all? What value do they get for this contribution which appears so prodigious to most of us who have to count our incomes in hundreds a year and not in millions a day? Well, the Government provides an army and navy, a civil service, courts of law and so forth; and, as we have seen, it provides them either at cost price or more nearly at cost price than any commercial concern would. But over a hundred million solid pounds of it are handed over every year in hard cash in pensions and doles to the unfortunate people who have small incomes or none.
This is pure redistribution of income: that is, pure Socialism. The officers of the Government take the money from the rich and give it to the poor because the poor have not enough and the rich have too much, without regard to their personal merits. And here again there is no constitutional limit to the process. I can remember a time when there was no supertax, and the income tax was twopence in the pound instead of four-and-sixpence or five shillings, and when Gladstone hoped to abolish it altogether. Nobody dreamt then of using taxation as an instrument for effecting a more equal distribution of income. Nowadays it is one of the chief uses of taxation; and it could be carried to complete equality without any change in our annual exchequer routine.
So far the poor have the better of the bargain. But some of the rich do very well out of the taxes. By far the heaviest single item of Government expenditure is the annual payment for the hire of the money we borrowed for the war. It is all spent and gone; but we must go on paying for the hire until we replace and repay it. Most of it was borrowed from the rich, because they alone had any spare money to lend. Consequently the Government takes a vast sum of money every year from the whole body of rich, and immediately hands it back to those who lent it money for the war. The effect of this transaction is simply to redistribute income between the rich themselves. Those who lose by it make a fuss about what they call the burden of the National Debt; but the nation is not a penny the poorer for taking money from one bold Briton and giving it to another. Whether the transfer is for better or worse depends on whether it increases or diminishes the existing inequality. Unfortunately, it is bound, on the whole, to increase it, because the Government, instead of taking money from some capitalists and dividing it among them all, is taking money from all capitalists and dividing it among some of them. This is the real mischief of the National Debt, which, in so far as it is owed to our own people, is not a debt at all. To illustrate, one may say that an elephant does not complain of being burdened because its legs have to carry its own weight; but if all the weight were on one side instead of being equally distributed between the legs, the elephant would hardly be able to carry it, and would roll over on its back when it met the slightest obstacle, which is very much what our trade does under our unequal system.
It is sometimes said that the capitalists who lent the Government the money for the war deserve the hire of it because they made sacrifices. As I was one of them myself I can tell you without malice that this is sentimental nonsense. They were the only people who were not called on to make any sacrifice: on the contrary, they were offered a gilt-edged investment at five per cent when they would have taken four. The people who were blinded, maimed, or killed by the war were those really sacrificed; and those who worked and fought were the real saviors of the country; whilst the people who did nothing but seize the national loaf that others had made, and take a big bite out of it (they and their servants) before passing on what they left of it to the soldiers, did no personal service at all: they only made the food shortage still shorter. The reason for pampering them in this absurd fashion was not for any service or merit on their part: it was the special consideration we have to shew to spare money as such because we are afraid there would not be any available if we did not pamper a class by giving it more than it can spend. We shall have to go further into this when we examine the nature of capital later on. Meanwhile, if you had the misfortune to lose an eye during one of the air raids, or if you lost your husband or son, or if you “did your bit” strenuously throughout the war, and are now a taxpayer, it must seem to you, to say the least, funny to have money taken from you by the Government and handed over to some lady who did nothing but live as indulgently as she could all the time. You will not easily be convinced that it would have been a more dreadful thing for the Government to commandeer her money than your husband’s limbs, or your son’s life. The utmost that can be said is that it may have been more expedient.
One more example of how your taxes may be used to enrich profiteers instead of to do you any service. At the beginning of the war, the influence of the profiteers was so strong that they persuaded the Government to allow them to make all the shells instead of having them made in national factories. The result was that you were paying taxes to keep workmen standing idle in Woolwich Arsenal at full wages in order that the profiteering firms should have all the work at a profit. You had to pay their workmen too, and the profit into the bargain. It soon turned out that they could not make nearly enough shells. Those they did make were unnecessarily expensive and not always explosive. The result was an appalling slaughter of our young men in Flanders, who were left almost defenceless in the trenches through the shortage of munitions; and we were on the verge of being defeated by simple extermination when the Government, taking the matter in hand itself, opened national factories (you may have worked in some of them) in which munitions were produced on such a scale that we have hardly yet got rid of what was left of them when the war ended, besides controlling the profiteers, teaching them their business (they did not know even how to keep proper accounts, and were wasting money like water), and limiting their profits drastically. And yet, in the face of this experience (which was of course a tremendous triumph for the advocates of nationalized industries), the war was no sooner at an end than the capitalist papers began again with their foolish and corrupt declarations that Governments are such incompetent and dishonest and extravagant jobbers, and private firms so splendidly capable and straightforward, that Governments must never do anything that private firms can make profits by doing; and very soon all the national factories were sold for an old song to the profiteers, and the national workers were in the streets with the demobilized soldiers, living on the dole, two millions strong.
This is only a sensational instance of something that is always going on: namely, the wasting of your money by employing profiteering contractors to do the work that could be done better by the authorities themselves without charging you any profit.
You see therefore that when you pay rates and taxes you are not safe from being charged not only the cost price of public services, but huge sums which go to private employers as unnecessary or excessive profits, to the landlords and capitalists whose land and capital these employers use, and to those property owners who hold the War Loan and the other stocks which represent the National Debt. But as you may also get back some of it as a pensioner or a recipient of public relief in some form or other, or as you may yourself be a holder of War Loan or Consols, or a shareholder in one of the commercial concerns which get contracts from the Government and the municipalities, it is impossible for me to say whether, on the whole, you gain or lose. I can only say that the chances are ten to one that you lose on balance; that is, that the rich get more out of you through the Government than you get out of them. So much for the taxes. Now for the rates.