Public Revenue Without Taxation

Summary

Public Revenue Without Taxation is a book by Ronald Burgess, published by Shepheard-Walwyn (Publishers) Ltd, London, in 1993. Burgess acknowledges indebtedness to the late Colin Clark, Director of the Agricultural Economics Research Institute at the University of Oxford, and the Economic Study Association. The book is typeset by Alacrity Phototypesetters and printed by BPCC Wheatons Ltd, Exeter.

Burgess's thesis is that "taxation is a primal cause of both inflation and unemployment" and that governments persist in raising revenue through taxation only because of "ignorance of any acceptable alternative method of raising sufficient public revenue" (Burgess 1993, p. 1). The book argues that land rent — the value arising from the nature of a trading economy itself — provides a "natural source of government revenue" that does not offend against the principle of private property, unlike taxation. Burgess traces this insight from the Physiocrats through Adam Smith, Alfred Marshall, and Henry George, arguing that modern economics has failed by ignoring the possibility of a non-tax source of public revenue (Burgess 1993, Ch. 1, pp. 1–6).

The book is organized into sections on: The Failure of Economics, The General Theory of Employment, Tax Analysis (tax and unemployment, tax and inflation), The Physiocratic Tradition, Neo-Classical Arguments, Public Revenue, and Towards Reform.

Core Findings

The Failure of Orthodox Economics (Ch. 1, pp. 1–6)

Burgess argues that both demand-side (Keynesian) and supply-side (monetarist/Chicago) schools of economic thought have failed, offering only a trade-off between inflation and unemployment. The demand-side school concentrates on aggregate demand and pursues full employment through high public spending, leading to inflation. The supply-side school pursues inflation eradication through money supply control and public sector reduction, leading to unemployment. Burgess quotes Lord Keynes's 1946 toast that economists are "the trustees, not of civilisation but of the possibility of civilisation," arguing economists have failed this trust (Burgess 1993, Ch. 1, pp. 1–4).

Colin Clark's 25% Limit (Ch. 1, p. 2)

Burgess cites Colin Clark's finding, first argued in The Economic Journal of December 1945, that inflation becomes inevitable when total government tax revenue plus ing exceeds 25% of net national product at market prices. Keynes agreed with Clark, and subsequent experience in most countries appears to support this view. Burgess notes that demand-side full-employment budgets result in this limit being "substantially exceeded" (Burgess 1993, Ch. 1, p. 2).

The Supply-Side Failure (Ch. 1, pp. 3–4)

Burgess argues that supply-side policies have been ineffective in reducing either public spending or the tax take. In the United Kingdom, supply-side policies were presumed to have been implemented from 1979; in that year tax revenue appropriated 38.6% of net national product. A decade later, tax revenue was appropriating about 40% — i.e., it had increased despite supply-side rhetoric (Burgess 1993, Ch. 1, p. 4). Burgess cites Lord Stockton's critique of Thatcher's privatization as "selling off the family silver" (Burgess 1993, Ch. 1, p. 3).

Taxation as Violation of Private Property (Ch. 1, pp. 4–6)

Burgess argues that taxation flouts the principle of private property. He cites Adam Smith's Wealth of Nations (Bk. V, Ch. II), where Smith laid down the "Canons of Taxation" but also accepted that in the absence of a fund "peculiarly belonging to the public authority," necessary government expenses must be defrayed "from the revenue of the people." Burgess argues that economists have followed only Smith's first lead (how to tax efficiently) and ignored his second (investigating a source of revenue peculiarly public). He cites Alfred Marshall's distinction between the public and private value of freeholds as following Smith's second lead (Burgess 1993, Ch. 1, pp. 5–6).

The Physiocratic and Georgist Tradition (Ch. 4)

Burgess traces the intellectual lineage of non-tax public revenue from the Physiocrats (who first identified land rent as the natural source of public revenue), through Adam Smith, Alfred Marshall, and Henry George. He cites George's Progress and Poverty as the key development of this tradition, arguing that George and his followers continued the investigation that orthodox economics abandoned (Burgess 1993, Ch. 1, p. 6, note citing George).

The Primary Division: Land vs. Capital (Ch. 2, pp. 8–9)

Burgess restates the classical distinction between land (non-human factors in their natural state, unmodified by labor) and capital (non-human factors modified by labor). He argues that this distinction is essential for understanding how a trading economy generates a natural fund of public revenue — the rent of land — that belongs to the community rather than to any individual (Burgess 1993, Ch. 2, pp. 8–9). He applies Ricardo's theory of rent to both non-trading and trading economies, arguing that in a trading economy, land rent takes on a distinctive public character (Burgess 1993, Ch. 2, p. 9).

Policy Recommendations

1. Abolish all taxation and replace it with the collection of land rent as the sole source of public revenue (Ch. 7–8)
2. Introduce reform "with a minimum of disruption, so that politicians, with an eye to the next election, may reap some results within the life of a parliament" (dust jacket)
3. Recognize that the rent of land is "natural in the sense of arising from the nature of a trading economy" and is not a tax but a collection of value that already belongs to the public

Nuances and Limits

• The book's argument that taxation is a "primal cause" of both inflation and unemployment is a strong claim (B-claim) that most mainstream economists would dispute; the consensus view is that inflation has multiple causes (monetary, fiscal, supply-shock).
• Colin Clark's 25% limit is cited as empirical support, but the threshold has been exceeded by many developed economies without the predicted inflationary consequences in recent decades, suggesting the relationship is more complex than Clark proposed.
• The book does not provide detailed empirical estimates of how much revenue land rent collection could generate, nor does it address the administrative challenges of land valuation at scale.
• The argument is primarily theoretical and draws on classical economics; it does not engage deeply with modern public finance literature.
• The book was published in 1993 and reflects the policy debates of the Thatcher/Major era; subsequent developments in monetary policy (independent central banks, inflation targeting) are not addressed.

Key Quotes

"Taxation is a primal cause of both inflation and unemployment. Regardless of this, the freely elected governments of contemporary trading economies — with the acquiescence of their electorates — persist in raising the major part, if not all, of their revenues by means of taxation. The immediate cause of such action by governments, and for the acquiescence of their electorates, is ignorance of any acceptable alternative method of raising sufficient public revenue." — Burgess, opening statement, p. 1

"What governments need to know from economics is a source of public revenue that arises from the very nature of a trading economy and does not offend against the principle of private property. This public revenue must be sufficient to cover necessary public expenses after the abolition of all taxation." — Burgess, Ch. 1, p. 6

"The laws of property have never yet conformed to the principles on which the justification of private property rests. The essential element of these principles consists in the recognition, in each person, of a right to the exclusive disposal of what he or she may have produced by their own exertions, or received by gift or fair agreement, without force or fraud, from those who produced it." — Burgess quoting J.S. Mill, Ch. 2, p. 12

"By whatever names taxes are called, or by whatever methods governments may use to raise tax revenue, taxation is in effect an arbitrary levy imposed by force or the threat of force upon those in receipt of a private income. In their effective incidence all taxes are income taxes. By force of statutory law taxation denies to the individual taxpayer the right to the exclusive disposal of that individual's private income. Thus all taxation flouts the principle of private property." — Burgess, Ch. 2, p. 13

"The Physiocrats rightly emphasised the true source of injustice to be the burden of taxation. General taxation, they argued, was a deviation from the 'natural order' which must result also in a contraction of future output." — Burgess, Ch. 7, p. 75

"For George the remedy was simple and practical: 'abolish all taxation save that upon land values.' Like all great works of political economy it was directed at a public issue of topical importance at the time of writing." — Burgess, Ch. 7, p. 77

"The case argued in this work, the abolition of all taxation and its replacement by the collection of public revenue by government as a public duty, is a prerequisite for solving the major social and economic problems, including inflation and unemployment, that today appear endemic in industrialised trading economies. Only when this fundamental change in public finance is completed will social justice together with a stable general price level and economic prosperity become possible to achieve." — Burgess, Ch. 10, p. 109

Bears On

• Land Value Tax — the book's central proposal is land rent collection as replacement for taxation
• Georgism — the book is in the Georgist intellectual tradition
• Henry George — the book builds on George's Progress and Poverty
• Deadweight Loss — the book's argument about the harmful effects of taxation
• Single Tax — the book advocates a single source of public revenue from land rent

See Also

• Ronald Burgess — author page
• Land Value Tax
• Georgism
• Henry George
• Single Tax
• Deadweight Loss

Sources

1. Ronald Burgess, Public Revenue Without Taxation (London: Shepheard-Walwyn, 1993). — primary source for all claims on this page; verified against primary text 2026-07-07 (Scan Depth: Moderate).
2. Colin Clark, "The Economic Journal," December 1945 — the 25% NNP tax limit argument (B-claim; empirical).
3. Henry George, Progress and Poverty — the Georgist theoretical foundation (A-claim; primary source).
4. Adam Smith, The Wealth of Nations, Bk. V, Ch. II — the Canons of Taxation and the "fund peculiarly belonging to the public authority" (A-claim; primary source).