On the principles of political economy, and taxation by David Ricardo

Author:David Ricardo
Language: eng
Format: epub
Publisher: John Murray
Published: 1821-03-25T05:00:00+00:00

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CHAPTER XVII.

TAXES ON OTHER COMMODITIES THAN RAW PRODUCE.

On the same principle that a tax on corn would raise the price of com, a tax on any other commodity would raise the price of that commodity. If the commodity did not rise by a sum equal to the tax, it would not give the same profit to the pro-ducer which he had before, and he would remove his capital to some other employment.

The taxing of all commodities, whether they be necessaries or luxiuies, will, while money remains at an unaltered value, raise their prices by a sum at least equal to the tax*. A tax on the manufac*

* It^ is obfenred by M* Say, ** that a manufacturer is not enabled to make the consumer pay the whole tax levied on his commodity, because its increased price will diminish its con« sumption.** Should this be the case, should the consumption be dimmished, will not the supply also speedily be diminished ? ' Why should the manufacturer continue in the trade, if his pro* fits are below the general level? M. Say appears here also to have forgotten the doctrine which he elsewhere supports, ** that the cost of production determines the price, belbw which com- * modlttes cannot fall for any length of time, because production would'ft^ the&cither suspended or diminished."—Vol. ii. p. 26.

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