ABSTRACT
This chapter discusses the estimation of actual tax yields as proportions of national aggregates. It examines one historical strand in the literature about taxable capacity: the notion that it is connected with justice or fairness in tax assessment. The chapter turns to what seems at first sight to be another theme, and one which has received a lot of attention in recent years, i.e., the notion of reasonableness as judged by the standards of tax-raising in other countries with similar characteristics. It discusses the proposition that taxable capacity relates to an upper limit beyond which tax ratios cannot be raised. The interpretation of taxable capacity as being connected with the amount of tax which could be justly or fairly imposed on an individual is an ancient one among economic theorists. The concept of an upper limit to the tax burden which can be imposed on a country has a long history.
