, not that corn is given by other countries to Spain for gold, but
that cloth, sugar, hardware, are by those countries given in exchange
for that metal.

CHAPTER XXVII.

TAXES PAID BY THE PRODUCER.

M. Say greatly magnifies the inconveniences which result if a tax on a
manufactured commodity is levied at an early, rather than at a late
period of its manufacture. The manufacturers, he observes, through whose
hands the commodity may successively pass, must employ greater funds in
consequence of having to advance the tax, which is often attended with
considerable difficulty to a manufacturer of very limited capital and
credit. To this observation no objection can be made.

Another inconvenience on which he dwells is, that in consequence of the
advance of the tax, the profits on the advance also must be charged to
the consumer, and that this additional tax is one from which the
treasury derives no advantage.

In this latter objection I cannot agree with M. Say. The state, we will
suppose, wants to raise _immediately_ 1000_l._ and levies it on a
manufacturer, who will not, for a twelve-month, be able to charge it to
the consumer on his finished commodity. In consequence of such delay, he
is obliged to charge for his commodity an additional price, not only of
1000_l._ the amount of the tax, but probably of 1100_l._, 100_l._ being
for interest on the 1000_l._ advanced. But in return for this additional
100_l._ paid by the consumer, he has a real benefit, inasmuch as his
payment of the tax which Government required immediately, and which he
must finally pay, has been postponed for a year; an opportunity,
therefore, has been afforded to him of lending to the manufacturer, who
had occasion for it, the 1000_l._ at 10 per cent., or at any other rate
of interest which might be agreed upon. Eleven hundred pounds payable at
the end of one year, when money is at 10 per cent. interest, is of no
more value than 1000_l._ to be paid immediately. If Government delayed
receiving the tax for one year till the manufacture of the commodity
was completed, it would, perhaps, be obliged to issue an Exchequer bill
bearing interest, and it would pay as much for interest as the consumer
would save in price, excepting, indeed, that portion of the price which
the manufacturer might be enabled, in consequence of the tax, to add to
his own real gains. If, for the interest of the Exchequer bill,
Government would have paid 5 per cent., a tax o