§ More than one-half of the war taxation has thus fallen on the Income Tax. But that does not show adequately the amount of the burden which has been borne by the Income Tax payer. If we add up the extra amount, which during the war has 253 been contributed by the Income Tax payer, and the amount contributed by the indirect taxpayer, the amounts come out as follows: the Income Tax payer has paid £39,884,000, and the indirect taxpayer £31,962,000; so that the Committee will see that the Income Tax payer has paid nearly £8,000,000 more towards the cost of the war than has been extracted from the pockets of the indirect taxpayer.
§
But this, I think, does not really fully describe the extent of the burden. The indirect taxation has been spread over seven different articles, and is on this account less burdensome than the direct taxation which has all been imposed upon one subject so that the rate has been nearly doubled. It must also be remembered—what is very often forgotten in discussing these matters—that the Income Tax payer is also a very large payer of indirect taxation. When we hear people discussing the respective burdens on the direct taxpayer and on the indirect taxpayer, that fact is often lost sight of. I think, in considering the burdens which fall upon the shoulders of the taxpayer, it ought to be remembered that a very large share of the indirect taxation falls upon the direct taxpayer. I am expressing my own opinion only, but, in my opinion, the most heavily burdened person, according to his means, is the small payer of Income Tax. Therefore, I consider that the Income Tax payer has the first claim for consideration. But more than that. The importance of getting the Income Tax back to a lower figure than that at which it stands at present can hardly be exaggerated, having regard to the general interests of the country. Mr. Gladstone once said, and said truly—
The Income Tax is a fiscal reserve available for the defence and salvation of the country.
I quite agree, and I think everybody will agree, with that view of Mr. Gladstone's. He went on—
It is, therefore, necessary to get it down to a figure as speedily as possible which will enable us to raise it at any moment of sudden emergency.
May I say also that the Income Tax is more often "commandeered" than any
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other tax. To make up any deficit, or to meet any sudden emergency, it is the Income Tax payer who is at once called upon.