said that it is coming more and more to be recognized that within the domain of the taxing power the principle of benefits should be followed to some extent in strictly local finance.1 If this is true, the principle of progression will be of rather more limited application to some of the charges employed for the support of local government; for the theory of benefits, as we have seen, leads logically to proportion, not to progression. Thus the practical sphere of the applicability of the progressive principle would be even more circumscribed.

Finally, it must not be overlooked that high rates of progression may engender or augment attempts at fraud and evasion. That this is possible cannot be denied. But, as has already been pointed out, the danger is apt to be greatly exaggerated. We know that there is certainly more fraud in the countries of proportional taxes like America than in the home of progressive taxes like Switzerland or Germany. Still it may be conceded that with progressive rates there would probably be even more fraud than actually exists, even though the fears of the doubters in Australia and Switzerland have not been realized. Much depends on the manner in which progression is applied, and the particular tax to which it is extended. Still more depends on the rate of the progression. The higher the progression, the more likely that the results will be perceptibly bad. But the objection is really one against the abuse, not the use, of the progressive principle.

If, therefore, we sum up the whole discussion, we see that while progressive taxation is to a certain extent defensible as an ideal, and as the expression of the theoretical demand for the shaping of taxes to the test of individual faculty, it is a matter of considerable difficulty to decide how far or in what manner the principle ought to be actually carried out in practice.

Theory itself cannot determine any definite scale of progression whatever. And while it is highly probable that the ends of justice would be more nearly subserved by some approximation to a progressive scale, considerations of expediency as well as the uncertainty of the interrelations between various parts of

1 For a discussion of these points, see my article on The Classification of Public Revenues, Quarterly Journal of Economics, Vol. VII, pp. 311 et seq. (See also the author's Essays in Taxation, 265-304 (second edition, New York, 1900). — ED.

the entire tax system should tend to render us cautious in advocating any general application of the principle. It remains to investigate as to how far the principle is applicable to the conditions surrounding us in America to-day.1 But, in last resort, the crucial point is the state of the social consciousness and the development of the feeling of civic obligation.

1 In the following chapter of his monograph, Professor Seligman considers the practicability of progressive taxation, especially in the United States, and comes to the following conclusion:

"We see then that while progression of some sort is demanded from the standpoint of ideal justice, the practical difficulties in the way of its general application are well-nigh insuperable. Progression is defensible only on the theory that the taxes are so arranged as to strike every individual on his real income. But in default of a single tax on incomes, which is visionary, practicable tax systems can reach individual incomes only in a very rough and roundabout way. Under such practical conditions it is doubtful whether greater individual justice will be attained by a system of progression than by the simple rule of proportion; and it is questionable whether the ideal advantages of progression would not be outweighed by its practical shortcomings. For the United States at all events, the only important tax to which the progressive scale is at all applicable at present is the inheritance tax. For the future development of the idea we must rely on an improvement in the tax administration, on a more harmonious method of correlating the public revenues, and on a decided growth in the alacrity of individuals to contribute their due share to the common burdens." - ED.

CHAPTER X

CAPITATION TAXES

35. The Poll Tax in American Commonwealths. Although the poll tax has been abandoned in most of the countries of Europe,1 it is still found in about half of the American states.2 Sometimes it is a distinct state tax; sometimes it is associated with the general property tax; sometimes it is merely a local tax, and used for such local purposes as the care of highways. It is found in most of the New England and the Southern states, but less frequently in the Central or Western states. In many cases the tax is poorly collected, as may be illustrated by the experience of Wisconsin. In that state the poll tax is a local tax which in towns and villages is "to be collected for highway purposes only." In 1898 the Wisconsin Tax Commission reported that the law "has become practically a dead letter in many portions of the state"; that "more than half the towns and villages in the state and about two thirds of the cities did not collect any poll tax in 1897"; and that in eight counties not a dollar of poll tax was collected." The net result was stated as follows:

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Of the 1137 towns and villages in the state only 493 made any attempt to collect any poll taxes, and the total amount which they collected was $95,871.75. Of the III cities only 39 report any poll tax raised, and the total amount obtained was the comparatively small sum of $12,578.37.3

1 Capitation taxes are employed in France and some of the Swiss cantons. The French personal tax (impôt personnel) will be described in the next chapter.

2 The experience of the American states is described by Seligman in his monograph on Finance Statistics of American Commonwealths, in Publications of American Statistical Association, 1889.

3

Report of the Wisconsin State Tax Commission, 1898, pp. 68 and 107.

36. The Poll Tax in Massachusetts. The Commission of 1897 gave the following account of the working of the poll tax in Massachusetts: 1

The Commonwealth of Massachusetts levies a poll or capitation tax on every male inhabitant of the Commonwealth above the age of twenty years, whether a citizen of the United States or an alien, and upon every female citizen of said age requesting to be assessed therefor. The poll tax of the old, poor, and infirm may be abated at the discretion of the assessors.

The assessors are required to canvass their respective cities and towns, and after diligent inquiry to make true lists of every male person above the age of twenty years residing in their city or town, and of all women of the like age who request to be assessed. In cities and towns of more than five thousand inhabitants the assessors are required to prepare and to have printed street lists arranged by voting precincts, designating all buildings used for residences, and giving the age, name, and occupation of every person assessed for a poll tax. These lists are sent to the registrars of voters, though it is not necessary for registration that the voter's name be entered upon this list. The registrars, on their part, are required to make a return to the assessors of the names of all persons who have registered with them and whose names are not upon the assessors' lists. The assessors, having obtained a list of all those liable for a poll tax, proceed to assess upon them the state and county taxes. The state tax is assessed upon the number of polls in each place until such assessment amounts to $1 upon each poll, the remainder of the tax being then assessed upon property. In like manner the county taxes are assessed upon the polls up to the sum of $1 on each poll, the remainder there also being assessed on property. The effect is that the rate of the poll tax is in almost all cities and towns $2 per year. In six localities only is there a less rate. In the city of Chelsea and in the towns of Winthrop and Revere the poll tax is only $1. This arises from the fact that the city of Boston assumes the entire county tax for the county of Suffolk; hence in these places the poll tax is limited to the state tax of $1.

1 Report of the Commission on Taxation, pp. 3–5.

In three towns the amount of the total poll tax levied in the manner described above is less than $2, namely: Savoy, $1.80; Gay Head, $1.50; and Prescott, $1.97.

In former years payment of the tax was a condition of the exercise of the franchise. For that reason it was for the most part paid, if not directly by the person upon whom it was assessed, then paid on his behalf by the political organization to which he belonged. By an amendment of the Constitution in 1891 the provision making the payment of the tax a prerequisite to voting was repealed. Since that time it has been difficult to collect the tax from those not subject to the tax for property. The amount in each case being small, the tax is now in the cities very largely uncollectible, except from persons who are also taxed for property.

Although the poll tax is thus, strictly speaking, a state and county tax, it is not to be inferred that the financial resources of the state or of the counties are affected by the difficulty of collecting it. The cities and towns pay over their respective shares of the state and county taxes, without regard to the success of their collection of the poll tax. They are accountable for contributing their apportioned quotas to state and counties, first by the poll tax and then by taxes on property. What they do not succeed in raising by the former tax they must make up by the latter.

The number of male persons assessed for poll tax in 1896 was 723,736; the number of persons assessed for poll tax only was 511,659; the amount of the tax assessed on polls was $1,434,629.1

37. The Poll Tax in North Carolina.—The poll tax has played a more important part in the history of North Carolina than in probably any other state in the American Union. Until the time of the Revolution North Carolina never employed any direct tax except that upon polls, in the assessment of which adult white males and adult colored males and females were included. Indirect taxation, moreover, was not very important, being confined for the most part to light duties on imported.

1 For 1904 the assessment upon polls was $1,676,726. — Ed.