278 ECONOMIC PRINCIPLES

It is to be noted that the above outline discussion deals
with the proper measure, or test, of just distribution of tax
burdens as a whole, not with the lines along which specific
taxes should be designed. The most satisfactory conception,
though one not easy to reduce to practical application, is
that the marginal cost, to the tax-payer, of the government
services for which taxation pays, should correspond with the
marginal utility to him of government services. The
compulsory nature of tax payments would, in that case, be
matter of form rather than an element modifying the
relation of cost to value. Now the marginal utility of his
disposable resources, say of money for convenience, to any
citizen tends to be the same for all lines of expenditure, for
otherwise advantage would be realised by the transference
of some part of the outlay from one line to another. The
reduction of income freely disposable must raise the marginal
utility of that which is left. If the changes of marginal
utility, for different grades of magnitude of income, due to
the devotion of a part of income to the payment of taxes,
are such as to raise the marginal utility in greater proportion
in some cases than in others, the desired equality of sacrifice
is not secured. In view of the fact that, of large incomes, a
larger part is commonly devoted to non-necessary expenditure
 than is the case with small incomes, it is probable that
the rise of marginal utility proceeds at a slower rate, for
equal percentages of reduction of income, in the former than
in the latter class of incomes. If this be so, it will be a
ground for a larger percentage levy on large than on small
incomes. The degree of the increase in percentage, however,
will not be proportional to the magnitude of the total
income, and may be very much less than proportional to it.
If taxation were so distributed as to leave unchanged the
proportions of the marginal utility of money to the recipients
of incomes of different magnitudes, the tax system might be
said to involve no redistribution of property as an incident
to the raising of the revenue needed to cover government
outlay. It would, however, have the result of dictating the
kind of satisfactions available to each as the equivalent of the
tax payments, and this consideration may serve to indicate an