WEALTH OF NATIONS. 185 



increased in proportion, and hence the total inadequacy 

 of the rents compelled the State to provide for the go- 

 vernment in all its branches by the levying of money 

 from the people. This gave rise to the modern System 

 of Taxation. 



Part 2. Taxes imposed upon the people of any coun- 

 try, must necessarily fall, either upon the rent of land, 

 the profits of stock, or the wages of labour ; and a tax 

 may fall on one or more of these three great branches of 

 the income of the community. Hence the subject divides 

 itself into four heads, as taxes are intended to fall upon 

 rents, profits, wages, or on all indiscriminately, I say, are 

 intended so to fall, because we shall presently see that 

 the incidence of an impost may be very different from 

 that which its authors intended it should be. But there 

 are four leading principles which apply to all taxes what- 

 ever, and which must in considering the merits of any 

 given tax be kept always in view. First. All the subjects 

 of a State should be called upon to contribute as nearly 

 as possible in proportion to their several means or in- 

 comes. Secondly. Each individual should be taxed ac- 

 cording to a known and certain, and not an arbitrary 

 rule. Thirdly. Every tax should be levied in the time 

 and manner most likely to suit the convenience of the 

 contributors. Fourthly. Every tax should be so con- 

 trived as to take and to keep out of the people's pockets 

 as little as possible beyond what goes into the coffers of 

 the State. A tax may depart from this last principle in 

 four ways : by requiring too large a number to collect and 

 manage it; or by obstructing the people's industry and 

 so injuring the fund of payment; or by encouraging 

 smuggling and thus increasing the price of commodities, 



