Pramāṇa · Search · About · API

Hindu Polity: A Constitutional History of India in Hindu Times c46: Chapter XXXIII: Taxation

Hindu Polity: A Constitutional History of India in Hindu Times c46

Language
English

Chapter XXXIII: Taxation

c46.2

§ 334. The Hindu theory of taxation is of immense importance from the constitutional point of view. Taxes had been fixed by Law and the scales had been embodied in the Sacred Common Law. The consequence was that whatever the form of government, the matter of taxation was not an object of the ruler's caprice. No friction could therefore legally arise between the Crown and the People on the question of taxation. The main source of friction and of oppression was thus guarded against.

c46.3

That the constitutional law of taxation was a living law regulating life, is borne out by pieces of historical evidence. For instance, in the inscription of Queen Balaśrī of the Sātavāhana family, it is proclaimed that *her son levied taxes in accordance with the sacred law*. Other inscriptions point to the same conclusion.¹ Literature has some curious instances proving the inviolability of the taxes fixed by the law. Chandragupta the Great had to raise money, presumably for his intended war with Seleukos. He and his great Chancellor Kauṭilya were at their wit's end to collect a sufficient amount of money; the legal taxes were not productive enough for the purpose. They had to, as is evident from the Artha-Śāstra, take recourse to odd methods, which demonstrate the majesty of the law on the one hand and the inconvenience of a rigid legal revenue on the other. Chandragupta asked his people to give him money as a 'token of affection' (*Praṇaya*). He also raised money from temples.¹ Patañjali writing under the reign of Pushymitra while commenting on Pāṇini, V. 3. 99., humorously remarked that the Mauryas who wanted gold raised it by instituting images of gods for worship.² In the Jaina tradition, Chāṇakya is alleged to have issued eight hundred million debased silver coins called *kārshāpaṇas* to fill the treasury. All these facts indicate a very great urgency, and at the same time a scrupulous respect for the letter of the law.

c46.4

¹ Archaeological Survey Report of Western India, Vol. IV, p. 108; *Ep. Ind.*, Vol. VIII, p. 60, धर्मोपर्जितकर विनियोग करस—l. 6; p 44, line 14. Cf. also "That avaricious king, who foolishly oppresses his subjects by levying taxes not sanctioned by the Śāstras, is said to wrong his own self."—*Mahā-Bhārata, Śānti*, LXXI, 15.

c46.5

¹ *Arthasāstra*, pp. 241-2.

c46.6

² Jayaswal, *IA.*, 1918, p. 51.

c46.7

§ 335. The revenue raised by taxes was under the control of the Council of Ministers who were also vested with the power of collecting the revenue. As early as the fourth century B. C., as we find from Megasthenes (§ 316), the department of the Exchequer was under the Ministry, whose history does not begin there but goes back to the Vedic Ratnins and the Ratnin Treasurer. The evidence of Bhāradvāja (§ 317) is also decisive and goes back beyond the fourth century B.C. The Ministry collected revenue and disbursed expenditure according to him.

c46.8

§ 336. Apart from the question of amount and collection of taxes, the taxes themselves were regarded in Hindu politics as wages of the king for the service of administration:

c46.9

बलिषष्ठं च शुल्कं च दण्डेनाथापराधिनाम् ।
शास्त्रानीतेन लिप्सेथा वेतनेन धनागमम् ।

c46.10

"The one-sixth *Bali* tax, import and export duties, fines and forfeitures collected from offenders—gathered in accordance with the Sāstras (law and constitution), as your wages (vetanena), shall constitute your revenue."³

c46.11

³ *MBh.*, Sānti P., LXXI, 10.

c46.12

Nārada also ordains:

c46.13

"Both the customary receipts of a king and what is called the sixth of the produce of the soil, form the royal revenue, the reward for the protection of his subjects".⁴

c46.14

⁴ *Nārada*, XVIII. 48 (Jolly).

c46.15

The theory is as ancient as the Artha-Śāstra of Kauṭilya (300 B.C.), or we should say, it is anterior to 300 B.C. for it is quoted in the Artha-Śāstra. The taxes were regarded as the wages of the king, the wages which were fixed according to the theory mentioned above (§ 267) by the original contract between the first King and the People. The broker to that contract, according to the theory, was the Creator himself. It was He who recommended Manu to the People for election.

c46.16

§ 337. The wage-theory was further developed by political scientists and turned into what we may call a divine theory of taxation. I cannot do better than quote that theory in the language of the scientist himself:

c46.17

स्वभागभृत्या दास्यत्वे प्रजानां च नृपः कृतः ।
ब्रह्मणा स्वामिरूपस्तु पालनार्थे हि सर्वदा ॥

c46.18

"God has made the king, though master in "form, the servant of the People, getting his "wages (sustenance) in taxes for the purpose of "continuous protection and growth."¹

c46.19

¹ Śukranītisāra, I. 188.

c46.20

In other words, the Master-Servant of the People has his wage or maintenance fixed by divine authority: he was not to take more, for he was not entitled to more. The Subject, really the Master, was bound to "protect" the king, as promised by the priest on his behalf at the coronation (§ 224) by giving him his lawful maintenance, his share (*Svabhāga*).

c46.21

Here we have the arguments (§ 244) of the Mānava-dharma-Śāstra turned to yield a divine origin of king's servitude. Diamond cuts diamond. In the land of Uśanas and Bhāradvāja, a theory ascribing divine personality to kingship—a potential licence for autocracy—could never be tolerated. It was opposed to the trend of past history. Hence to cut 'Manu' the teacher of men, the Hindu sought out 'Śukra' the Teacher of Gods.

c46.22

§ 338. The theory that the taxes were wages for protection was so ingrained in the constitution that even partial failure of protection was deemed to entitle the subject to claim refund of wages in proportion to the loss. And those claims, as we have seen, had to be allowed either in the shape of concessions or actual payment (§ 281). The subject thought that the servant-king was not fulfilling his obligation. He thought that the compact was not fully kept and he threatened, as the *Artha-Śāstra* says (XIII. 1, p. 394), to migrate to the enemy country. In other words, the subject threatened to transfer allegiance. The Mahā-Bhārata says the same thing when it sanctions the a b a n d o n - m e n t o f t h a t k i n g w h o f a i l s t o p r o t e c t.¹ He is like a ship which leaks, that is, dangerous to remain with; and he is like the barber who wishes to go to the forest, evidently to become an ascetic. The barber has left his clientele and master, and broken his contract of service. He is fit to be given up and another barber is to be appointed to the household. Similarly the king who failed in his duty was worthless, fit to be given up. The relation between the king and the subject is proved to have ended by the very fact of the former's incapacity. The tie of allegiance is deemed dissolved the moment the king failed to fulfil his duty of protection, and the subject was free to employ

c46.23

¹ > राजानं प्रथमं विन्देत् ततो भार्याँ ततो धनम् । ३१

c46.24

\* \* \* \*
प्राचेतसेन मनुना श्लोकौ चेमावुदाहृतौ ।
राजधर्मेषु राजेन्द्र ताविहैकमनाः शृणु ॥ ४३
षडेतान् पुरुषो जह्याद्भिन्नां नावमिवार्णवे ।
अप्रवक्तारमाचार्य्यमनधीयानमृत्विजम् ॥ ४४
अरक्षितारं राजानं भार्याँ चाप्रियवादिनीम् ।
ग्रामकामं च गोपालं वनकामं च नापितम् ॥ ४५

c46.25

XII, 57 (=56 Kumbhakonam). The Manu cited here is the author of a work on politics called evidently *Rājadharma*. The work which was probably of a school is quoted by Kautilya as 'the Mānavas'.

c46.26

another servant-master instead. This was a natural corollary to the theory of taxation and the king's legal position.

c46.27

§ 339. The canons of taxation settled by constitutional writers agree with the *telos* for which Hindu state was created, namely, 'for prosperity, land-culture, wealth and well-being' (§ 227).

c46.28

The main-stay of revenue was the king's fixed bhāga or the 'share' of produce of agriculture. His 'share' in merchandise sold in the market was 'one-tenth' or so according to circumstances¹. There were however some other sources of revenue which are at present called excise and customs (*śulka*). In the regulation of these the king had a somewhat free hand. The later law-books attempted even to regulate these by fixed laws. Yet they could not exhaust the list and a greedy or needy sovereign could find some loop-hole. The Nandas are accused to have taxed hides or furs. Evidently these articles had not been taxed before. There was a vast trade in skins or furs between the Magadha Empire and the Himalayan countries as the Artha-Sāstra proves.² These imports when taxed by the predecessors of Chandragupta gave rise to accusations of greed. Evidently it was with reference to such occasions and opportunities and the realization of the *bhāga* in general that canons of taxaion were evolved and settled.

c46.29

¹ Cf. Manu, VII. 130-132; Gautama, X. 24-27; Vasishtha, XIX 26-27; Āpastamba, II 10, 26, 9; Vishṇu, III. 22-25; Baudhāyana, I. 10. 18. 1.

c46.30

² XI. 2.

c46.31

The general principles of Hindu taxation are:

c46.32

(1) In taxation the king 'should not by greediness destroy his own foundations as well as those of others.'³

c46.33

³ Mahā-Bhārata, XII. 87. 18:

c46.34

(2) Subjects may be taxed in a way that they may remain strong to bear future burdens and, if necessary, heavier ones. "If the calf is permitted to suck it grows strong, O Bhārata, and can bear (heavy weight) and pain." The king should milch taxes

c46.35

नोच्छिन्द्यादात्मनो मूलं परेषां चापि तृष्णया ।

c46.36

keeping the above principle in view. Over-milching is to weaken the calf and consequently harms the milcher himself.¹

c46.37

¹ *Ibid.*, 87. 20-21 :

c46.38

(3) It is not the heavily-taxed realm which executes great deeds but the moderately taxed one whose ruler not sacrificing the power of defence, manages administration economically.² The subjects oppose that king who is extravagant in administration (‘*eating* too much’).³

c46.39

² *Ibid.*, 41. 22 :

c46.40

³ *Ibid.*, 87. 19:

c46.41

(4) The great principle emphasised is that taxation should be such that it may not be felt by the subject. The ruler should act like a bee which collects honey without causing pain to the plant.⁴

c46.42

⁴ *MBh*, XII c. 88. 4:

c46.43

(5) In raising taxes higher it should be done ‘little by little when the realm’s prosperity is increasing’. The process must be mild so that the realm might not turn restive.⁵

c46.44

⁵ *Ibid.*, C. 88. 7-8 :

c46.45

*On collection of taxes:*

c46.46

(6) Taxes should be levied “in proper place”, in

c46.47

वत्सोपम्येन दोग्धव्यं राष्ट्रमक्षीयाहुहिना ।
भृतो वत्सो जातबलः पीडां सहति भारत ॥
न कर्म कुरुते वत्सो भृशं दुग्धो युधिष्ठिर ।
राष्ट्रमत्यातितुग्धं हि न कर्म कुरुते महत् ॥

c46.48

यो राष्ट्रमनुगृह्णाति परिरक्षन् स्वयं नृपः ।
संजातानुपजीव्यस्त लभते सुमहत्फलम् ॥

c46.49

प्रद्विषन्ति परिख्यातं राजानमतिखादिनम् ।

c46.50

"Eating" (*khad*) is a technical term for taxation even in the Brāhmaṇa period.

c46.51

मधुपोथं दुहेद्राष्ट्रं भ्रमरा इव पादपम् ।

c46.52

कालेनार्थं देवेन वर्धमानं प्रदापयेत् ।
ततो भूयस्ततो भूयः क्रमवृद्धिं समाचरेत् ॥
दमयन्निव दम्यानि भयद्वारकं विवर्धयेत् ।
मृदूपूर्वं प्रयत्ने न पाशामनवचारयेत् ॥

c46.53

proper time" and "in proper form"¹ They should never be realised by a painful mode—"milch the cow but do not bore the udders."²

c46.54

¹ *Ibid.*, C. 38. 12.,

c46.55

² C. 88 4:

c46.56

*On taxing industries:*

c46.57

(7) 'Taxes should not be levied without determining the outturn and the amount of labour necessary for its production'³ It has to be borne in mind that without proper incentive no body would engage in industry⁴. 'What profit (result of production) would keep the producer to the production and produce benefit to the king as well' should be the ruling consideration in deciding upon the amount of taxes to be levied on industries.⁵

c46.58

³ *Ibid.*, C. 87. 16; M. N. Dutt's translation,

c46.59

⁴ *Ibid.*: फलं कर्म च निर्हेतु न कश्चित्प्रवर्तते ॥

c46.60

⁵ Manu, VII. 129:

c46.61

(8) In productions of art—materials used, cost incurred, maintenance of the artist required for producing the article, and the condition of the artist have to be taken into account.⁶

c46.62

⁶ *M Bh.* XII. 37: *Ibid.*, 14.

c46.63

न चास्थाने न चाकाले करांस्तेभ्यो निपातयेत् ।
सान्त्वपूर्वं प्रदानेन यथाकालं यथाविधि ॥

c46.64

वत्सापेक्षी दुहेच्चैवं स्तनांश्च न विमुहयेत् ॥

c46.65

फलं कर्म च संप्रेक्ष्य ततः सर्वं प्रकल्पयेत् ।

c46.66

यथा फलेन युज्येत राजा कर्त्ता च कर्मणाम् ।
तथा वेक्ष्य नृपो राष्ट्रे कल्पयेत् सततं करान् ॥
यथा राजा च कर्त्ता च स्यातां कर्मणि भागिनौ ।
संवेक्ष्य तु तथा राज्ञा प्रणेयाः सततं कराः ॥

c46.67

उत्पत्तिं दानवृत्तिं च शिल्पं संप्रेक्ष्य चासकृत् ।
शिल्पं प्रति करानेवं शिल्पिनः प्रति कारयेत् ॥

c46.68

*In taxing imports*:
(9) 'Sale (price realised), purchase (capital employed), distance travelled, cost of importing, and the total cost, also the risks incurred by the merchant should be fully considered'¹
(10) "Imports harmful to the state" and "luxuries" ("fruitless") are be discouraged by taxation.²
(11) Beneficial imports should be made free of import duties³
(12) Those articles which are rare in the country, and those which would be seed for future production should be allowed in, free.⁴
(13) Certain commodities should not be exported, while their imports are to be encouraged by not being taxed at all. They were, for instance: (*a*) weapons and armours, (*b*) metals, (*c*) military vehicles, (*d*) rare things, (*e*) grains, and (*f*) cattle.⁵
(14) *Principle of excise or countervailing duty was resorted to in certain cases.* Foreign favourites and private manufactures in wines and liquors were taxed on the principle of 'compensation' with reference to the state manufactures.¹

c46.69

¹ *Ibid.*, 12=Manu, VII, 127: विक्रयं क्रयमध्वानं भक्तं च सपरिव्ययम्। योगक्षेमं च संपेक्ष्य वणिकां कारयेत् कराम्॥

c46.70

² *Artha-Śāstra*, II, 21; (p. 112). राष्ट्र पीडाकरं भाण्डमुच्छिन्द्यादफलं च यत्। महोपकारमुच्छुल्कं कुर्य्याद्वीजं तु दुर्लभम्॥

c46.71

³ & [^4] *Ibid.*

c46.72

⁵ शस्त्र-वर्म-कवच-लोह-रथ-रत्न धान्य-पशूनामन्धतममनिर्यात्यम् etc., Artha-Śāstra, II; 21; 39 (p. 111)

c46.73

¹ *Ibid.*, II, 25; (p. 121).

c46.74

Economic considerations are everywhere prominent. Productive power is not to be hampered; profit and not capital is to be taxed; articles which lead to new industries are to be encouraged; exports which cause "artificial" prosperity by driving up prices are to be discouraged; no special protection is granted to ordinary industries; taxes should be gradual, and with reference to capacity, and not in an obnoxious form.

c46.75

अरराजपण्याः पञ्चकं शतं शुल्कं दद्युः। सुरकामेदकारिष्ट-मधुफलाम्लासवाच्चूनां च।
पञ्चकं निष्क्रयं व्याजीं ज्ञात्वा मानहिरण्‍ययोः।
तया वैधरणं कुर्यादुचितं चानुवर्तयेत् ॥

Linked texts (15)