The Greeks had two ways of taxing their people. One was liturgy, where wealthy citizens unselfishly gave more to the government than they were made to. The other taxation method was named “tax-farming,” which had a long and colorful history. Tax farmers were private citizens who bid at public auctions for the right to collect a specific tax, for example, a harbor tax, an inn tax, or a sales tax. With precise records from prior years, and excluding any misfortune, the amount of tax gain expected could be accurately calculated. The business was risky, but seems to have been profitable. In the city-states, tax farming was a better method to government taxation. The private contractor did a better and more economical job of collecting taxes.
The right to collect taxes is a huge delegation of sovereign power. But considering that taxes were low in Greek city-states, tax farming wasn’t a major enterprise. To the Greeks, it was a simple efficient method of collecting taxes in a nation in which tax evasion was not worth the effort. The most serious abuse of the system came from the tax farmers.
The modest system of tax farming, originally set up by the city-states, was completely different from the system of the later Greeks in the 3rd to first century B.C. We see accounts of how the world suffered under the terrible oppression of the tax farmers. And this was before the Romans were around! The Greek democrats who instituted tax farming would have been astounded to see that in a few hundred years their simple private collection method had evolved into a monstrosity of oppression. They would have been even more astounded, perhaps, to find out that tax farming flourished in Western civilization, in many bizarre methods, for 2,500 years, finally going out of style in the early 1900’s. Go here if you want help with modern-day Tax Preparation, bookkeeping, and payroll in Cary NC
Greeks were giants in the ancient world and had an interesting take on taxes and government. The Greeks said that the liberty and freedom of a society was best measured by its tax system. We, 2,500 years later, are less profound in our analysis of taxation. We seem to accept any tax adopted by our legislators. We let class politics form tax laws. And we let legislators tax just about anything they please in any way they want. If you’re feeling the pressure with today’s taxes, call a Raleigh NC Accountant for all your tax-related needs!
Overall, the bright spot in the Greek history was in their administration of taxes. Tax revenue was evaluated and administered by the taxpayers themselves, without the intervention of a massive government bureaucracy. Even more important was the response of the rich to the needs of the community. They shared their wealth with the community and did not hesitate to see that the city and its people benefited from the bounties bestowed on them.
The Greek view was simple – taxes are tyrannical, and hence illegal, if they are demanded by arrogance and compulsion. They are justifiable when based on reasonableness and loving care. We have retreated a great distance from those lofty ideas.
Keep an eye out for W. Marc Gilfillan’s next chapter in his History of Taxes series: Taxes and the Greeks.