16 KiB
--- ENTITY: public revenue ---
Public Revenue
Definition
The income derived by the sovereign or commonwealth from various sources to defray the necessary expenses of government, including defense, maintaining the dignity of the chief magistrate, and other governmental costs not provided for by particular revenues.
Source Chapter
Book V, Chapter 2
Context
The chapter's central focus, examining how governments obtain funds to support their operations. Smith distinguishes between revenues that peculiarly belong to the sovereign (such as stock, land, and commercial enterprises) and those that must be drawn from the people through taxation.
Economic Domain
General Theory
--- ENTITY: sovereign revenue sources ---
Sovereign Revenue Sources
Definition
The distinct funds or mechanisms through which a sovereign or commonwealth may generate income independently of the general population, including stock, land, and commercial enterprises that can be directly managed by the state.
Source Chapter
Book V, Chapter 2
Context
Smith categorizes these as the first type of public revenue, distinguishing them from taxes that must be drawn from the people. He examines various sovereign revenue sources including public banks, post offices, and crown lands.
Economic Domain
General Theory
--- ENTITY: public bank revenue ---
Public Bank Revenue
Definition
The income generated by a sovereign through the operation of a public bank, derived from the difference between the interest charged on loans and the interest paid on deposits, plus any management fees and profits from banking operations.
Source Chapter
Book V, Chapter 2
Context
Smith discusses how public banks in cities like Hamburg, Venice, and Amsterdam have provided revenue to their respective governments, noting that such institutions require careful management to be successful.
Economic Domain
General Theory
--- ENTITY: post-office revenue ---
Post-Office Revenue
Definition
The income generated by a sovereign through the operation of a postal system, derived from fees charged for carrying letters and parcels, which can provide both public service and profit to the state.
Source Chapter
Book V, Chapter 2
Context
Smith identifies the post-office as a mercantile project that has been successfully managed by various governments, noting its advantages of requiring moderate capital, having certain returns, and providing immediate payment.
Economic Domain
General Theory
--- ENTITY: crown lands revenue ---
Crown Lands Revenue
Definition
The income derived by a sovereign from the rent and produce of lands owned directly by the state, which historically constituted a major portion of royal revenue in many European monarchies.
Source Chapter
Book V, Chapter 2
Context
Smith examines how rent from crown lands has been a principal source of public revenue for many nations, particularly in ancient times, and discusses how the management of such lands affects their productivity and the revenue they generate.
Economic Domain
General Theory
--- ENTITY: land tax ---
Land Tax
Definition
A tax levied on the rent or value of land, which may be assessed either according to a fixed valuation or varied with changes in the actual rent of the land, and which can be a significant source of public revenue.
Source Chapter
Book V, Chapter 2
Context
Smith analyzes different methods of assessing land taxes, comparing the English system of fixed valuation with more variable systems, and discusses the advantages and disadvantages of each approach for both the government and landowners.
Economic Domain
General Theory
--- ENTITY: house rent tax ---
House Rent Tax
Definition
A tax imposed on the rent of houses, which falls partly upon the inhabitants who pay it and partly upon the owners of the ground, with the final burden distributed between them based on the relative value of building rent versus ground rent.
Source Chapter
Book V, Chapter 2
Context
Smith distinguishes between building rent (the profit on capital expended in building) and ground rent (the price for the use of land), explaining how a tax on house rent affects each component differently and ultimately falls more heavily on the rich.
Economic Domain
General Theory
--- ENTITY: ground rent tax ---
Ground Rent Tax
Definition
A tax specifically levied on the rent of land upon which buildings stand, which falls entirely upon the owner of the ground as a monopolist who exacts the maximum rent possible for the use of his land.
Source Chapter
Book V, Chapter 2
Context
Smith argues that ground rents are particularly suitable for taxation because they arise from the good government of the sovereign rather than from any effort by the landowner, and such a tax would not discourage industry or improvement.
Economic Domain
General Theory
--- ENTITY: window tax ---
Window Tax
Definition
A tax imposed on houses based on the number of windows they contain, which was intended to be a more convenient method of assessment than previous taxes but proved to be unequal in its burden on different social classes.
Source Chapter
Book V, Chapter 2
Context
Smith discusses the window tax as an example of how taxes on houses have been implemented in England, noting its advantages in ease of assessment but criticizing its inequality in falling more heavily on the poor than the rich.
Economic Domain
General Theory
--- ENTITY: stock profit tax ---
Stock Profit Tax
Definition
A tax levied on the profits derived from the employment of capital in various trades and businesses, which ultimately falls upon the consumers of the goods produced rather than the dealers themselves.
Source Chapter
Book V, Chapter 2
Context
Smith explains that taxes on the profits of stock cannot affect the interest of money itself but must be passed on to consumers through higher prices, and discusses how such taxes affect different branches of trade unequally.
Economic Domain
General Theory
--- ENTITY: interest of money tax ---
Interest of Money Tax
Definition
A tax imposed on the revenue derived from lending money at interest, which cannot raise the rate of interest itself but must be borne by the lender through reduced returns or passed on to borrowers through higher borrowing costs.
Source Chapter
Book V, Chapter 2
Context
Smith argues that the interest of money is a less proper subject for direct taxation than land rent because the amount of capital is difficult to ascertain and can be easily moved between countries, making such taxation inefficient and potentially harmful.
Economic Domain
General Theory
--- ENTITY: capitation tax ---
Capitation Tax
Definition
A tax levied on individuals regardless of their wealth or income, typically assessed according to rank or supposed fortune, which tends to be arbitrary and unequal in its burden on different social classes.
Source Chapter
Book V, Chapter 2
Context
Smith criticizes capitation taxes as being either arbitrary when proportioned to fortune or unequal when proportioned to rank, and discusses how such taxes have been implemented in various countries with different degrees of severity.
Economic Domain
General Theory
--- ENTITY: tax on consumable commodities ---
Tax on Consumable Commodities
Definition
A tax imposed on goods that are consumed, which may be levied either on the consumer through periodic licenses or on the dealer before the goods reach the consumer, and which falls ultimately on the revenue of those who consume the taxed commodities.
Source Chapter
Book V, Chapter 2
Context
Smith examines various types of taxes on consumable commodities, distinguishing between those on necessaries and luxuries, and discusses how such taxes affect different classes of society and the overall economy.
Economic Domain
General Theory
--- ENTITY: tax on necessaries ---
Tax on Necessaries
Definition
A tax imposed on goods that are essential for life or considered necessary by social custom, which raises the price of these goods and consequently the wages of labour, ultimately falling on landlords through reduced rent and on consumers through higher prices.
Source Chapter
Book V, Chapter 2
Context
Smith argues that taxes on necessaries are particularly burdensome because they affect the poor most heavily and raise the cost of production throughout the economy, making them less desirable than taxes on luxuries.
Economic Domain
General Theory
--- ENTITY: tax on luxuries ---
Tax on Luxuries
Definition
A tax imposed on goods that are not essential for life and whose consumption is optional, which falls directly on the consumers of these goods without affecting the wages of labour or the prices of other commodities.
Source Chapter
Book V, Chapter 2
Context
Smith considers taxes on luxuries to be more equitable than taxes on necessaries because they are paid voluntarily by those who choose to consume such goods, and they do not have the broader economic effects of raising wages or prices.
Economic Domain
General Theory
--- ENTITY: excise duties ---
Excise Duties
Definition
Taxes imposed on goods produced domestically for home consumption, typically on a few articles of general use, which are levied by government administration and provide a significant portion of public revenue.
Source Chapter
Book V, Chapter 2
Context
Smith discusses excise duties as a major source of revenue, examining their advantages in terms of certainty and convenience of collection, while also noting their tendency to discourage certain branches of industry and encourage smuggling.
Economic Domain
General Theory
--- ENTITY: customs duties ---
Customs Duties
Definition
Taxes imposed on goods imported from foreign countries, which historically were intended to tax the profits of merchants but now serve primarily as a source of revenue and sometimes as instruments of monopoly or trade regulation.
Source Chapter
Book V, Chapter 2
Context
Smith traces the history of customs duties from their origins as taxes on merchant profits to their current role in revenue generation, and critiques their use as instruments of monopoly rather than revenue.
Economic Domain
General Theory
--- ENTITY: stamp duties ---
Stamp Duties
Definition
Taxes imposed on legal documents and transfers of property, requiring that certain papers bear stamps of specified values, which generate revenue from the transference of property from the dead to the living or from the living to the living.
Source Chapter
Book V, Chapter 2
Context
Smith examines stamp duties as a method of taxing property transfers, noting their advantages in certainty and low collection costs, while also discussing their tendency to diminish the capital value of property and discourage productive investment.
Economic Domain
General Theory
--- ENTITY: registration duties ---
Registration Duties
Definition
Taxes imposed on the official recording of legal documents and property transfers, which generate revenue from the administrative process of registering deeds, mortgages, and other legal instruments.
Source Chapter
Book V, Chapter 2
Context
Smith discusses registration duties alongside stamp duties as methods of taxing property transfers, noting their advantages in security for creditors and purchasers, but also their potential for abuse when registration offices are multiplied for revenue purposes.
Economic Domain
General Theory
--- ENTITY: tax administration systems ---
Tax Administration Systems
Tax Administration Systems
Definition
The organizational structures and methods by which taxes are collected, including direct government administration versus farming taxes to private contractors, which significantly affect the efficiency, cost, and fairness of tax collection.
Source Chapter
Book V, Chapter 2
Context
Smith compares different systems of tax administration, arguing that direct government collection is generally more efficient and less burdensome than farming taxes to private contractors, who seek excessive profits at public expense.
Economic Domain
General Theory
--- ENTITY: tax farming ---
Tax Farming
Definition
The practice of leasing the right to collect taxes to private individuals or companies for a fixed rent, who then profit from any amount they collect above that rent, often leading to excessive and oppressive collection methods.
Source Chapter
Book V, Chapter 2
Context
Smith criticizes tax farming as an inefficient and oppressive method of revenue collection that encourages corruption, excessive enforcement, and the extraction of profits by farmers at the expense of the public.
Economic Domain
General Theory
--- ENTITY: public warehouse system ---
Public Warehouse System
Definition
A system for collecting customs duties where imported goods are stored in government-controlled warehouses until duties are paid, allowing for more efficient collection and reduced smuggling opportunities.
Source Chapter
Book V, Chapter 2
Context
Smith proposes this system as a reform to improve customs collection, arguing that it would reduce the expense of collection, prevent smuggling more effectively, and allow for the simplification of customs duties.
Economic Domain
General Theory
--- ENTITY: four maxims of taxation ---
Four Maxims of Taxation
Definition
Smith's four principles for good taxation: equality (proportional to ability), certainty (clear and not arbitrary), convenience (paid at convenient times and in convenient ways), and economy (minimal collection costs and economic distortion).
Source Chapter
Book V, Chapter 2
Context
Smith presents these four maxims as the fundamental criteria by which all taxes should be judged, using them throughout his analysis of different tax types to evaluate their relative merits and defects.
Economic Domain
General Theory
--- ENTITY: equality in taxation ---
Equality in Taxation
Definition
The principle that taxes should be proportional to the ability of taxpayers to pay, meaning that individuals should contribute to public expenses in proportion to their respective revenues or incomes under state protection.
Source Chapter
Book V, Chapter 2
Context
Smith identifies this as the first of his four maxims, arguing that equality in taxation is essential for fairness and social stability, though he acknowledges that perfect equality is difficult to achieve in practice.
Economic Domain
General Theory
--- ENTITY: certainty in taxation ---
Certainty in Taxation
Definition
The principle that the amount, time, and manner of tax payment should be clear and unambiguous to both the taxpayer and others, preventing arbitrary assessment and reducing opportunities for corruption.
Source Chapter
Book V, Chapter 2
Context
Smith identifies this as the second of his four maxims, arguing that certainty in taxation is crucial for preventing oppression and corruption, even if it means accepting some degree of inequality.
Economic Domain
General Theory
--- ENTITY: convenience in taxation ---
Convenience in Taxation
Definition
The principle that taxes should be levied at times and in ways that are most convenient for taxpayers to pay, minimizing disruption to their economic activities and financial circumstances.
Source Chapter
Book V, Chapter 2
Context
Smith identifies this as the third of his four maxims, arguing that convenience in taxation reduces the burden on taxpayers and increases the likelihood of compliance.
Economic Domain
General Theory
--- ENTITY: economy in taxation ---
Economy in Taxation
Definition
The principle that the collection of taxes should be accomplished with minimal expense and economic distortion, ensuring that the cost of collection does not exceed the revenue generated and that taxes do not unnecessarily discourage productive activity.
Source Chapter
Book V, Chapter 2
Context
Smith identifies this as the fourth of his four maxims, arguing that economic efficiency in taxation is essential for maximizing revenue while minimizing the burden on the economy.
Economic Domain
General Theory