000 comes from the Postal Services; and even
if these services were controlled by Ireland, it may be taken that the
rates charged will be the same as in Great Britain. Of the remaining
L2,900,000 nearly one-half comes from income tax. It has already been
pointed out that its yield cannot be materially increased. There are
only two ways by which an Irish Chancellor might attempt such a task. He
might raise the rate of income tax or he might lower the exemption
limit. The former course would almost certainly be followed by two
equally undesirable results. So far as the tax continued to be paid in
Ireland it would fall with crushing force on the already
heavily-burdened agricultural industry. Still, from the point of view of
the Exchequer, there might be some additional revenue on this account.
On the other hand, there would be a check to the investment of capital
in Ireland--and no country needs capital more--and a powerful temptation
to transfer it where the tax would be lower. It may be seriously
questioned, therefore, whether any increase in the income tax above the
British rate is practicable. The other alternative, namely, the lowering
of the exemption limit, would be so unpopular that no Irish Chancellor
is ever likely to consider it seriously.

Passing from the consideration of revenue it is necessary to examine the
relation of present revenue to present expenditure. The first table in
the present article shows that the ascertainable expenditure for Irish
purposes in 1910-11 was about L1,400,000 more than the revenue. To this
expenditure must be added about L300,000 for the State Share of the
benefits under Part I. of the National Insurance Act, about L50,000 in
respect of Part II., and about L100,000 for cost of administration of
both parts, increasing the immediate deficit to about L1,550,000. This
calculation, moreover, includes no charge against Irish revenue on
account of Imperial Services--navy and army; National Debt, interest and
management; the diplomatic services, and so forth. The equity of such
payments has been consistently recognised in the two Bills and the three
financial schemes submitted by Mr. Gladstone. However moderate the scale
of contribution it would in the present case double or treble the margin
between Irish revenue and Irish expenditure for local purposes. If, for
example, the precedent of the 1886 Bill were followed, and Ireland
charged with a contribution for Imperial services in propor