256 ADAM SMITH. 



changes hands by death, then both the Komans in 

 Augustus' time, the Dutch, the English, and all feudal 

 countries, in taxing the casualties, intentionally levied 

 imposts upon capital. The feudal perquisites on alien- 

 ation operated when property was sold. Stamp duties 

 on purchases have with us the same operation. Taxes 

 on succession fall on the owner ; taxes on sale fall on 

 the seller, because he is the needy person and must 

 pay. The Spanish Alcavala seems to be of this class, 

 though Dr. Smith does not here consider it. All taxes 

 on capital are unthrifty, because they diminish the fund 

 for employing labour and machinery, or increasing pro- 

 duction. Living upon the principal, is accordingly a 

 common expression to denote the usual spendthrift 

 course. 



It must be observed that Dr. Smith in this, as in 

 other parts of his work, leaves out of view one impor- 

 tant circumstance when speaking of capitalists, and also 

 of labourers, shifting their stock or their labour to new 

 channels of employment when a burthen is laid on 

 them, or any other demand is made which tends to 

 lower their gains. They very often linger on a long 

 time, perhaps all their lives, in order to avoid the dis- 

 agreeable consequences of the change ; and because 

 they have become expert in one employment and could 

 not soon be equally so in another. What they would 

 pay to avoid a risk or a disagreeable change of em- 

 ployment or business, may fairly be reckoned the dif- 

 ference of the two in value to them, according to an 

 argument often used by Dr. Smith, and this price they 

 pay for continuing in their former business or occupa- 

 tion. It is also to be observed that Dr. Smith, when 

 he speaks of the tax often being thrown on the con- 

 sumer, forgets the important consideration that the 

 power of so throwing it depends on the condition of 

 the market. When the demand is rising, or even sta- 

 tionary if steady, the tax may be thrown on the con- 

 sumer ; when the market is falling, or is fluctuating, 



