Finance History in United Kingdom
The primitive financial institutions of England centre round the king’s household, or, in other words, the royal economy precedes the national one. Revenue dues collected by the king’s agents, rents, or rather returns of produce, from land, and special levies for emergencies form the elements of the royal income, which gradually acquired greater regularity and consistency. There is, however, little or no evidence of any effective financial organization until we approach the 11th century. The influence exercised from Normandy, which so powerfully affected the English rulers at this time, tended towards the creation of records of revenue claims and also of a central treasury.
With the union of England and Normandy under the same head the idea of settled administrative methods was definitely fixed and became of special importance in the field of finance. The systematizing spirit, so characteristic of both the Norman and Angevin kings, produced the great institution of the exchequer (q.v.) with its judicial and administrative sides, and its elaborate forms of account and control. Even before this organization was developed the Domesday Survey (see Domesday Book)—now recognized as having a purely fiscal object (in Maitland’s words “a tax book, a geld book”)—shows the movement towards careful observation of the sources of revenue. It is clear that William I. initiated a policy which was followed by his successors, in spite of the serious difficulties of the period of anarchy during Stephen’s nominal reign. The obscure question as to the real origin of the special contrivances employed by the exchequer is, strictly speaking, irrelevant to the financial inquirer, who may be content to hold that, granting the existence of some Old English analogies, the system, as it appears in the 12th century, was a peculiar product of the conceptions as to fiscal organization formed by Norman subtlety. It is the manner in which this institution held together and focused the revenues and expenditure of the kingdom that has to be considered. The picture presented by the “Dialogue of the Exchequer” (c. 1176) is that of a comprehensive system which secured the receipt of the royal income, and provided a thorough audit of the accounts by employing processes adapted to the circumstances of the time. It is, in fact, through the description of financial institutions that it is possible to ascertain the forms of revenue possessed by the crown. The ingenuity expended on the administrative machinery of the exchequer had as its aim the increase of the king’s resources, an object in which the official class of churchmen and lawyers was deeply interested.
In order to understand the character Of English finance in the middle ages it is absolutely essential to bear constantly in mind the identification of the king with the state. Though feudalism (q.v.) was, in one of its aspects, a powerful instrument for division of political authority, it, nevertheless, in the particular form in which the Conqueror introduced it into England, enabled the fiscal rights of the crown to be established in a more definite shape than was possible under the older condition. For, in the first place, the actual property of the crown was more carefully administered as each royal manor came under the system of accounting. Again, the various claims or dues of the king took more decidedly the feudal type and received stricter legal definition. Further, the higher judicial organization assisted the expansion of court fees; while, above all, the increased authority of the state made the casual receipts (for such they were) from trade more profitable. For more information on the history of the English revenue, click here.
The history of the English financial system consists largely in the exhibition of the different fortunes of these several component parts of the exchequer receipts; for it must be remembered that the sheriff was bound to account to that tribunal for all that he should have received, and by this agency the local contributions passed into the king’s possession for the service of the state, During the century and a half that lay between the Conquest and the granting of the Great Charter the account given above holds good. The character of the ruler affected the vigour of the fiscal, as well as the general, administration. Henry I. and Henry II. secured much better results than Stephen or John; but the collection of the rent and profits of the royal manors and the feudal and other dues continued as the mainstay of revenue. Indications of change are, however, to be found. Thus the substitution of the “carucage” or plough tax for the “Danegeld” marks an advance towards direct taxation of land through its produce, and the introduction of “scutage” is not only further evidence of the same tendency, but also a step in the development of “money economy” in place of the earlier “natural economy” or system of payments in kind. The special levies or “tallages” imposed at times of need on the towns in the king’s demesne appear to have been a doubtful exercise of the royal prerogative, but scientifically they belong to the same class as the Danegeld and scutage. Perhaps the most important advance made in this period is the beginning of taxation of movables, first applied in the Saladin tithe of 1189 and, later, expanded into a general system.
In the reign of John (1199-1216) the loss of Normandy and the concession of the barons’ demands by the issue of Magna Carta rendered financial readjustments inevitable. During the long reign of Henry III. the struggle to maintain the privileges granted by the Charter acted on the fiscal system by checking the arbitrary use of tallages, and as a consequence, encouraging the regular assessment of the tax on movables, which was becoming more prominent. The fruitful idea that it was necessary to obtain the consent of the payers of taxes before the imposition operated powerfully in favour of the establishment of bodies representing the several estates. It is through the reaction of constitutional on fiscal development that the transition from feudal to parliamentary taxation in its earlier form is made. (…)
One class or “estate” occupied a peculiar position. The clergy still claimed the privilege of self-taxation, and therefore it was convocation, not parliament, that voted the tenths imposed on clerical property. In some instances much heavier charges (e.g. in 1296 one-third) were decreed by the king, but the taxation of the clergy declined in productiveness during the 14th century. By the close of the reign of Richard II. the results of the transition from feudalism to a parliamentary constitution were practically complete. In respect to finance the most important of these were: (1) The disappearance or reduction to unimportance of the feudal dues. The fact that this change occurred at, relatively speaking, so early a date is of special significance for English development. (2) The royal demesne, though it had not suffered the losses that the grants of later times inflicted on it, had also lost some of its value as a source of revenue. (3) In compensation the direct taxation of property had become a ready means of supplying the growing requirements of the administration, and the mode of levy had been reduced to a well-recognized form, unsatisfactory experiments—such as the poll tax—being withdrawn. (4) The growth of import and export duties through the “old” and “new” customs and the subsidies furnished a large part of the requisite funds. In fact, in the course of a little over three hundred years the constituent parts of the public income had, without any violent change, been completely altered in relative value and in organization.
The period of the Lancastrian kings, extending over two-thirds of the 15th century (1399-1471), is noticeable for various experiments in the system of direct taxation. The standard tax—“the tenth and fifteenth”—failed to suit the changed conditions. In consequence of the decay of some of the towns allowances had to be made to them, amounting to over 15% (£6000), which, with other deductions, lowered the yield from a “tenth and fifteenth” to £31,000. As a supplement a land tax, affecting only the large owners, was voted at the rate of 5% in 1404, and repeated with wider scope, but at the lower rate of 12⁄3%, in 1411. A house tax made its appearance in 1428. Taxes on knight’s fees and other freeholds were also tried, while in 1435 and 1450 the graduated income tax was employed. The minimum rate, 2½%, applied to incomes under £100 (or under £20 in the tax of 1450), and rose to 10% on the higher incomes. These devices are evidence of the demand for larger revenue, and also of the increasing unfitness of the existing direct taxation. Note: there is some information about the history of direct taxation here; and on the history of indirect taxation here.
It may be added that they indicate a disposition to adopt foreign models, particularly the methods of taxation in use in France and Italy. As to indirect taxation the receipts seem at first to have declined, and the subsidies were only granted for fixed terms (the victory of Agincourt gained a life grant to Henry V.). After the establishment of Edward IV. on the throne, the idea of a “tenth,” in the literal sense, was taken up and voted (1472) by the two houses as a special military provision; but it failed to bring in the required revenue, and the king had to fall back on grants of the old-established form. Extra taxes on aliens were levied under both Lancastrian and Yorkist rulers with little profit. The most original contribution of Edward IV. to fiscal policy was the “benevolence” (q.v.) or payment by wealthy subjects of sums requested by the king. Voluntary in form, these payments were, in fact, compulsory, and became in later times one of the great grievances against which parliament had to struggle.
Broader issues in finance marked the course of the Tudor period, and these were connected with the general history of the time. The era of national monarchies had arrived, necessitating the maintenance of greater military and naval forces, as well as more costly machinery of administration. External policy was affected by the set of ideas that developed into mercantilism (see Mercantile System); but so also was fiscal policy. Finance reflected the actions of the personal rule that was the characteristic of the 16th century. Within the period, however, some decided contrasts are to be found. Prudence, carried to parsimony with Henry VII., is followed by lavish prodigality in the case of Henry VIII. Elizabeth, again, presents in her reign a very different financial policy from that of either her father or her grandfather. The desire for a vigorous foreign policy, the hope of encouraging native industry, and the sentiment of retaliation against the trade regulations of other countries are found to interfere with the aim—strictly followed in earlier times—of obtaining the largest possible yield. All the different parts of the public economy were regarded as existing only in order to be utilized for the furtherance of national power. It is this more complex character in policy, coupled with the new influences, that the discovery of America, the Renaissance and the Reformation brought into operation, which gives special interest to the financial problems of the 16th century.
Taking in order the great heads of public income placed at the disposal of the sovereign, it appears that the first head of the old receipts—the crown lands—had been from time to time diminished by grants to the king’s relatives and favourites, but had also gained through resumptions and forfeitures. On the whole, the loss and gain down to the close of the 14th century was probably balanced. The revenue was, however, inelastic, and declined in relative importance. It has been said that “it was in the 15th century that the great impoverishment of the crown estate began.” The Lancastrian kings (especially Henry VI.) lost most of the lands attached to the crown through pressure of expenditure and the wholesale plunder of officials. Though the civil wars of the 15th century brought in many forfeited estates the grants of Edward IV. kept down the increase. But the chief opportunity for aggrandizement was afforded by the dissolution of the monasteries and gilds under Henry VIII. The great mass of property that passed into the royal possession in this way was in part assigned to nobles and officials, while most of the remainder was distributed in the reigns of his children. The dwindling importance of the public revenue from land and rent charges is as noticeable under the Tudors as in earlier times. In like manner the feudal dues had fallen into a very subordinate place notwithstanding the attempts made on particular occasions to enforce them with greater rigour. The force of personal monarchy exercised by the Tudors, depending as it did on popular support, tended to encourage the collection of dues which had a legal ground in preference to taxation of the community. Of similar character was the employment of the old right of purveyance (q.v.), in restraint of which a series of statutes had been passed.
Whatever possibilities of obtaining some additional revenue from the crown lands or prerogative rights may have existed in the 16th century, and these were slight, all the political and social conditions tended more and more to make the need of taxation as the principal financial resource imperative. Amongst the cases of increased calls for funds to maintain the machinery of state, the rise of prices, due to increased supplies of the precious metals, must be included as one of the chief, and its effect extends into the 17th century. It was under this influence that the old forms of revenue became less profitable and that fresh developments were necessitated. (…)
In the history of the port duties under the Tudors the first point for notice is the life grant to each of the sovereigns of the subsidies on wool, hides and leather, together with tunnage at 3s. and poundage at 5%; thus, with the hereditary customs, supplying a considerable revenue for the crown’s use. No better indication of the increased power and popularity of the monarchy could be found. The contrast with the suspicious and grudging attitude of the Plantagenet and Lancastrian parliaments is significant of the change in national sentiment. A duty on malmsey (1490) had a retaliatory rather than a fiscal aim, being directed against the Venetians who had imposed restrictions on English trade. In several later cases wine became liable to extra duties, chiefly applied to French trade in further pursuance of the policy of retaliation. Restrictions on import and export as well as the hostile measures against foreign merchants were matters of economic policy rather than finance, but they had the indirect effect of increasing the control exercised at the ports. The loss of Calais (1558) dislocated the system of the staple and cut off one centre of customs revenue; and it was also probably the cause of an important change in the mode of valuing goods for duty. For the declaration on oath of the merchant a fixed valuation was substituted and set forth in a book of rates, the first of its class (1558). Following this reform came more stringent regulations against smuggling and fraud on the part of officials. All through the Tudor period the cost of collection was unduly high. For the first six years of Elizabeth it has been estimated at one-sixth of the gross receipts.
Just as in the 14th century the subsidy had followed the “old” and “new” customs, so in the 16th the “impositions” levied by royal prerogative formed a supplement to the parliamentary subsidy; but the principal employment of this expedient occurs in the next century. Another significant indication of the future course of indirect taxation was furnished by the grants of monopolies to inventors, producers and traders. These privileges, when they affected important commodities, operated in the same way as taxes farmed out to collectors, and, though the profit to the crown was small, they enhanced prices and excited discontent. The wisdom of Elizabeth (or her ministers) was shown in the promise of redress after the hostile debate of 1601.
From one point of view it may fairly be said that the great struggle of the Stuart kings with the parliament centred round financial issues. It is, at all events, beyond dispute that questions of taxation were the chosen ground of conflict. Taking the period from the accession of James I. to the opening of the Civil War (1603-42) it appears that the legal basis of indirect taxation was tested for the port duties in the “Great Case of Impositions” (known as Bates’ case, see Bates, John), while that of direct taxation was considered in the even more famous “Ship Money” case (for ever associated with the name of Hampden). In parliament the debates deal with impositions, monopolies, the grounds for voting subsidies, and the proper application of the funds granted; in fact, with nearly all the financial questions of the time. Notwithstanding these difficulties and disputes the financial system shows evident signs of expansion and adaptation to the needs of the state.
The direct grants of the parliaments of James I. far exceeded those of earlier periods (in 1606 six “fifteenths and tenths,” three lay and four clerical subsidies), but the efforts to extend the other sources of revenue by the exercise of the prerogative naturally reacted on this spirit of liberality. The last “fifteenth and tenth” was voted in 1624, from which date this old-established form disappears, and the subsidy alone is used. In spite of Charles I.’s high-handed policy five subsidies were voted after the Petition of Right had been accepted, and even the Long Parliament made similar grants. Almost at the outbreak of the Civil War it also gave the king a graduated capitation tax. Other modes of direct taxation were used without parliamentary sanction. The collection of the antiquated feudal dues was enforced through the special courts (particularly the Star Chamber) with a rigour long unknown; James had tried the French device of a “tariff of honors.” Both kings employed 462 the “benevolence” until the Petition of Right made such a levy illegal. But by far the most serious innovation was the collection of the “ship money,” a course forced on Charles by his determination not to meet the representatives of the nation. The writs “embodied the ultimate expression of the ingenuity of the king’s advisers in the invention of means to enable him to rule without a parliament.” The first writs secured over £100,000, and were followed by five further issues (1634-1639) bringing in an average return of £200,000 or about three lay subsidies. Like the “benevolence,” the ship money was declared to be illegal (1641).
The contest respecting monopolies, settled by Elizabeth’s withdrawal, was revived under James I., and had to be finally closed by the Statute of Monopolies (1624), declaring such grants to be utterly void. Certain exceptions (as in the case of the soap-boilers) permitted the raising of revenue by what was in fact a rudimentary excise, and plans for a general excise were discussed, especially as a substitute for the feudal dues, though they were not reduced to practice. In the earlier 17th century the customs show a steady increase. From £127,000 in 1604 they rose to nearly £500,000 in 1641. This fourfold increase was due in part to the growth of English trade, but it was also influenced by the adoption of new “Books of rates” in 1608 and 1635, fixing higher valuations, and by the inclusion of new commodities with definite duties. Wine, currants (the subject of controversy in Bates’ case) and tobacco are particularly noticeable. Sugar also appears as a contributory. An interesting development was the adoption on a larger scale of the “farming” system, an evident imitation from France. A distinction was made between the “great,” the “petty” and the “sugar” farms, and opportunities for gain were afforded to the officials. On the constitutional side the life grant of subsidies, made in accordance with Tudor usage to James, was temporarily withheld from Charles, a restriction which his own overbearing policy led the parliament to maintain. Practically, the whole customs revenue between 1628 and 1640 was raised by the use of the prerogative without any parliamentary sanction. The Tunnage and Poundage Act of 1641 pronounced definitely against the legality of any extra parliamentary customs and thus closed another of the constitutional problems of finance.
In the progress from the Conquest to the crisis of the Great Rebellion there is noticeable a practically complete shifting of the classes of revenue. The king had ceased “to live of his own”; the royal demesne and the prerogative rights included in feudalism had become very subordinate. The direct taxation of property and income, and the indirect taxation on imported or exported commodities became the principal forms of receipt.
In the long course of English financial history the nearest approach to the new departure and an abandonment of old devices is found at the time of the Civil War and Commonwealth. The actual outlines of the now existing system made their appearances, while the older portions of the revenue—particularly the survivals of feudalism—are eliminated. Thus the Civil War and the Interregnum (1642-60) may be regarded as marking a watershed in the financial history of the country. At the beginning of the struggle both sides had to rely on voluntary contributions. Plate and ornaments were melted down and useful commodities were furnished by the adherents of the king and by those of the parliament. As holding possession of London and the central organization the parliament voted subsidies and a poll tax. Such imports could hardly be levied with success and new forms became necessary. (…)
The Revolution of 1688 may be regarded both on its constitutional and financial sides as the completion of the work of the Long Parliament. In the latter respect its chief effects were:
- the transfer of the administration of the finances from the king’s nominees to officials under parliamentary control,
- the consequent application of the revenue to the purposes designated by parliamentary appropriation,
- the rapid expansion of the various kinds of revenue, particularly the indirect taxes,
- the rise and growth of the national debt, combined with the creation of an effective banking system.
- (The greater part of the 18th century was occupied with the working out of these results).
The government of William III. had to face the expenses of a great war and to allay discontent at home. As a preliminary step to the necessary settlement of the revenue a return was prepared, showing the tax receipts at over £1,800,000 and the peace expenditure at about £1,100,000. Parliament accepted the view that £1,200,000 per annum would suffice for the ordinary requirements of the kingdom. It, further, introduced the system of the Civil List (q.v.) and assigned £600,000 for the fixed payments placed under that head, leaving the remainder to be appropriated for the other needs of the state. As the “hearth money” had proved to be a very unpopular charge, it was, in spite of its yield (£170,000), given up. The temporary excise duties were voted for “their majesties’ lives” and the customs for a limited term.
These branches of revenue were altogether insufficient to meet the pressure of the war outlay, and in consequence new heads of taxation—or old ones revived—came into use. A series of poll and capitation taxes were imposed between 1689 and 1698, but were after that date abandoned for the same reason as that for the repeal of the hearth money. The monthly assessment was tried in 1688; then came an income tax followed by “twelve months’” assessments in 1690 and 1691. The way was thus prepared for the property tax of 1692, imposing a rate of 4s. in the pound on real estate, offices and personal property. The old difficulties of securing returns made the tax chiefly one on land. It was under the name of “the land tax” that it was generally known. The 4s. rate brought in £1,922,712, a return which declined in the following years. To meet this a fixed quota of nearly half a million (a 1s. rate) was adopted in 1697, the amount to be apportioned in specified sums to the several counties and towns. The framework of the tax remained without substantial change till 1798, the time of Pitt’s redemption scheme.
In 1696 houses were taxed 2s. each, with higher rates for extra windows. The beginning of the “window tax,” licences on pedlars, and a temporary tax on the stocks of companies complete the imposts of this kind. Stamp duties—imitated from Holland—were adopted in 1694 and extended in 1698: they mark the beginnings of the modern duties on transactions and the “death duties.” Large additions were made to the excise. Breweries and distilleries were placed under charge, and such important commodities as salt, coal, malt, leather and glass were included in the list of taxable articles, but the two last mentioned were soon relieved for the time. The customs rates were also increased. In 1698 the general 5% duty was raised by the new subsidy to 10%. French goods became liable to surtaxes, first of 25%, afterwards of 50%; those of other countries had to pay similar charges of smaller amount. Spirits, wines, tea and coffee were taxed at special rates. How great was the expansion of the fiscal system may be best realized from the fact that during the comparatively short reign of William III. (1689-1702) the land tax produced £19,200,000, the customs £13,296,000, and the excise £13,650,000, or altogether £46,000,000. In the last year of the reign, the opening one of the 18th century, the returns from these taxes respectively were: land tax (at 2s.), £990,000, customs £1,540,000, excise £986,000, or a total exceeding three and a half millions. The removal of the regular export duties in respect of (a) domestic woollen manufactures, (b) corn, was the only alleviation of taxation, and in both cases it was due to special reasons of policy.
Quite as remarkable as the growth of revenue is the sudden appearance of the use of public loans. In earlier periods a ruler had accumulated treasure (Henry VII. left £1,800,000) or had pledged “his jewels or the customs or occasionally the persons of his friends for the payment” of his borrowings. Edward III.’s dealings with the Florentine bankers are well known; but it was only after the Revolution that the two conditions essential for a permanent public debt were realized, viz.: (1) the responsibility of the government to the people, and (2) an effective market for floating capital. At the close of the war in 1697 a debt of £21,500,000 had been incurred, over £16,000,000 of which remained due at William III.’s death. Connected with the public debt is the foundation of the Bank of England (see Banks and Banking), which more and more became the agent for dealing with the state revenue and expenditure; though the exchequer continued to exist until 1834 as a real, even if antiquated institution.
Thus it is clear that by the end of the 17th century the new influences which date from the Civil War had brought into being all the elements of the modern financial system. Expenditure, revenue, borrowing to meet deficiencies are all, in a sense, developed into their present-day form. Increase in amount and some refinements in procedure, combined with improved views of public policy, are the only changes that occur later on.
Regarded broadly, the 18th and 19th centuries exhibit several distinct periods with definite financial aspects. In the ninety years from the death of William III. (1702) to the outbreak of the Revolutionary War with France (1793) there are four serious wars, covering nearly thirty-five years. There is the long peace administration of Walpole, and there are the shorter intervals of rest following each of the contests. From the beginning of the war with the French Republic to the year of Waterloo there is a nearly unbroken war time of over twenty years. The forty years’ peace is closed by the Crimean War (1854-56); and another forty years of peace ends with the South African War (1899-1902). During this time the older mercantilism passes into protectionism; and this, again, gives way before the gradual adoption of the free trade policy. At each time of war, taxation (particularly in the indirect form) and debt increase. Financial reform is connected with the maintenance of peace. Among the great financial ministers Walpole, the younger Pitt, Peel and Gladstone are conspicuous; while Huskisson’s services in the kindred field of economic policy deserve special notice in their financial bearing. (…)
The revolutionary and Napoleonic wars mark an important stage in English finance. The national resources were strained to the utmost, and the “whip and spur” of taxation was used on all classes of the community. In the earlier years of the struggle the expedient of borrowing enabled the government to avoid the more oppressive forms of charge; but as time went on every possible expedient was brought into play. One class of taxes had been organized during peace—the “assessed taxes” on houses, carriages, servants; horses, plate, &c. These duties were raised by several steps of 10% each until, in 1798, their total charge was increased threefold (for richer persons four- or fivefold) under the plan of a “triple assessment.” The comparative failure of this scheme (which did not bring in the estimated yield of £4,500,000) prepared the way for the most important development of the tax system—the introduction of the income-tax in 1798. Though a development of the triple assessment, the income-tax was also connected with the permanent settlement of the land tax as a redeemable charge.
It is possible to trace the progress of direct taxation from the scutage of Norman days through “the tenth and fifteenth,” the Tudor “subsidies,” the Commonwealth “monthly assessments,” and the 18th century land tax, to the income-tax as applied by Pitt, and, after an interval of disuse, revived by Peel (1842). The immediate yield of the income-tax was rather less than was expected (£6,000,000 out of £7,500,000); but by alteration of the mode of assessment from that of a general declaration to returns under the several schedules, the tax became, first at 5%, afterwards at 10%, the most valuable part of the revenue. In 1815 it contributed 22% of the total receipts (i.e. £14,600,000 out of £67,000,000). If employed at the beginning of the war, it would probably have obviated most of the financial difficulties of the government. The window tax, which continued all through the 18th century, had been supplemented in the American War by a tax on inhabited houses (one of Adam Smith’s many suggestions), a group to which the assessment taxes were naturally joined. During the 18th century the probate duty had been gradually raised, and in 1780 the legacy duty was introduced; but these charges were moderate in character and did not affect land.
Though the direct and quasi-direct taxes had been so largely increased, their growth was eclipsed by that of the excise and customs. With each succeeding year of war new articles for duties were detected and the rates of old taxes raised. The maxim, said to have guided the financiers of another country—“Wherever you see an object, tax it”—would fairly express the guiding policy of the English system of the early 19th century. Eatables, liquors, the materials of industry, manufactures, and the transactions of commerce had in nearly all their forms to pay toll. To take examples:—salt paid 15s. per bushel; sugar 30s. per cwt.; beer 10s. per barrel (with 4s. 5d. per bushel on malt and a duty on hops); tea 96% ad valorem. Timber, cotton, raw silk, hemp and bar iron were taxed, so were leather, soap, glass, candles, paper and starch. In spite of the need of revenue, many of the customs duties were framed on the protective system and thereby gave little returns; e.g. the import duty on salt in 1815 produced £547, as against £1,616,124 from excise; pill-boxes brought in 18s. 10d., saltpetre 2d., with 1d. for the war duties.
The course of the war taxation was marked by varied experiments. Duties were raised, lowered, raised again, or given some new form in the effort to find additional revenue. Some duties, e.g. that on gloves, were abandoned as unproductive; but the conclusion is irresistible that the financial system suffered from over-complication and absence of principle. In the period of his peace administration Pitt was prepared to follow the teaching of The Wealth of Nations. The strain of a gigantic war forced him and his successors to employ whatever heads of taxation were likely to bring in funds without violating popular prejudices. Along with taxation, debt increased. For the first ten years the addition to it averaged £27,000,000 per annum, bringing the total to over £500,000,000. By the close of the war period in 1815 the total reached over £875,000,000, or a somewhat smaller annual increase—a result due to the adoption of more effective tax forms, and particularly the income tax. The progress of English trade was another contributing agency towards securing higher revenue. The import of articles such as tea advanced with the growing population; so that the tea duty of 96% yielded in 1815 no less than £3,591,000. It is, however, true that by the year just mentioned the tax system had reached its limit. Further extension (except by direct confiscation of property) was hardly possible. The war closed victoriously at the moment when its prolongation seemed unendurable. (1)
Resources
Notes and References
- Encyclopedia Britannica (11th Edition)
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