Taxes and the Fall of the Roman Empire

Eastern Empire Coins

"In this world nothing can be said to be certain, except death and taxes."

Ben Franklin

Simply it took a horde of locust-like tax collectors to fund the Roman military machine, the massive Imperial bureaucracy and pay for the opulent lifestyle of the Emperor and his large family.

So some "barbarian horde" crosses over the Rhine, the Danube or the deserts of Arabia to set up shop. Sure the Emperor's army is gone, but once the initial looting and raping is over the locals notice that the Emperor's tax collectors are also gone.

Suddenly it looks like there is an upside to no longer being a citizen of Rome.

The Muslim Conquest and Tax Reduction

From: The Grand Strategy of the Byzantine Empire by EDWARD N. LUTTWAK


What the Muslim Arab conquerors themselves humbly saw as a divine victory, Nasr Allah, can be recognized in retrospect as something even better, a political victory over both empires that won not merely vast territories but also the consent of many of their inhabitants.

The impetuous Arab advances could have been nothing more than ephemeral raids, destined to be nullified by nativist resistance, had the invaders not offered two very great and immediate advantages with their arrival.

One was a drastic reduction in taxes that had become ruinously onerous. The other was truly paradoxical: by imposing discriminatory rules on all non-Muslims, the Muslim Arabs ended the arbitrary religious persecutions that had recently oppressed a majority of the inhabitants of Syria and Egypt.

Muslim taxes could be low because the cost of Muslim rule was very low at first. The conquerors had neither a vast imperial overhead of bureaucrats and courtiers in the austerity of Mecca and Medina, nor were they trying to rapidly rebuild wrecked imperial armies as both the Byzantines and Sasanians were doing in those years. The taxes imposed by the Muslim authorities were both harshly discriminatory, because only non-Muslims had to pay most of them, and blessedly lower than the relatively well-documented Byzantine taxes, and known Sasanian taxes.

While nobody has ever been able to prove—as many have tried to prove—that the Roman empire “fell” because of excessive taxation, it was and remained until the mid-seventh century a top-down system, whereby the total amount of imperial expenditure for the coming year was determined first, the revenue needed was then calculated province by province, and that total was in turn allocated within each province among its registered taxpayers, mostly payers of the land tax, according to periodic assessments of the agricultural yield of each tract (jugatio) and the available manpower (capitatio).

Roman tax collector

It was a uniquely sophisticated and very effective system of collection, which was indeed the central advantage of the Roman and Byzantine empire over all other contemporary powers. It did mean, however, that the taxpayer had to pay a precalculated amount regardless of good or bad harvests, droughts or floods, destructive foreign raids, or even outright invasions.

An especially dramatic disaster that attracted much attention might persuade the imperial authorities to reduce the revenue obligation of the affected province, but no allowance could be made for ordinary harvest or market fluctuations, because there was no way of offsetting lost revenues: the concept of the public debt and its sale in the form of interest-bearing bonds had not yet been invented.

The purchase of remunerated government positions, which swapped a single capital payment for a revenue stream, was the functional equivalent of selling bonds to the public, but it could not be widely practiced. Hence current expenditures had to be paid for by current taxes in a strict pay-as-you-go sequence—a tolerable burden in good years but harsh in bad years, and sometimes reason enough to flee homes and lands ahead of the tax collectors.

Fundamentally, Byzantine tax collection was simply too effective. Emperor Anastasios (491–518) had his share of foreign incursions to confront with costly military operations, and four years of more costly full-scale war with ever-aggressive Sasanian Persia from 506, and he also spent vast sums on public works, among other things substantially rebuilding and fortifying the Long Wall and building the fortress city of Dara (near Oèuz, Turkey), “fortifying it with a strong circuit wall and bestowing on it . . . not only churches and other sacred buildings but colonnades, and public baths.”

Anastasios spent much, yet he was able to abolish the collatio lustralis, a top-down capital levy on every form of wealth: buildings, animals, tools, and the slave-value of artisans, merchants, and professionals, excluding teachers but including prostitutes and catamites. It was originally collected every five years (lustrum), which became every four years in the normal way of taxes by the time of Anastasios, but either way it was very hard for artisans and small merchants to come up with the gold payment all at once (in spite of its Greek name chrysargyron, “gold-silver,” only gold was accepted by the tax collectors).

The text known as A Historical Narrative of the Period of Distress Which Occurred in Edessa, Amid and All Mesopotamia, also known as The Chronicle of Joshua the Stylite, describes the ecstatic reaction to the levy’s abolition in the town of Edessa, whose assessment was 140 pounds of gold, 10,080 solidi, evidently a crushing burden:

• "The edict of the emperor Anastasios arrived this year, remitting the gold which tradesmen paid every four years and freeing them from the tax. This edict did not go only to Edessa but to all the cities of the Roman domain . . . and the whole city rejoiced, and they all dressed up in white, from the greatest to the least, and carrying lighted candles and burning censers, to the accompaniment of psalms and hymns, they went out... thanking God and praising the emperor . . . they extended the feast of joy and pleasure for a whole week. . . . All the artisans sat around and had a good time, [bathing and] relaxing in the courtyard of the City church and all the city’s colonnades."

Having both spent much and given up much revenue—but he also increased the efficiency and probity of tax collection—Anastasios left 3,200 centenaria of gold, that is, 320,000 Roman pounds, in the treasury at his death.11 As of this writing, the price of gold is roughly US$903 per ounce or 31.1 grams, so the surplus left by Anastasios came to roughly US$3,039,496,257—not much these days, but gold was much more valuable then, in terms of bread, for example.

At the time of the Arab invasions there was no budget surplus to hoard. Thirty years of war had increased expenditures while greatly re-ducing revenues, leaving the treasury empty or near enough. Hidden reserves—such as ecclesiastical ornaments in gold and silver that could be confiscated in a crisis—were also exhausted. Already in 622 emperor Herakleios “took the candelabra and other vessels of the holy ministry of the Great Church [the Hagia Sophia], which he minted into a great quantity of gold and silver coin.”

The result was that tax revenues had to be collected from Syria and Egypt as soon as they were reconquered after years of Sasanian occupation—and these were lands that had been taxed by the Byzantines, invaded and taxed by the Sasanians, fought over repeatedly and often looted, before being regained to be taxed again. The empire was rebuilding its strength, and its subjects had to raise the necessary gold, or else face expropriation or worse.

It was too much. They welcomed the Muslim Arabs instead, discriminatory poll tax and all.

American Empire VS Roman Empire : monetary history repeats itself

This is a short montage of a one hour and twenty minutes lecture

by Joseph Peden at the The Ludwig von Mises Institute.

Inflation and the Fall of the Roman Empire - full lecture by Professor Joseph Peden

This is the long version. Have it play while you are surfing the net. Tons of info on taxation and the funding of the Roman military machine.

Tax Collectors in 16th Century Russia
One way or another the State will get the money it wants.

Taxation, trade and urbanism in the Byzantine Empire

There was a long tradition of urban life in the Hellenistic and Roman East, but it is clear that during the Byzantine period, the nature of urbanism changed from the city-state model of Classical Antiquity.

One of the problems for East Roman provincial cities in Later Antiquity was that power became centralised around the imperial court and family and therefore it was incredibly important for powerful figures to be close to the power and patronage of the court.

Therefore there developed a clear distinction between the elites of the provinces and the elite around the presence of the emperor.

Because in the early mediaeval period, following the loss of the Levant to the Arabs, there was a decline in the population of the provincial cities, this accelerated the drift of the rich and powerful to the centre. The traditional aristocracy gradually lost power and needed patronage and imperial titles, plus the salaries that came with them, to retain their positions in the ruling elite. The administrative changes of the early emperors, culminating with the reforms of Justinian I, made the shift away from the traditional ruling elite complete and henceforth the elites became more and more dependent on imperial patronage and salaried positions.

This led to Constantinople becoming and even more dominant factor in the life of the empire, increasing in importance and population throughout Late Antiquity and the Early Middle Ages.

However, at no time did any more than around 10% of the total population of the empire live in cities, and some formerly large cities dwindled fairly dramatically in the 7th and 8th centuries, with them becoming basically walled enclosures for a group of villages, with a central administrative district, often clustered around a church or an administrative building. These were known as kastra, and these kastrons were to become a permanent feature of urban locations from the 8th century onwards.

From the end of the 9th century onwards we see a revival of urbanism in the empire, with rebuilding and even new foundations in previously non-urban settings.

As I mentioned before, the cities had separate localised elites that were linked to the elites of the capital, but with their own networks, often based around the governors, tax officials and bishops. They were not as independent as cities in the West, but the empire was a far more regulated and closely administered political entity than any western nation during the mediaeval period.

It was really only after 1261, under the Palaiologoi that you see cities with truly independent and separate status to Constantinople; Trebozond, Mistra, Adrianople etc, but many of these were not directly under imperial rule anyway by that time.

“The question of the continuity of civic institutions and the nature of the polis in the late antique and early Byzantine world have become a vexed question, for a variety of reasons. Students of this subject continue to contend with scholars of earlier periods who adhere to a much-outdated vision of late antiquity as a decadent decline into impoverished fragmentation. The cities of late-antique Greece displayed a marked degree of continuity. Scenarios of barbarian destruction, civic decay, and manorialization simply do not fit. In fact, the city as an institution appears to have prospered in Greece during this period. It was not until the end of the 6th century (and maybe not even then) that the dissolution of the city became a problem in Greece. If the early sixth century Syndekmos of Hierokles is taken at face value, late-antique Greece was highly urbanized and contained approximately eighty cities. This extreme prosperity is born out by recent archaeological surveys in the Aegean. For late-antique Greece, a paradigm of prosperity and transformation is more accurate and useful than a paradigm of decline and fall.”

Richard M. Rothaus, Corinth: The First City of Greece. Brill, 2000. ISBN 9004109226

The Walls of Byzantine Thessaloniki
Around 10% of the total population of the empire live in cities, and some formerly large cities dwindled fairly dramatically in the 7th and 8th centuries, with them becoming basically walled enclosures for a group of villages, with a central administrative district, often clustered around a church or an administrative building. 

That is an interesting summary of urban life in the East in Late Antiquity, and one that needs to be seen in contrast to the position in Italy.

Now, a brief overview of taxation in the Byzantine empire.

Regardless of the relative decline or regrowth of urban life in the empire, the main generator of wealth was agriculture.

At least 80% of all tax revenues were raised from taxation of the village units or coloni who represented the agricultural base of the empire.

The village was the demographic unit of taxation, which were broadly speaking land taxes, towns and cities were not treated any different, they were assessed for taxation on the same basis. Indeed most cities and towns were also involved in agricultural production to some degree, with a proportion of urban populations cultivating land either inside the urban boundaries or outside but close to the cities and towns.

The other main source of tax revenue was the hearth tax, basically a poll tax and there were various other taxes, such as inheritance taxes and taxes in trade and what we might call customs duties.

Tax collection was incredibly efficient and imperial tax collectors were able to generate huge amounts of money for the imperial treasuries. Agricultural land was assessed on the basis of productivity, and there were different rates of taxation for higher and lower producing areas.

Obviously, things were not static, the imperial bureaucracy was remarkably resilient and flexible and over the centuries there were different ways that taxes were assessed and collected.

With the administrative changes to the structure of the empire, with the creation of the thematic system, we see a devolution of some power and of tax collection to the theme governors.

Gold solidus of Romanos I with his eldest son, Christopher Lekapenos. 
Romanos I Lekapenos, was an Armenian who became a Byzantine
naval commander and reigned as Byzantine Emperor from 920 until
his deposition on December 16, 944.

However, it was not really until the 11th century that we see a change in the provincial balance of power and a growth and expansion of large provincial landowning families. Under the Macedonian dynasty, land grants were made increasingly, under the pronoia system, whereby, instead of paying salaries to high-ranking aristocrats and officials, the right to tax farm was granted.

The pronoia system was expanded in the 12th century by the Komnenoi and following the period of the Latin Empire, the pronoia grants became increasingly hereditary.

Land grants were also made to the Church and from the 12th century onwards there was a transfer of land from the emperor to the great families and the Church. This led to a reduction in the amount of money available to the Exchequer and resulted in a debasement of the currency and dramatic price inflation.

Trade in the empire was generally mainly an internal affair, between towns and provinces or inwards to Constantinople. The elites derived their power and income from their estates and from their imperial salaries, they did not engage in trade.

There were some imperial monopolies, silk production, for example, but trade and manufacturing seems to have not generated enough wealth to allow speculative trade ventures outside the empire, even where this was allowed by law.

Trade was heavily regulated and tradespeople, in Constantinople at least, were organised into guilds and the guilds were subject to regulation by the City prefect.

As I said earlier, trade was internal and much trade flowed into the centre.

Clearly in the themes, there was small scale local trade, but because of the extreme (for the mediaeval period) centralisation of the state, it was trade with the centre that mattered most. Trade was taxed at a rate of 10% of the value of transactions.

It was this particularly undeveloped aspect of the Byzantine economy that allowed the Italian city-states to take such a large role in the trading life of the empire.

Exports from the empire were actively discouraged, essential goods being prohibited from being exported and over time, the concessions made to the Genoese, Venetians and others effectively removed the wealth generation from Byzantine hands virtually completely.

Read the full article

Grand Strategy of the Byzantine Empire

Dead?  -  You Must Still Pay Taxes.
"When pestilence swept through the whole known world and notably the Roman Empire, wiping out most of the farming community and of necessity leaving a trail of desolation in its wake, Justinian showed no mercy towards the ruined freeholders. Even then, he did not refrain from demanding the annual tax, not only the amount at which he assessed each individual, but also the amount for which his deceased neighbors were liable."
Procopius
Secret History