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>subsequent medieval times relatively light as a percentage of one's wages? You owed the lord a percentage of what you produced as rent. You owed the church a

>subsequent medieval times relatively light as a percentage of one's wages? You owed the lord a percentage of what you produced as rent. You owed the church a tithe. You also potentially owed service to the lord and the church. Taxes were also paid on certain goods purchased. Taxes that in many cases nobles were exempt from. Kings and feudal lords could also enact special taxes to pay for specific projects. If you were a merchant of some kind and you wanted to float your barge down a river, you had to pay nearly every town you passed through. >it's nothing compared to what we experience today in the developed world. Your overall tax burden could still be tremendous even if it's not paid to 1 central taxing authority.

Robotbeat 5y ago
Yeah, and from what I understand, it was a tax on revenue, not profit. If you harvested 10 carrots and had to give 3 or 8 carrots to your horses, you were still tithed 1 carrot.
- xyzzyz 5y ago
  Only the very wealthiest of land-cultivating peasants owned large animals at the time, though (and pretty much never horses). Also, you wouldn’t feed human edible vegetables to animals, that would be very wasteful. More importantly, these income taxes were based on rather small fraction of revenues, since they were only based on agricultural production, and not on household production. Obviously, it was extremely impractical to tax household production, and it still is. Importantly though, back then, typical household consumed much more of its own production as a fraction of all consumption than today, and as a result, less of their real income was taxed. Here is a way to think about it: if you buy a shirt from someone, you might need to pay the sales tax. However, if you make your own shirt, you aren’t going to pay tax on it. Today, you wouldn’t actually do it, because other people can make a shirt with much less effort than you ever could, so it’s still worth it for you to buy someone else’s product and pay the tax, because the productivity gains of trade will more than pay for what government skims from the transaction. However, back before industrial revolution, the differences in productivity weren’t nearly as big, so it didn’t alway make much sense to specialize in everything and trade.
  - Robotbeat 5y ago
    We don’t tax household consumption today, either. If you grow veggies, cook, mend/sew your own clothes, wash your own clothes, change your own oil, mow your own lawn, 3D print your own stuff, or produce your own solar power, you’re not taxed on it (although that doesn’t stop some folk, whether utilities or whatever, from trying to effectively tax you on it). Of course, household production is massively less efficient for many things, although people are forced into becoming DIYers if tax rates are high, prices are artificially high (think rent-seeking behavior by monopolies like utilities), or if money is scarce (ie if there’s a recession/depression). And my point about carrots was deliberately cartoonish. The point is that revenue, not profit, was taxed.
    - archi42 5y ago
      Fun fact: At least in Germany you often end up paying taxes on self-consumed solar. They calculate the tax based on what you would have payed your regular supplier (or 20c/kWh). But otoh you get to declare your "solar plant" a business, with some nice perks: If you buy the solar equipment for net 20k€ you'll pay 19% or 3.8k€ taxes. You get that money back. In addition, the 20k€ are a business expense and reduce your taxable income (there are two modes for this, either 5%/year for 20 years or a huge block [50%?] the first year and some smaller blocks the next two or three years - I believe). So if you pay 30% income tax, you'll save about 6k€. All other expenses related to the solar plant (service, repairs, insurance,...) also count as business expenses, with the same effect. If you're not earning more than 17.5k€/a in addition to your regular income, you can opt to forfeit the whole stuff in favor of the "Kleinunternehmerregelung" (small business provisions), but then you don't get the above business perks. Though after a few years you can change from a full business to a small business, so you'll have to do the math. Sounds complicated? Welcome to Germany! :D (Disclaimer: This might be not 100% accurate, so talk to your tax consultant if you're doing solar in Germany)
      - realityking 5y ago
        AFAIK this is only true if you pass the power you generate back to the grid - which most people did as it used to be heavily subsidized. If you run your solar without powering the grid, you won‘t be taxed on the used power.

Robotbeat 5y ago

Yeah, and from what I understand, it was a tax on revenue, not profit. If you harvested 10 carrots and had to give 3 or 8 carrots to your horses, you were still tithed 1 carrot.

xyzzyz 5y ago
Only the very wealthiest of land-cultivating peasants owned large animals at the time, though (and pretty much never horses). Also, you wouldn’t feed human edible vegetables to animals, that would be very wasteful. More importantly, these income taxes were based on rather small fraction of revenues, since they were only based on agricultural production, and not on household production. Obviously, it was extremely impractical to tax household production, and it still is. Importantly though, back then, typical household consumed much more of its own production as a fraction of all consumption than today, and as a result, less of their real income was taxed. Here is a way to think about it: if you buy a shirt from someone, you might need to pay the sales tax. However, if you make your own shirt, you aren’t going to pay tax on it. Today, you wouldn’t actually do it, because other people can make a shirt with much less effort than you ever could, so it’s still worth it for you to buy someone else’s product and pay the tax, because the productivity gains of trade will more than pay for what government skims from the transaction. However, back before industrial revolution, the differences in productivity weren’t nearly as big, so it didn’t alway make much sense to specialize in everything and trade.
- Robotbeat 5y ago
  We don’t tax household consumption today, either. If you grow veggies, cook, mend/sew your own clothes, wash your own clothes, change your own oil, mow your own lawn, 3D print your own stuff, or produce your own solar power, you’re not taxed on it (although that doesn’t stop some folk, whether utilities or whatever, from trying to effectively tax you on it). Of course, household production is massively less efficient for many things, although people are forced into becoming DIYers if tax rates are high, prices are artificially high (think rent-seeking behavior by monopolies like utilities), or if money is scarce (ie if there’s a recession/depression). And my point about carrots was deliberately cartoonish. The point is that revenue, not profit, was taxed.
  - archi42 5y ago
    Fun fact: At least in Germany you often end up paying taxes on self-consumed solar. They calculate the tax based on what you would have payed your regular supplier (or 20c/kWh). But otoh you get to declare your "solar plant" a business, with some nice perks: If you buy the solar equipment for net 20k€ you'll pay 19% or 3.8k€ taxes. You get that money back. In addition, the 20k€ are a business expense and reduce your taxable income (there are two modes for this, either 5%/year for 20 years or a huge block [50%?] the first year and some smaller blocks the next two or three years - I believe). So if you pay 30% income tax, you'll save about 6k€. All other expenses related to the solar plant (service, repairs, insurance,...) also count as business expenses, with the same effect. If you're not earning more than 17.5k€/a in addition to your regular income, you can opt to forfeit the whole stuff in favor of the "Kleinunternehmerregelung" (small business provisions), but then you don't get the above business perks. Though after a few years you can change from a full business to a small business, so you'll have to do the math. Sounds complicated? Welcome to Germany! :D (Disclaimer: This might be not 100% accurate, so talk to your tax consultant if you're doing solar in Germany)
    - realityking 5y ago
      AFAIK this is only true if you pass the power you generate back to the grid - which most people did as it used to be heavily subsidized. If you run your solar without powering the grid, you won‘t be taxed on the used power.