THURSDAY, MARCH 9, 1871.

Wanganui Herald, Volume IV, Issue 1112, 9 March 1871, Page 2

THURSDAY, MARCH 9, 1871.

The revenue is falling off, and Mr Stafford is now able to state that Mr Vogel over-estimated it in his last budget by £90,000.. It. is worthy of note that a careful perusal of Hansard does not show that Mr Stafford in the debate on the Financial Statement did express his belief that the Treasurer was too sanguine in his anticipations of revenue. Mr Vogel based his estimate on the past and the growing prosperity of the country, supposing us to have comparative immunity from Maori troubles. There will probably be a large deficiency, which will have to be made up by borrowed money. I\ Tow if the revenue of thecblony was any criterion of its prosperity, there would be much ground for despair. But it is not so, as a glance at the exports and imports will at once demonstrate. With a declining revenue, we are actually exporting more and importing less. This is a curious fact, as it shows that an increase of wealth brings a decrease of revenue. The value of the several exports from the different ports of, the colony during 1870 was £4,819,148. In the previous year, 1869, they amounted to £4223,923, Bhowing an increase in 18700f£595',225'. This increase has taken place principally in agricultural industries, as there has been a falling off in the quantity of gold exported of £206,470. If the export of gold had been the same in 1870 as it was in 1869, the increase of exports in the one year over the other would amount to £801,695. This is satisfactory. Let us now see how the imports stand. In 1870 the imports reached a sum of .£4,639,015 against £4,976,126 in 1869, showing a decrease of £337,111. The balance of trade in 1870 was in our favor by £180,133, while in 1869 it was against us by £752,203, or about three quarters of a million. During the year 1870 we lived within our means, and sent out of the country £180,000 more than we bought from other countries. In the year previous, however, we went beyond our means by purchasing £752,000 worth of goods more than we sold fl%,falling off in the imports, of course' accounts for the falling off in the main source of revenue, the Customs. The increase of exports, and the balance of trade being in our favor, show the progress of the colony. If W e proserve the balance of trade in our favor, the colony must increase in wealth • and this suggests a consideration as to taxation. It is no new principle of the political economists that indirect taxation by means of customs' duties is unsound in theory. The revenue clearly

ought to increase with tlic wealth of the country, hut it is obvious from what we have pointed out that it actually docs the reverse. The less we import the more we draw upon our resources ; and hence the decline of the import duties follows upon the development of our industries and the corresponding increase of wealth and prosperity As our financiers find that the elasticity of the customs will no longer respond, to their demands, they will have to seek for revenue in other quarters, and we should not be surprised at finding before many years are past that the land will be made to yield a considerable portion of the revenue, with perhaps Mr Stafford's old threat fulfilled of the obnoxious income tax. When the cry is going forth that the revenue is falling off, it is consoling to turn to the exports and to find that the foundations of trade and industry are being firmly laid. The decline of the revenue, with all the facts before us, simply shows that the " incidence of taxation" is not equal to the reflection of wealth. Taxation is not yet understood as a science ; and the empirical mode of treating it is more likely to bo wrong in a new country passingthrough vicissitudes, than in such a country as England where the channels of commerce are already clearly defined.