ll
be curtailed by the tax; and not by this tax particularly, but by any
other which should raise an equal amount.

The error of Adam Smith proceeds in the first place from supposing, that
all taxes paid by the farmer must necessarily fall on the landlord, in
the shape of a deduction from rent. On this subject I have explained
myself most fully, and I trust that it has been shewn, to the
satisfaction of the reader, that since much capital is employed on the
land which pays no rent, and since it is the result obtained by this
capital which regulates the price of raw produce, no deduction can be
made from rent; and consequently either no remuneration will be made to
the farmer for a tax on wages, or if made, it must be made by an
addition to the price of raw produce.

If taxes press unequally on the farmer, he will be enabled to raise the
price of raw produce, to place himself on a level with those who carry
on other trades; but a tax on wages, which would not affect him more
than it would affect any other trade, could not be removed or
compensated by a high price of raw produce; for, the same reason which
should induce him to raise the price of corn, namely, to remunerate
himself for the tax, would induce the clothier to raise the price of
cloth, the shoemaker, hatter, and upholsterer, to raise the price of
shoes, hats, and furniture.

If they could all raise the price of their goods, so as to remunerate
themselves, with a profit, for the tax; as they are all consumers of
each other's commodities, it is obvious that the tax could never be
paid; for who would be the contributors if all were compensated?

I hope then that I have succeeded in shewing, that any tax which shall
have the effect of raising wages, will be paid by a diminution of
profits, and therefore that a tax on wages is in fact a tax on profits.

This principle of the division of the produce of labour and capital
between wages and profits, which I have attempted to establish, appears
to me so certain, that excepting in the immediate effects, I should
think it of little importance whether the profits of stock, or the wages
of labour, were taxed. By taxing the profits of stock, you would
probably alter the rate at which the funds for the maintenance of labour
increase, and wages would be disproportioned to the state of that fund,
by being too high. By taxing wages, the reward paid to the labourer
would also be disproportioned to the state of that fund, by