One of the best accounts of how taxation works in a non-money economy is in a description of taxes in the Indian Empire given in a remarkable book on Trade and Market in the Early empires, masterminded by Karl Polanyi. Here Walter Neale, an economic historian who specialised in Indian history describes the problems faced by British administrators trying to lay down a fair taxation system in a society which works in an entirely different way: the Indian society, with its caste system, is in many ways the epitome of a pre-market economy. . Here an administrator tries to describe a system which he did not understand but which nevertheless he made great efforts to understand and describe. This account is taken from Trade and Markets in the Early Empires, pages 224-5.
In eighteenth century Oudh we find a society in which the cultivators are independent of each other, but connected through heads, and the villages also independent among themselves, but in allegiance to a common Raja; the basis of the whole society being the grain heap, in which each constituent rank had its definite interest. The village did not hold its lands in common but it did have common officials and servants: watchman, headman, clerk, blacksmith, carpenter, herdsman, washerman, barber, priest, and potter. These officials and servants received their remuneration in a share of cultivators’ grain heaps.
Production of food, the main material item in Indian life, was business of the joint agricultural family. The officials and servants to their jobs, doing the appropriate work as and where it was needed. Throughout the year there was no exchange or payment for services rendered. The herdsman watched the cows and the blacksmith made the implements and repaired any ploughs that broke. Each activity carried on according to the custom and tradition of the village within the joint family according to its traditions, station in life, and the judgment of its head.
At harvest time the means of subsistence for the rest of the year were distributed. The system of allotting shares in the gross produce of the village was highly complex, yet it did not require any previous knowledge of total gross produce to be divided among the members the community. While the exact arrangements in the division distribution of the produce varied from place to place, we may take a typical example the system recorded by W. C. Bennett.
Distribution in Gonda took place in three stages: From the standing crop; from the undivided grain heap of each cultivator; and from the heaps after the cultivator had contributed to the Raja’s heap.
From the standing crop of each cultivator the watchman, the blacksmith, the carpenter, the herdsman, the priest, and often the cultivator himself cut a twentieth of a bigha. Next, the crop was harvested and was threshed by the whole community, the grain from the fields of each cultivator being heaped in a separate pile on the community threshing floor. The “slave ploughman” took a share varying from a fifth to a seventh of the heap of the cultivating family to which he was attached. To this share he added a panseri. From each pile each person who had cut or threshed the crop (and this meant everyone) took a sixteenth of the rice and the “fattest sheaf in thirty” of the other crops. Then the carpenter, blacksmith, barber, washerman, and watchman each took twelve panseris of threshed grain from each cultivator for each four bullock plough he owned, and six panseris for each two bullock plough. When these shares had been passed out, the grain heaps were divided in half, the cultivator retaining one half and the other going to the Raja, subject however to further distributions. One sir in every maund of the Raja’s heap was returned to the cultivator, another sir was given to the scribe, a “double handful” to the priest, and a tenth of the remainder was given to the village headman. From the cultivator’s remaining heap the blacksmith and carpenter each received three more panseris, the herdsman one more, and a sir or two went to the scribe.
The matter is certainly intricate.