Because both public stock and public lands are improper and insufficient as principal funds for defr… — Adam Smith

Because both public stock and public lands are improper and insufficient as principal funds for defraying the necessary expenses of any great and civilized state, those expenses must largely be met by taxes, with the people contributing in proportion to their respective abilities.

By Adam Smith, from La Richesse des nations

Key Arguments

Smith has previously argued that public stock (including treasure, interest‑bearing claims, and paper‑credit schemes) is insecure, perishable, and ill‑suited as a stable, long‑term revenue base for a great state.
In this passage he adds that public lands, as actually managed, are also 'improper and insufficient funds for defraying the necessary expense of any great and civilized state', due both to their under‑productivity and limited scale relative to modern fiscal needs.
From these premises he concludes that 'it remains that this expense must, the greater part of it, be defrayed by taxes of one kind or another', explicitly shifting the focus of public finance from proprietary revenues to taxation.
He closes the sentence (in the next line) by reaffirming his principle that 'the people' must contribute 'in proportion to their respective abilities', tying this transition back to his earlier tax‑equity doctrine from Book V, Chapter I.

Source Quotes

Lands, for the purposes of pleasure and magnificence, parks, gardens, public walks, etc. possessions which are everywhere considered as causes of expense, not as sources of revenue, seem to be the only lands which, in a great and civilized monarchy, ought to belong to the crown. Public stock and public lands, therefore, the two sources of revenue which may peculiarly belong to the sovereign or commonwealth, being both improper and insufficient funds for defraying the necessary expense of any great and civilized state; it remains that this expense must, the greater part of it, be defrayed by taxes of one kind or another; the people contributing

Key Concepts

Public stock and public lands, therefore, the two sources of revenue which may peculiarly belong to the sovereign or commonwealth, being both improper and insufficient funds for defraying the necessary expense of any great and civilized state; it remains that this expense must, the greater part of it, be defrayed by taxes of one kind or another; the people contributing

Context

End of Book V, Chapter II, Part I; Smith sums up his critique of proprietary revenue sources and prepares to turn to the systematic analysis of taxation as the mainstay of public revenue.