cultivator of No. 3 pays neither rent nor tax, he would in no way
be enabled to raise the price of the commodity produced. A tax on rent
would not discourage the cultivation of fresh land, for such land pays
no rent, and would be untaxed. If No. 4 were taken into cultivation,
and yielded 150 quarters, no tax would be paid for such land; but it
would create a rent of ten quarters on No. 3, which would then commence
paying the tax.

A tax on rent, as rent is constituted, would discourage cultivation,
because it would be a tax on the profits of the landlord. The term rent
of land, as I have elsewhere observed, is applied to the whole amount of
the value paid by the farmer to his landlord, a part only of which is
strictly rent. The buildings and fixtures, and other expenses paid for
by the landlord, form strictly a part of the stock of the farm, and must
have been furnished by the tenant, if not provided by the landlord. Rent
is the sum paid to the landlord for the use of the land, and for the use
of the land only. The further sum that is paid to him under the name of
rent, is for the use of the buildings, &c., and is really the profits of
the landlord's stock. In taxing rent, as no distinction would be made
between that part paid for the use of the land, and that paid for the
use of the landlord's stock, a portion of the tax would fall on the
landlord's profits, and would therefore discourage cultivation, unless
the price of raw produce rose. On that land, for the use of which no
rent was paid, a compensation under that name might be given to the
landlord for the use of his buildings. These buildings would not be
erected, nor would raw produce be grown on such land, till the price at
which it sold would not only pay for all the usual outgoings, but also
for this additional one of the tax. This part of the tax does not fall
on the landlord, nor on the farmer, but on the consumer of raw produce.

There can be little doubt, but that if a tax were laid on rent,
landlords would soon find a way to discriminate between that which was
paid to them for the use of the land, and that which was paid for the
use of the buildings, and the improvements which were made by the
landlord's stock. The latter would either be called the rent of house
and buildings, or in all new land taken into cultivation such buildings
and improvements would be made by the tenant, and not by the landlord.
The landlord's capital might indeed be really employed