red, be (1) of composite character, partly price and
partly tax, (2) a pure price, (3) a mere fee.

The other rates (excepting for the moment the parcel rate) have all for
some specific purpose of State been fixed at a lower level than the
letter rate; but, for the most part, without any nice adjustment to the
cost of service. Consequently these subsidiary rates are not prices, and
do not contain any element of taxation.[750] They are, however, charges
made to individuals in respect of certain services performed by the
State, and fall, therefore, under the heading of fees.

The parcel rates in England and Germany may be put under the same
heading. In both cases the service is conducted at a loss, and the
charges cannot therefore be regarded as prices. In the United States
and in Canada the law provides that the rates for parcels must in all
cases be such as to yield a revenue sufficient to cover the cost of the
service, and the presumption is therefore that in those countries the
rates will partake of the nature of prices.[751]

Although there has been diversity of opinion regarding the nature of
Post Office revenue, there has been remarkable unanimity as to the
propriety of raising a net revenue for the State on the service for the
transmission of letters. In the days of high rates and relatively high
revenue it was not challenged.[752] Sir Rowland Hill's reform took away
any sort of feeling that the revenue obtained from the Post Office lay
as a burdensome tax, but the amount of surplus revenue was still so
considerable that it could fairly be regarded as containing an element
of tax.[753] It has, moreover, steadily increased, and its existence
been made the justification for claims for further reductions of
rate.[754]

The use of the Post Office for the purpose of taxation, that is, the
refusal to give away in improvements of service, or by reduction of
rates, the net surplus of revenue, is accepted by economists as
justifiable[755] and the public acquiesces. The surplus is obtained
with the minimum of sacrifice on the part of those who pay, and it would
be difficult to discover a tax in substitution which would fall as
lightly. Apart from the fact that rates higher than would be necessary
for defraying the actual cost of the service must of necessity operate
to some extent to the disadvantage of trade and commerce,[756] there is
little to urge against the raising of revenue from the Post Office,
especially as it