An inquiry into the nature and causes of the wealth of

735

Adam Smith

It is not very easy to understand why it should be more difficult

for the maltster to get back eighteen shillings in the advanced price

of his malt, than it is at present for the brewer to get back twenty-

four or twenty-five, sometimes thirty shillings, in that of his li-

quor. The maltster, indeed, instead of a tax of six shillings, would

be obliged to advance one of eighteen shilling upon every quarter

of malt. But the brewer is at present obliged to advance a tax of

twenty-four or twentyfive, sometimes thirty shillings, upon every

quarter of malt which he brews. It could not be more inconve-

nient for the maltster to advance a lighter tax, than it is at present

for the brewer to advance a heavier one. The maltster does not

always keep in his granaries a stock of malt, which it will require a

longer time to dispose of than the stock of beer and ale which the

brewer frequently keeps in his cellars. The former, therefore, may

frequently get the returns of his money as soon as the latter. But

whatever inconveniency might arise to the maltster from being

obliged to advance a heavier tax, it could easily be remedied, by

granting him a few months longer credit than is at present com-

monly given to the brewer.

Nothing could reduce the rent and profit of barley land, which

did not reduce the demand for barley. But a change of system,

which reduced the duties upon a quarter of malt brewed into beer

and ale, from twentyfour and twenty-five shillings to eighteen shil-

lings, would be more likely to increase than diminish that de-

mand. The rent and profit of barley land, besides, must always be

nearly equal to those of other equally fertile and equally well cul-

tivated land. If they were less, some part of the barley land would

soon be turned to some other purpose; and if they were greater,

more land would soon be turned to the raising of barley. When

the ordinary price of any particular produce of land is at what

may be called a monopoly price, a tax upon it necessarily reduces

the rent and profit of the land which grows it. A tax upon the

produce of those precious vineyards, of which the wine falls so

much short of the effectual demand, that its price is always above

the natural proportion to that of the produce of other equally

fertile and equally well cultivated land, would necessarily reduce

the rent and profit of those vineyards. The price of the wines be-

ing already the highest that could be got for the quantity com-

monly sent to market, it could not be raised higher without di-

minishing that quantity; and the quantity could not be dimin-

ished without still greater loss, because the lands could not be

turned to any other equally valuable produce. The whole weight

of the tax, therefore, would fall upon the rent and profit; properly

upon the rent of the vineyard. When it has been proposed to lay

any new tax upon sugar, our sugar planters have frequently com-

plained that the whole weight of such taxes fell not upon the con-

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736

The Wealth of Nations

sumer, but upon the producer; they never having been able to

raise the price of their sugar after the tax higher than it was before.

The price had, it seems, before the tax, been a monopoly price;

and the arguments adduced to show that sugar was an improper

subject of taxation, demonstrated perhaps that it was a proper

one; the gains of monopolists, whenever they can be come at,

being certainly of all subjects the most proper. But the ordinary

price of barley has never been a monopoly price; and the rent and

profit of barley land have never been above their natural propor-

tion to those of other equally fertile and equally well cultivated

land. The different taxes which have been imposed upon malt,

beer, and ale, have never lowered the price of barley; have never

reduced the rent and profit of barley land. The price of malt to the

brewer has constantly risen in proportion to the taxes imposed

upon it; and those taxes, together with the different duties upon

beer and ale, have constantly either raised the price, or, what comes

to the same thing, reduced the quality of those commodities to

the consumer. The final payment of those taxes has fallen con-

stantly upon the consumer, and not upon the producer.

The only people likely to suffer by the change of system here

proposed, are those who brew for their own private use. But the

exemption, which this superior rank of people at present enjoy,

from very heavy taxes which are paid by the poor labourer and

artificer, is surely most unjust and unequal, and ought to be taken

away, even though this change was never to take place. It has prob-

ably been the interest of this superior order of people, however,

which has hitherto prevented a change of system that could not

well fail both to increase the revenue and to relieve the people.

Besides such duties as those of custom and excise above men-

tioned, there are several others which affect the price of goods

more unequally and more indirectly. Of this kind are the duties,

which, in French, are called peages, which in old Saxon times were

called the duties of passage, and which seem to have been origi-

nally established for the same purpose as our turnpike tolls, or the

tolls upon our canals and navigable rivers, for the maintenance of

the road or of the navigation. Those duties, when applied to such

purposes, are most properly imposed according to the bulk or

weight of the goods. As they were originally local and provincial

duties, applicable to local and provincial purposes, the adminis-

tration of them was, in most cases, entrusted to the particular

town, parish, or lordship, in which they were levied; such com-

munities being, in some way or other, supposed to be accountable

for the application. The sovereign, who is altogether unaccount-

able, has in many countries assumed to himself the administra-

tion of those duties; and though he has in most cases enhanced

very much the duty, he has in many entirely neglected the applica-

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