Thursday, November 10, 2005

Maxims not Canons

O. P. Srivastava in the Economic Times, India (part of India Times), 9 November, writes an article: “Junk the loose canons of taxation”.

Fair enough, a point of view upon which we could possible agree if we read what he proposed in them should be ‘junked’. However he writes at the head of the article:

“Adam Smith, author of economic science had formulated an important set of principles, which he called “canons of taxation”. They were the canons of equality, certainty, convenience and economy. He was basically concerned with the ways in which an economy could increase its productive capacity and thereby receive a higher rate of economic growth.”

It is a common error (originating not where I know of) in respect of what Adam Smith wrote, to refer to his “canons of taxation”. He did not use such a word. He reported them as “maxims” not canons.

Nor did he formulate the maxims himself. He was quite specific on this point. Smith wrote in reference to the maxims he had summarised: the “foregoing maxims have recommended them more of less to the attention of all nations” (“Wealth of Nations”, V.ii.b.7: page 827).

In other words, Smith reported on the generally accepted maxims of taxation; he did not invent them, nor call them canons.


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