Indian taxation

much heavier

Sentence continued from page 459.]

Mughal Empire, derived from a much smaller population than that of British India, varied, as we have seen,1 from 42 millions net under Akbar in 1593 to 80 millions under Aurangzeb in 1695. The trustworthiness of these returns has been discussed in a previous chapter; and they must be taken subject to the qualifications therein indicated.

If we examine the items in the Mughal accounts, we under the find the explanation of their enormous totals. The land-tax Mughals, then, as now, formed about one-half of the whole revenue. The net land revenue demand of the Mughal Empire averaged 25 millions sterling from 1593 to 1761; or 32 millions during the last century of that Empire, from 1655 to 1761. The annual net land revenue raised from the much larger area of British India, during the ten years ending 1879, has been 18 than now. millions sterling (gross, 21 millions). But besides the land revenue there were under our predecessors not less than forty imposts of a personal character. These included taxes upon religious assemblies, upon trees, upon marriage, upon the peasant's hearth, and upon his cattle. How severe some of them were, may be judged from the poll - tax. For the purposes of this tax, the non-Muhammadan population was divided into three classes, paying respectively £4, £2, and

Mughal poll-tax.

Summary.

Taxation

I annually to the Exchequer for each adult male. The lowest of these rates, if now levied from each non-Musalman male adult, would alone yield an amount exceeding our whole actual taxation. Yet, under the Mughals, the poll-tax was only one of forty burdens.

We may briefly sum up the results. Under the Mughal Empire, 1593 to 1761, the existing returns of the Imperial demand averaged about 60 millions sterling a year. During the ten years ending 1879, the Imperial taxation of British India, with its far larger population, averaged 35 millions, and for the four years ending 1882-83, 40 millions, without allowing for refunds and drawbacks. Under the Mughal Empire, the land-tax between 1655 and 1761 averaged 32 millions. Under the British Empire, the net land-tax has, during the ten years ending 1879, averaged 18 millions, and 18 millions during the four years ending 1882-83.

Not only is the taxation of British India much less than of Japan. that raised by the Mughal Emperors, but it compares favourably with the taxation of other Asiatic countries in our own days. The only other Empire in Asia which pretends to 1 Ante, chap. xi. p. 299, etc. ; table of Mughal Revenues (1593 to 1761).

ENGLISH AND MUGHAL LAND-TAX.

463

a civilised government is Japan. The author has no special acquaintance with the Japanese revenues; but German statists show that over 11 millions sterling are there raised from a population of 34 million people, or deducting certain items, a taxation of about 6s. a head. In India, where we try to govern on a higher standard of efficiency, the rate of actual gross taxation averaged 3s. 8d. a head for the ten years ending 1879, and 4s. id. per head for the four years ending 1882-83.

Province

the

If, instead of dealing with the Imperial revenues as a whole, Taxation we concentrate our survey on any one Province, we find these of a facts brought out in a still stronger light. To take a single under the instance. After a patient scrutiny of the records, it was found Mughals, that, allowing for the change in the value of money, the ancient revenue of Orissa represented eight times the quantity of the staple food which our own revenue now represents.1 The native revenue of Orissa supported a magnificent court with a crowded seraglio, swarms of priests, a large army, and a costly public worship. Under our rule, Orissa does little more than defray and under the local cost of protecting person and property, and of its British. irrigation works. In Orissa, the Rájá's share of the crops amounted, with dues, to 60 per cent., and the mildest Native Governments demanded 33 per cent. The Famine Commissioners estimate the land-tax throughout British India 2 at The landfrom 3 per cent. to 7 per cent. of the gross out-turn.' Ample deductions are allowed for the cost of cultivation, the risks of the season, the maintenance of the husbandman and his family. Of the balance, Government nominally takes onethird or a half; but how small a proportion this bears to the crop may be seen from the returns collected by the Famine Commissioners.

tax.

Their figures deal with 176 out of the 199 millions of Rates per people in British India. These 176 millions cultivate 188 acre. millions of acres, grow 331 millions sterling worth of produce, and now pay 18 millions of land revenue. While, therefore, they raise over £1, 15s. worth of produce per acre, they pay to Government under 2s. of land-tax per acre. Instead of thus paying 5 per cent. as they do now, they would under the Mughal rule have been called upon to pay from 33 to 50 per cent. of the crop. The two systems, indeed, proceed

1 The evidence on which these statements are based, was published in Hunter's Orissa, vol. i. pp. 323-329 (Smith, Elder, & Co., 1872).

2 Report of the Indian Famine Commission, part ii. p. 90, as presented to Parliament, 1880.

26

upon entirely different principles. The Native Governments, write the Famine Commissioners, often taxed the land ‘to the extent of taking from the occupier the whole of the surplus after defraying the expenses of cultivation.'1 The British Government objects to thus 'sweeping off the whole margin of profit.' Increase of What becomes of the surplus which our Government declines population. to take? It goes to feed an enormously increased population. The tax-gatherer now leaves so large a margin to the husbandman, that the Province of Bengal, for example, feeds three times as many mouths as it did in 1780, and has a vast surplus of produce, over and above its own wants, for exportation. 'In the majority of Native Governments,' writes the highest living authority on the question, the revenue officer takes all he can get; and would take treble the revenue we should assess, if he were strong enough to exact it. In ill-managed States, the cultivators are relentlessly squeezed: the difference between the native system and ours being, mainly, that the cultivator in a Native State is seldom or never sold up, and that he is usually treated much as a good bullock is treated, i.e. he is left with enough to feed and clothe him and his family, so that they may continue to work.' John Stuart Mill studied the condition of the Indian people more deeply than any other political economist, and he took an indulgent view of native institutions. His verdict upon the Mughal Government is that, 'except during the occasional accident of a humane and vigorous local administrator, the exactions had no practical limit but the inability of the peasant to pay more.'

Taxation in Native States.

Incidence

of taxation

India.

The Famine Commission, after careful inquiries, states that in British throughout British India the landed classes pay revenue at the rate of 5s. 6d. per head, including the land-tax for their farms, or Is. 9d. without it. The trading classes pay 3s. 3d. per head ; the artisans, 25.-equal to four days' wages in the year; and the agricultural labourers, is. 8d. The whole taxation, including the Government rent for the land, averaged, as we have seen, 3s. 8d. per head during the ten years ending 1879. 1 Report of the Indian Famine Commission, part ii. p. 90, as presented to Parliament, 1880.

Report by Mr. (now Sir) Alfred Lyall, C.B., formerly GovernorGeneral's Agent in Kájputána, afterwards Foreign Secretary to the Government of India, now Lieutenant-Governor of the North-Western Provinces and Oudh ; quoted in the Despatch of the Governor-General in Council to the Secretary of State, 8th June 1880. 'Condition of India,' Blue Book, pp. 36, 37.

3 Report of the Famine Commission, part ii. p. 93 (folio, 1880).

INCIDENCE OF TAXATION.

465

But the Famine Commissioners declare that any native of India who does not trade or own land, and who chooses to drink no spirituous liquor, and to use no English cloth or iron, need pay in taxation only about 7d. a year on account of the salt he consumes. On a family of three persons, the charge amounts to Is. 9d., or about four days' wages of a labouring man and his wife.'1

balance

India.

GROSS REVENUES.-But it should always be borne in mind Gross that the actual taxation of the Indian people is one thing, and sheet of the gross revenues of India are another. As explained in a British previous paragraph of this chapter, the revenues include many items not of the nature of taxation. The following table, compiled from the Parliamentary Abstract for 1882-83 (the latest received by the author before sending these sheets to the press), exhibits the gross imperial revenue and expenditure of India for that year, according to the system of accounts adopted at the time. For the reasons already given, it is practically impossible to analyse these gross totals in such a way as to show the actual amount raised by taxation, and the actual amount returned in protection to person and property. The actual taxation has therefore been dealt with in the two separate statements already given. It is equally impossible to compare the gross totals with those for previous years, owing to changes that have been made from time to time in the system of entering the accounts. The only profitable plan is to take some of the items, and explain their real meaning.

of Indian

The list of items shows how large a portion of the gross Analysis revenue is not of the nature of taxation proper. Public works, revenues including railways and irrigation and navigation canals, in 1883. alone yielded in 1882-83 upwards of 12 millions sterling, or over 17 per cent. of the total. Adding the items of postoffice and telegraphs, which also represent payment for work done or services supplied, the proportion would rise to over 19 per cent. Then the sum of 93 millions gross, or nearly 7 millions net, derived from opium, being an additional 13 per cent. of the gross revenue, is not a charge upon the native Not of the taxpayer, but a contribution to the Indian exchequer by the nature of Chinese consumer of the drug. Add to these the tributes from Feudatory States, produce of the forests, etc., and upwards [Sentence continued on page 467.

Report of the Famine Commis ion, part ii. p. 93 (folio, 1880).

VOL. VI.

2 G

taxation.

1,592,183

Civil Furlough and Absentee Allowances,

Working Expenses and Charges against Capital, Interest, etc., on

Reproductive Public Works,

Non-productive Public Works,

Military,

Interest,

17,440,250

4,468,132

Refunds and Drawbacks,

Total Revenue,