PRINCIPLES OF TAXATION. 55 



without argument. Adam Smith held to the opinion, " founded," 

 as he says, " on the experience of all nations, that the certainty of 

 what each individual ought to pay is, in taxation, of so great im- 

 portance that a very considerable degree of inequality is not near 

 so great an evil as a small degree of uncertainty." The evil of 

 uncertainty does not, however, often characterize the tax systems 

 of the United States, except in the case of taxation by the Federal 

 Government of imports, when rates (customs) are sometimes held 

 for considerable periods in abeyance by reason of political an- 

 tagonisms of legislators. One of the most remarkable exam- 

 ple of this occurred during the months from December, 1893, to 

 August, 1894, when the uncertainty as to the prospective rates on 

 imported merchandise occasioned great stagnation of business in 

 the United States, with inevitable great contingent losses. An- 

 other even more striking illustration of the evils of uncertainty 

 in taxation is to be found in the recent (1897) proposition to sub- 

 ject merchandise, imported in strict conformity with established 

 laws and rates at the time of importation, to the retroactive inci- 

 dence of increased taxes, not certain but prospective in respect to 

 rates, and not enacted or embodied in the form of statute laws. 

 Such action is in the nature of an arbitrary fine or penalty, and 

 not taxation, and probably does not find a parallel in the history 

 of any civilized nation, and would not now be tolerated in any of 

 the most despotic governments of Europe. 



The term proportional, which is largely used in constitutional 

 provisions and in statutes relating to taxation, has, however, a 

 meaning so much broader and of such greater significance than 

 is generally attributed to it by law-makers and even law inter- 

 preters, that it is worth while to institute an inquiry and endeavor 

 to understand clearly what it does mean. Scientifically consid- 

 ered, it means the making of the burden of taxation equal upon all 

 subjects of immediate competition. This principle is one of the 

 prime essentials of taxation, and when it is violated the act of 

 taking, or the enforced contribution, is not entitled to be consid- 

 ered taxation, but becomes at once an arbitrary spoliation or con- 

 fiscation. Thus, to illustrate: Suppose it were proposed to tax 

 the stock in trade of red-haired men five per cent, and those of 

 red-nosed men ten per cent ; or, as was provided in the income- 

 tax law enacted by the Congress of the United States of 1894, 

 which exempted incomes below four thousand dollars per annum 

 from taxation and taxed all above that sum two per cent ; or to 

 do as actually once was done in England, under an income-tax 

 law enacted in 1691, tax Catholics at rates double those imposed 

 on Protestants ; it seems clear that such transactions could not 

 involve any principle or be regarded in any other light than the 

 mere arbitrary and despotic exercise of power ; or the making of 



