The Magistrate's Tael: Rationalizing Fiscal Reform in Eighteenth Century Ch'Ing China - Hardcover

Zelin, Madeleine

Hardcover

ISBN 10: 0520049306 ISBN 13: 9780520049307

Publisher: University of California Press, 1984

Synopsis

Madeleine Zelin shatters the image of China as a backward empire wracked by corruption and economic stagnation, thrust into the modern world when the western gunboats arrived in the 1840s, by providing an account of the indigenous evolution of the Chinese state. The Magistrate's Tael makes it possible to judge the impact of the West on modern China's development.

About this title

About the Author

Madeleine Zelin is Professor of History and East Asian Languages and Cultures at Columbia University.

From the Back Cover

"An extraordinary feat: the best institutional study based on archives ever to have been done in the China field. It will set the standard for a generation of researchers."―Philip A. Kuhn, Harvard University

From the Inside Flap

"An extraordinary feat: the best institutional study based on archives ever to have been done in the China field. It will set the standard for a generation of researchers."—Philip A. Kuhn, Harvard University

Excerpt. © Reprinted by permission. All rights reserved.

The Magistrate's Tael: Rationalizing Fiscal Reform in Eighteenth Century Ch'ing China

By Madeleine Zelin

University of California Press

Copyright © 1984 Madeleine Zelin
All right reserved.
ISBN: 0520049306


1—
The Roots of Fiscal Instability

In the annals of late-imperial Chinese history, few emperors have achieved the fame of the second Ch'ing ruler, K'ang-hsi (1661–1722). His legendary humanity and benevolence as a ruler were given ample expression during a reign that lasted sixty years. Although the final decades of K'ang-hsi's rule were tainted by one of the most celebrated succession crises in China's long imperial past, he is best remembered as the emperor who brought peace to the land and restored conditions in which good government and the pursuit of learning could flourish. Little known or discussed is the negative legacy that K'ang-hsi bestowed on the empire. Yet the way in which this legacy was handled was to have a tremendous impact on the future of the Ch'ing dynasty and the development of the Chinese state.

When the K'ang-hsi emperor died in 1722 he left a state treasury containing only 8 million taels of silver.1 This sum, equal to about 27 percent of the central government's total annual tax revenues,2 could in no way be compared with the empty treasuries and royal indebtedness of K'ang-hsi's eighteenth-century European counterparts. Nevertheless, within the context of late-imperial Chinese economic thought such a figure was to be deplored. This was a political system that worshipped the balance of expenditure against

income and considered central-government reserves essential lest man be unprepared for the ravages that nature could bring.

Depleted treasuries were certainly not new to China. In fact, their existence was so common that they played a central role in the traditional "dynastic cycle" explanation of the collapse of imperial regimes. When the talents and virtue of the imperial line were declining, when officialdom was becoming corrupt, and when the pressure of population growth was beginning to strain the resources of both the land and the state, it was expected that the imperial coffers would shrink. The previous Ming dynasty had presented a classic case of fiscal strain, resulting in increased surtaxes, popular resistance, growing military expenditure, and finally, inability to cope with foreign invasion. However, in 1722 the Ch'ing dynasty was not dying. On the contrary, there had been no major internal disorder since the defeat of the Three Feudatories and the pacification of Taiwan in the 1680s. Under the devoted sponsorship of the late emperor, scholarship and the arts were once again approaching the high standards of previous dynasties. For the most part, almost eighty years of Manchu rule had won for the alien conquerors the confidence and loyalty of China's native population, especially the important scholar-gentry elite. To stimulate the economy and rehabilitate the areas devastated by nearly a century of rebellion and warfare, both the dynasty itself and private entrepreneurs were engaged in large-scale land reclamation and resettlement. Reforms were also being undertaken in administration and fiscal policy. The vigor of the dynasty was demonstrated even in the succession crisis, for the empire survived unscathed and even strengthened. The factionalism that surrounded the various princely contenders remained limited to small coteries of supporters and did not spread to engulf the entire bureaucracy. The emperor who emerged from the contest, Yung-cheng, was an independent, energetic, and able ruler whose achievements as monarch far outweighed the questionable means he may have used to accede to the throne. Clearly, this was not an era of imperial degeneration and declining official morale.

The strains on imperial finances had, in fact, been reduced since the early years of Ch'ing rule. At that time, even in areas firmly under imperial control, popular sentiment against the newly imposed barbarian authority continued to be reflected in tax resistance and arrears.3 Forty years passed before the whole of China was pacified and could be relied on for regular tax payments to the

imperial treasury. In the areas most affected by warfare and rebellion, notably Szechuan, it was not until the mid-eighteenth century that productivity, and consequently tax remittances, reached the levels realized during the Ming dynasty.4 However, none of these problems are comparable with the burdens imposed on early Ch'ing finances by the initial commitments of their conquest. Military expenditures used up most of the state's revenues during the early decades of Manchu rule. According to one estimate, of the 15.7 million taels spent during the first year of the Shun-chih reign (1644–61), over 13 million taels went toward military supplies and soldiers' pay. Furthermore, total expenditures exceeded the annual income of the court by almost a million taels.5 Under these conditions, little was spent by government on public works or the general welfare.

State revenues did increase by the end of the Shun-chih period, to almost 30 million taels by Shun-chih 17 (1660),6 though part of this new income had to provide for the increased expense of governing an expanded territory. One important element in these expenses was the payments made by the state to support the Three Feudatories which grew out of Manchu efforts to subdue parts of the empire's southern provinces. The Chinese generals sent to accomplish this task established instead quasi-independent satrapies which nevertheless continued to require provisioning and revenue support from the central government. During the Shun-chih reign that grant grew to 5 or 6 million taels per year. By the time of K'ang-hsi this sum had doubled and came to encompass about one-third of the annual income of the Ch'ing state.7 Thus, although the dynasty recognized the need to counteract official corruption and tax evasion, the main obstacle to fiscal stability during the years of Manchu dynastic consolidation was excessive expenditure, especially military expenditure. Once peace was restored in the realm, the expectation was that fiscal balance would be restored and that the size of the state's coffers would match the glory of the regime in other spheres.

When the Yung-cheng emperor came to the throne in 1723, that dream of a vigorous and prosperous empire seemed on the verge of realization. More than a generation had passed since a major military expedition had added its burden to the state treasury8 and the Manchu court itself was notoriously frugal, being loath to make the same mistakes as its profligate predecessor.9 When the new emperor looked at his father's treasury he did not revel in the accu-

mulation of 8 million taels, but was concerned about revenues several times that amount that should have been there but were not. Their absence was not the result of a dynasty spending beyond its means, but of a fiscal administration in which taxes that ought to have been sent to the central government were being dissipated elsewhere. Moreover, the Board of Revenue treasury was not the only one exhibiting shortages. The fiscal independence of the other government ministries in Peking, an inheritance from the Ming, had also left its mark. Even a cursory examination brought to light deficits in the stores of almost every treasury in the capital, in addition to serious discrepancies in central-government accounts.10

In some respects the problem of central-government finances was no more than a reflection of the developing crisis in provincial and local fiscal administration. If the central government was not receiving a large portion of its annual tax quota, it was because these lower agencies of the Ch'ing bureaucracy were not sending it on. Investigations into the state of provincial finances disclosed widespread arrears, some dating back a decade or more. Deficits in provincial and local treasuries were enormous. In Shantung the chou and hsien showed shortages exceeding 600,000 taels.11 Shansi equaled that sum merely by taking account of those deficits so old that those responsible were no longer living or so surrounded by corruption that the guilty parties could not be determined.12 In Kiangsi, the debts of individual officials ranged from ten thousand taels to as much as forty thousand taels each, and the unassigned deficit raised that province's liabilities by an additional one hundred twenty thousand taels. In Chekiang, the financial commissioner's treasury alone showed a shortage of three hundred thousand taels.13 Grain reserves also reflected the disorder in local finances. Granaries which according to the records were stocked to overflowing to guard against famine and to stabilize rice prices were found to be half empty. Some granaries did not exist at all except in the accounts of those officials charged with their maintenance.14

Behind the façade of Ch'ing power and prosperity was a fiscal system whose foundations were extremely fragile. Within a structure that was one of the most rational of its time, a fiscal tug-of-war was being waged between the central government and local governments, and between both and the representatives of the various interests among the local population on whom they depended. That the system had survived at all was a function of the

adaptability of those who participated in it. How much longer Chinese finances could have persisted in this way we shall never know. For in 1723 one of the first acts of the new emperor was to declare total war on deficits and those who caused them. How Chinese finances reached such a state we can begin to discern by looking back at the development of fiscal administration in the late Ming and early Ch'ing.

The Legacy of Late-Ming Fiscal Reform

Like most preindustrial societies, China relied on levies on the produce of the land for the major portion of its tax revenues. Therefore, it is not surprising to discover that China faced many of the same problems encountered by other states attempting to assess and collect a reliable income from a tax base composed largely of small agricultural units. Where China differed from both its Asian and its European counterparts was in the degree of bureaucratization of the tax system.

In England, China's chief nemesis in the nineteenth century, the crown had, by the eighteenth century, come to rely primarily on indirect duties on the commercial sector of the economy. More comparable to China are France and Japan. In Japan, direct taxes on the land continued to be the main source of daimyo income, but collection was based largely on community self-assessment of tax quotas set in the han capitals. In France, not only the land tax, but commercial taxes as well, were collected primarily by tax farmers, who had a legitimate role within the French fiscal system. In both instances, the state's main interest was receipt of its quota. In the case of Japan, the solidarity of the village unit and the fact that the rural elite had been largely removed to castle towns seem to have prevented gross inequalities in assessment. These factors, as well as the already high rate of Japanese land taxes and the comparatively small size of Japanese administrative units, can probably account for the low level of corruption evident in the tax system. On the other hand, in France the chronic royal shortage of funds due to the twin demons, waste and warfare, made the French government willing to mortgage its taxes to tax farmers who would advance funds to the court on the strength of future receipts. In none of these countries was a large bureaucracy employed to determine the productivity of the land and who owned

it, and to collect from each individual taxpayer the government's share. Likewise, in each of these three states those who governed below the level of the central government did so largely with their own resources and formed a power base separate from the throne.

In China, the state was also concerned with collecting its quotas, but here the early growth of the bureaucratic state, the demise of a feudal-style aristocracy, and the relative weakness of rural communal institutions were combined with increasing rationalization of the tax-collection process, culminating in the highly centralized fiscal structure of the early Ch'ing. Tensions certainly existed between local, provincial, and metropolitan interests, but at least in theory China's vast territory was administered by a unified civil service, funded by taxes collected by and for the government itself. To a large extent it was the very sophistication of the Chinese bureaucratic and fiscal system that was its downfall.

By the eighteenth century, the main source of funds supporting the Chinese bureaucracy came from the land and head tax (ti-ting ch'ien-liang ). For the most part, this and other direct taxes were collected by county-level magistrates with the aid of clerks and yamen runners who, with the exception of a small number of the latter, were unsalaried, though regular members of the subbureaucracy. Technically, all such revenues were the property of the central government. However, as we shall see, a portion of these taxes was left in the provinces to pay official salaries as well as certain local- and provincial-government expenses. Hence, on paper at least, China had one of the most rational and centralized fiscal administrations in the world.

This had not always been the case. During the Sung dynasty (960–1278) provincial-government expenses were derived largely from the income of official estates granted to the incumbent for the duration of his term in office. By the Ming dynasty this system had been eliminated, but the distinction between public and private in fiscal matters was still unclear. Only slightly less ambiguous was the distinction between central- and local-government revenues. Although taxes were classified as either ch'i-yün (those to be sent to the central government) or ts'un-liu (those to be retained by the locale), these terms were often applied arbitrarily and items covered by each varied.15 Even retained income could be earmarked for the purchase of local products for shipment to the capital,16 and inasmuch as all deposits in granaries and treasuries were considered ultimately to be the property of the emperor, no funds could

be disbursed without an imperial decree.17 At the same time, within the central bureaucracy each ministry received its own income directly from a multiplicity of tax-distribution points throughout the provinces. What seems to have saved this system from collapse was the predominance of taxation in kind and the existence of corvée obligations among the local populace, which provided local government with ample material and manpower resources.

Despite the government's claims to centralized control of tax utilization, the Ming fiscal system as a whole was very decentralized. This contradiction can be chiefly attributed to the founder of the dynasty, who saw the Chinese economy as eternally undifferentiated and nonexpanding. This vision, combined with his distrust of bureaucrats, found its expression in the main vehicles for Ming tax collection and assessment, the li-chia and liang-cbang .18 Both of these innovations were designed to protect the rural population from illegal claims on their resources and guarantee the delivery of taxes to the central government. This was to be achieved by reducing the influence of local government in the tax-collection process and by increasing local self-regulation. In the end they did neither, but though they gradually disappeared as formal taxation devices, many of the problems in Ch'ing tax collection evolved from them.

Under the liang-chang system, collection of the grain tax and its transportation were completely removed from the magistrate's control and relegated to local magnates whose personal wealth was sufficient to ensure that taxes would be remitted in full. However, largely as a result of its independence from the local administration, this system provided rich opportunities for the development of tax farming. The establishment of a separate tax-collection structure with its own staff could have provided the foundation for a specialized tax administration. However, the fact that the post of liang-chang was considered a kind of corvée, and was never integrated into the regular administrative hierarchy, deprived it of its rationalizing potential.19 By 1421, with the increasing monetization of the economy and the transfer of the capital away from China's riceproducing heartland to Peking, the liang-chang system began to decline in importance. Its tax-collection functions were gradually taken over by the li-chia , and the ultimate receipt and transportation of the taxes to the capital once again became the duty of the magistrates.20

Though the li-chia originally played an important part in the al-

location of corvée, by the late Ming it was primarily a system of rotating responsibility designed to prompt tax payments (ts'uik'o ). Responsibility for the tax quota of an entire artificial "neighborhood" fell to the incumbent holding the rotating post of li-chia headman. Few commoners wanted this job, because failure of one's "neighbors" to pay their taxes in full often resulted in bankruptcy for the headman's household. However, by interposing an informal tax-collection structure between the individual and the state, the li-chia made possible the arrogation of this tax-prompting power by unscrupulous gentry and commoners who saw in it a chance for profit. This was usually accomplished with the tacit consent of the magistrate, whose sole concern was to see that the tax quota was remitted in full. The result was frequent falsification of the receipts given to taxpayers and the collection of illegal surcharges on a large scale.21

During the last few decades of the sixteenth century a series of measures were undertaken independently by a number of officials throughout China, aimed at alleviating some of the weakness of the Ming system of tax collection. Known collectively as the Single-Whip reforms, these measures were designed to simplify and consolidate the diverse taxes levied on the people and to convert payments in kind and in labor service to payments in silver. Unfortunately, a lack of centrally directed coordination of the reforms meant that commutations were often confused and arbitrary and rates varied from place to place. Although tax payments were commuted to silver, the myriad categories into which they had been divided when paid in kind remained. As the censor, Liu Yintung, pointed out in the first year of the new Ch'ing dynasty, "There are hsien with a regular quota of around three thousand taels, but it is divided into over forty designations. One item may require payment of only 1.6 or 1.7 taels, but surcharges of twenty or thirty taels are added on."22 Nor was any effort made to consolidate the large number of agencies to which the taxes from a particular place were due.23 Moreover, the failure to deal with inequalities inherent in the head tax led to a series of localized efforts at equal corvée which extended from the sixteenth century well into the period of Ch'ing rule.24

What the Single-Whip reforms did accomplish by converting taxes to cash payments, was to subject local finances to a degree of scrutiny that was inconceivable when taxes consisted largely of goods and services. If Ch'ing peacetime deficits were more shock-

ing or attracted more attention than those in the past, it was in part because they were more visible. Still worse was what this visibility meant for the operation and financing of local government. Prior to the Single-Whip reforms, the staffing of local yamen and the provision of stationery, firewood, and so on was carried out through corvée labor and levies in kind. So long as these goods and services were provided in kind, there was considerable flexibility in local fiscal management and it was very difficult for agencies outside the locale to ascertain the extent of such resources or try to take a share. Once they were commuted to silver, the logistical obstacles to commandeering local revenues were overcome. As a result, the central government, the army, and even members of the imperial household began to appropriate the resources once used to operate local administrative units.25 The effect was to leave local government with a bare minimum of legal sources of funds at its disposal. Expected now to hire yamen staff and purchase yamen supplies, local and provincial officials gradually worked out a new system of funding, one that was responsible for much of the shortages and corruption that plagued the bureaucracy in 1723.

Bureaucratic Solutions to Structural Problems

Until the eighteenth century, few men in a position to influence imperial policy recognized or were willing to acknowledge that it was genuine need among local- and provincial-level officials that prompted irregularities in the Chinese fiscal system. For many years, temporary but far more immediate causes of shortages, such as war and rebellion, tended to mask the defects in the system itself. Moreover, the success of the local bureaucracy in compensating for its difficulties, at least for the time being, made the paucity of funding available for local use seem less acute than it was. However, most important was the political economy of traditional China. Formulated at a time when taxes were paid in kind, when officials still came from a privileged class with independent means, when informal or customary claims on the labor and productivity of the masses were generally recognized, and when little was expected of government, it now perpetuated myths that no longer accorded with Chinese realities.

Kuo-chi min-sheng were the watchwords of Chinese political economy in imperial times. Translated in modern terminology as

fiscal administration and people's livelihood, they are better understood as a dual exhortation to provide enough taxes for the government to function without depriving the people of the means of subsistence. Because government was seen as existing to transform not the physical landscape but rather the moral landscape of the kingdom, it was not unreasonable that low taxation would be seen as a basic principle of good government.26 Rule by moral example was an inexpensive form of government. If the ruler, and by extension his representatives in the field, were virtuous, the populace would follow suit. Small outlays would be necessary for waterworks and for armies directed at external enemies, but large internal peacekeeping forces would normally be unnecessary, the people would be hardworking and content in their occupations, and harmony would reign over the land.

Of course, such ideal conditions rarely existed, but they did produce a formula for evaluating fiscal matters that was accepted by most officials in late-imperial times. Given the low level of taxation in China, it was expected that the people would pay their taxes in full. If they did so, officials need only manage the proceeds frugally for both the state and the people to prosper. If, instead of prosperity, the government was faced by mounting deficits, it could be due only to two factors: either taxes were not being received from the people or they were being received and subsequently dissipated through mismanagement or official peculation.

Beliefs such as these were not conducive to a fundamental restructuring of the imperial system of taxation and finance. Rather, reformers tended to attack each symptom individually in a manner that kept the basic framework of government finance intact. This is not to belittle the importance of such changes, as we shall see in the case of the reforms undertaken in the early Ch'ing.

Officials could and often did use the pretext of taxpayer default to cover a myriad of their own fiscal misadventures. In late-imperial China, however, claims that taxes had never reached the magistrate's yamen were to be taken seriously. In an economy chiefly composed of small landholders, where even the very wealthy generally owned no more than a few hundred acres, taxpayers were particularly vulnerable to the vagaries of nature. Flood or drought could easily deprive whole counties of the ability to pay their full quota. Most dynasties dealt with temporary disabilities of this kind by granting tax remissions and by allowing the less fortunate to spread their liability out over a number of years. This sort of

taxation on the installment plan became extremely widespread during the Ch'ing for dealing with arrears of all kinds.27 The frequency of natural disaster and the remissions and relief that they necessitated constituted one of the reasons that Chinese governments would prefer to keep a net surplus and not simply a balance of expenditure and income in their treasuries.

Less easily controlled were instances of deliberate nonpayment. Grouped under the category of tax resistance (k'ang-liang ) in the tax codes, these could range from refusal to pay taxes as an open political protest to secretly bribing yamen personnel to lower obligations or expunge arrears from the yamen records. Once these moves were discovered, however, punishment coupled with retrieval of the arreared sum was the usual prescription. Real inability to pay could be wrongly assigned to this category and dealt with in the same way, especially when an area failed in its petition for disaster-zone status, when tax records were tampered with so that an inordinately large portion of the quota was levied on a locale's weaker inhabitants, or when surtaxes and illegal levies made it impossible for the peasantry to pay its regular tax obligations.

Both of the above instances concern the failure to pay taxes. Far more insidious were cases where the taxpayers had fulfilled their obligations to the state, but the state received little or none of the funds collected. Such cases usually involved embezzlement by intermediaries and were grouped under the heading of pao-lan or tax farming. Tax farmers were local yamen functionaries, members of the local elite, or simply local gangsters who contracted with the peasants to collect and pay their taxes for them. In its purest form this meant that, in return for a small fee, the peasant was saved the time and expense of carrying his taxes to the county seat. However, peasants often were coerced into entrusting their taxes to tax farmers or were prevented from turning in their own taxes by strongmen who, in cooperation with local yamen functionaries, controlled the county's tax-collection centers.28 In either case, the tax farmer could keep all or a portion of the taxes collected, depriving the government of its quota and making the taxpayer appear to be in arrears.

Even when the government did receive the people's taxes, this did not guarantee that the full amount would be applied to the functions of government for which they were intended. Between collection and allocation or remittance to the central government there were numerous opportunities for the dissipation of such

revenues through official mismanagement, extravagance, or outright theft by the official or members of his staff. It was to overcome the depredations of these fiscal parasites that many of the early Ch'ing reforms in tax collection and assessment were introduced.

Centralization of Tax Accounting

At first glance there seems to be little to distinguish Ch'ing fiscal administration from that of its Chinese predecessors. The same taxes levied by the Ming and delineated in the Comprehensive Books of Taxation and Services (Fu-i ch'üan-shu ) were adopted by the new government and made the basis of its own finances. The division of taxes into ch'i-yün and ts'un-liu and the relative shares allocated to central and local government were also a readily accepted legacy of the Ming. After nearly a century of war and rebellion, the most important measures undertaken by the Manchu conquerors were those aimed at promoting productivity and agricultural recovery. None of them involved any fundamental restructuring of the fiscal apparatus, but rather they employed traditional methods of expanding the tax base while relieving the tax burdens on the people. Land reclamation was encouraged by means of both tax exemptions and rewards of official rank to those who succeeded in resettling large numbers of people on barren land.29 The court itself was careful to exercise austerity in its own expenditure. Imperial benevolence was manifested in frequent tax remissions. And, as the supreme sign of the new dynasty's good will and adherence to the dictates of traditional Chinese political economy, in the last decade of his reign the K'ang-hsi emperor paid tribute to the infinite fecundity of man and the finite area and productivity of land by freezing the head tax at the 1711 level.30 Yet behind this façade of continuity there were taking place several important changes that set the stage for the fiscal crisis and the reforms of the Yung-cheng period.

If the fiscal system established by the Ming founder was characterized by decentralization and the substitution of informal for formal mechanisms of control, the system that evolved during the early Ch'ing was the opposite. The first generation of Chinese under Manchu rule witnessed the gradual development of a highly centralized system of tax administration and the evolution of a new, direct relationship between the taxpayer and the government.

As a first step, the Ch'ing founders attempted to resolve much of the chaos inherent in the Ming tax structure by placing all taxes delineated in the Fu-i ch'üan-shu under the direct control of the central government. Instead of having each ministry of the central government collect and manage its own revenues from the provinces, all central government funds were now to be supervised by the Board of Revenue.31 Moreover, under the first Ch'ing emperor the Ming proliferation of tax categories was eased and large numbers of taxes were consolidated, with the result that the opportunities for corruption and the confusion they entailed were eliminated.32 Further refinement was undertaken by K'ang-hsi, who ordered the simplification of Fu-i ch'üan-shu registration33 and the elimination of tax categories for which there was no longer any basis in the Ch'ing economic structure.34 All of these measures simplified the collection of taxes and helped eliminate some of the local idiosyncracies in the tax administration that had made central government supervision almost impossible.

Probably the most far-reaching innovation of the early Ch'ing fiscal system was the institution of "annual accounting" (tsou-hsiao ). It is also the best example of the Manchus' more centralizing approach to government. Even before their entry into China, the Manchus had begun to investigate their own finances at the end of every year. However, the comprehensive system of fiscal auditing that eventually bore the name tsou-hsiao chih-tu was equally a product of the changes in fiscal administration carried out during the last years of the Ming and the first years of Ch'ing rule. Given the technology of the eighteenth century, only a tax system based mainly on cash payments, divided into relatively standardized and simple categories and collected and distributed through a clear and direct hierarchy of officials, could sustain detailed supervision of this type.

The basic parameters for annual accounting were established during the early years of the Shun-chih reign. In SC 3 (1646), the emperor ordered the Board of Revenue to investigate each category of taxes received by each yamen in the capital, with special attention to be given to how much the original Ming quotas had been and how this income was now received and allocated. At the same time, the Board was told to supervise similar investigations in the provinces. Their purpose was to find out the extent to which the people were still being burdened by surtaxes instituted to cover military costs in the late Ming, and, in a more general vein, to find

out how much land was currently under cultivation, and how taxes on that land should be collected, remitted, and retained by local government.35

More than anything, the 1646 edict indicates how little the government knew about the practical working of its own fiscal administration. It was not until five years later that Metropolitan Censor Wei Hsiang-shu memorialized the emperor to request that the supervisory functions of the Board of Revenue be regularized through annual reports on finances from the provinces.36

The expenditure of state taxes is controlled by the Board officials and income is controlled by the provincial financial commissioner. The amount of income is not clear. Therefore, the amount of expenditure is not clear. I request that starting in SC 8 (1651), the financial commissioner of each province, at the end of the year, calculate the taxes of the entire province and compile an itemized account to be presented to the governor, governor-general, and judicial commissioner for auditing. On the one hand the governor shall compile a routine memorial with the totals and send it along to the Emperor with a "yellow account" (huangts'e ) for his perusal. Another "clear account" (ch'ingts'e ) shall be compiled and sent to the yamen in the capital for auditing. In this way we can prevent duplicity on the part of the financial commissioners and also check on the irregularities of Board officials.

In SC 9 (1652), the practice of sending annual accounts of paid and unpaid taxes to the Board was approved.37 Once the principle of annual Board audits was established, further legislation concentrated on refining the rules governing deadlines for reporting, items to be reported, responsibility for verification of accounts, and punishments for falsification and delays.

Some sense of the nature of these refinements can be obtained by examining several orders promulgated under the K'ang-hsi emperor. In KH 11 (1672), the emperor became concerned about the failure of officials to investigate discrepancies in accounts. He ordered that thenceforth, in the reports of the annual accounts (tsou-hsiao ts'e ), the total taxes reported collected by the chou and hsien must correspond to the amounts found in the lists sent to the people to inform them of their tax obligations. Furthermore, the actual amounts collected, the original quotas, the financial commissioner's totals, and the detailed figures submitted by the chou

and hsien had to tally.38 Such data would seem to be a minimum requirement for accurate audit of provincial finances. That the emperor saw fit to issue an edict specifying their inclusion indicates that considerable confusion existed as to what information was required by the Board. Moreover, by requiring submission of accounts at each level of the administration, an attempt was clearly made to institute a system of checks to avoid embezzlement or fraud at any level.

This system of surveillance was further clarified in KH 28 (1689). At that time, regulations were established whereby a governor or governor-general would be punished for failure to memorialize deficits in the provincial treasury and to impeach the officials responsible. An edict was also issued requiring that the governor of each province personally inspect the provincial treasury each year at the time of the annual accounting. When there were no deficits, this fact was to be memorialized and commendations requested for the officials who had filled their quota. In addition, at the end of the year, each prefect was to compile an account of the items collected and approved for delayed collection in the chou and hsien under his jurisdiction, and investigate them personally. When cases of "collecting more and reporting less" (cheng-to pao-shao ) were discovered, it was the duty of the prefect to report this immediately to his superior.39 Responsibility for investigating other revenue stores was also codified. Taxes kept in the treasuries and granaries of the grain intendant and post intendant were to be inspected by the financial commissioner. Those stored in the various prefectural treasuries and granaries were the responsibility of their respective circuit intendants (tao ). Where no deficit or arrears were found, the prefects were to be recommended to the governor, who would issue rewards to express encouragement.40

This allocation of supervisory responsibility was to take on particular importance when large-scale inquiries of deficits and arrears (ch'ing-ch'a ) were undertaken later in the dynasty. Responsibility for making good shortages was placed on the official himself if the shortage had been reported by his superior at the time it occurred. However, in cases where shortages had not been reported, whether due to negligence or cover-ups, the supervisory official was also required to share in repayment (fen-p'ei ) and was occasionally charged an additional fine at the rate of as much as ten times the original amount due.41

The primary focus of the annual accounting system was the ti-

ting ch'ien-liang , those taxes derived directly from levies on the population by head and from private land under cultivation. Not only was this the largest single source of central-government revenue, but its volume was fixed by quota and was therefore more easily controlled.42 In addition, it was the one source of government revenue that was shared statutorily with the provinces in the form of "retained taxes." Inasmuch as the purpose of the tsou-hsiao system was to control both income and expenditure, the ti-ting ch'ien-liang was obviously given special attention. In response to a memorial in KH 7 (1668), the special nature of the land and head taxes in relation to the tsou-hsiao reports was clearly outlined.43 All taxes collected by the chou and hsien but not emanating from the ti-ting were to be reported in the same manner used prior to the reform. These included the salt gabelle, duties on tea, customs duties, the reed-land tax, tribute grain, tribute presented by local aboriginal chiefs, miscellaneous duties, the pawnshop tax, contract tax, brokerage tax, taxes per head of livestock and mules, fines and payments to atone for crime, and so on.44

At the end of the year, the magistrate compiled detailed accounts of the taxes collected and those still outstanding in his chou or hsien. These accounts were then turned over to the financial commissioner, sometimes through an intermediary such as the prefect or circuit intendant. The financial commissioner himself drew up the four-column accounts for the whole province, listing the balance to be carried forward, new receipts, expenditures, and the present balance. In turn, he submitted a draft to the governor or governor-general, whose staff transcribed it in the form of a "yellow account" for the emperor and a "clear account" for the Board. These reports included a summary of how much ti-ting ch'ien-liang was collected, how much was paid and in arrears, how much was remitted to the capital and retained in the province, how much was transferred to the military, how much was used to buy local products for the capital, and how much was left over.45

This new system of auditing not only meant that provincial officials had to justify their accounts at the end of the year, but also gave the Board of Revenue authority over the way in which local revenues were used on a day-to-day basis. Although enforcement must have been difficult, the law now required that no local retained funds could be allocated without prior Board authorization. Even funds that had been so budgeted could not be disbursed until another report had been made indicating the exact amount

that was required at the moment of allocation.46 At the end of the year, the Board compared the local official's annual accounts against these "receipts" in the capital to make certain that all items of income and expenditure balanced, and that all expenditures had been approved in advance.47 After an item-by-item audit, the Board would either accept the accounts (chun ) or reject them (po ) and return them to the governor for revision or clarification. Although the work of verification and compilation was carried out at lower levels of the provincial administration, culminating in the financial commissioner's report, the ultimate responsibility for promptness and accuracy again lay with the governor and governor-general. If a magistrate was found guilty of delaying his tsou-hsiao report, or of compiling confusing accounts designed to conceal fraud, he was to be impeached immediately by the governor or governor-general. If the latter failed to report irregularities perpetrated by their subordinates, or were lax in their supervision and failed to discover malfeasance that was later revealed, they were held jointly responsible.

In view of the large number of deficit cases uncovered in the first years of the Yung-cheng reign, the efficacy of this system of centralized control may be doubted. As we shall see, it was possible to evade careful scrutiny of accounts by bribing the Board officials and clerks. Moreover, the penalties for delays were minor and were prorated according to the length of the delay.48 Sanctions for discrepancies were also light, ranging from demotion of one grade and transfer for a magistrate or prefect to a fine of one year's salary (feng-yin ) for a commissioner or circuit intendant and six months' salary for a governor or governor-general.49 This was not considered a great hardship, inasmuch as feng-yin was itself a token sum.50 Moreover, during part of the K'ang-hsi period, official salaries were suspended to help pay the costs of pacification campaigns.51 Even when they were granted, the salaries of officials and yamen staff were often arrogated in full or in part by the governor to pay for expenditures not covered by ts'un-liu funds, a practice euphemistically called chüan-feng or "contributions of salary."52

However ineffective this system of scrutiny may have been in the early years of the dynasty, it did establish a standard for local and provincial accountability in the area of public finance that was strengthened under later emperors. In particular, it marked a further refinement of the Ming system by placing supervision of both collection and expenditure under one agency. Not only did this

contribute greatly to the centralization of fiscal authority, but it also enhanced the central government's interest in improving tax-collection and local-accounting procedures. The form of the tsou-hsiao ts'e itself can be seen as contributing to the development of local budgets. Moreover, without such a system, the investigation of deficits undertaken in the Yung-cheng period would have been impossible. Finally, by placing all legitimate income clearly under the control of the central government, the tsou-hsiao system of annual accounting also contributed to the crisis in local funding that led to the reorganization of provincial finances in the early eighteenth century.

Centralization of Tax Collection

The aim of the tsou-hsiao system of annual accounting was to prevent revenue loss resulting from official waste and corruption. However, the early Ch'ing government also devised methods to rectify the defects in the Ming fiscal apparatus that had prevented taxes from ever reaching the local and provincial coffers. Whereas the Ming had attempted to utilize local elites as instruments of government policy and had failed, the Ch'ing remained committed, until the nineteenth century, to the principle of a direct relationship between the government and the people. In the realm of tax administration this meant waging an unending campaign against both official and nonofficial intermediaries who took on the role of tax farmer, and creating an informed public that could both do without such middlemen and resist their efforts at control of tax collection.

The first step in this direction was taken as soon as the Manchus entered China. In part because the dynasty had not yet been able to compile its own editions of the Fu-i ch'üan-shu , the new rulers turned to the use of "easy-to-read lists" (i-chih yu-tan ) to inform taxpayers of their annual rates. Yu-tan were not unknown in the Ming dynasty. However, the memorialists requesting the use of "easy-to-read lists" in 1644 placed a new emphasis on their effectiveness in cutting through the confusion of regulations, quotas, and tax rates as they appeared in the Fu-i ch'üan-shu . This was not intended as a mere stopgap, but as a way to improve tax collection in the long term by providing both officials and taxpayers with an easily understood enumeration of the actual amount of taxes each household owed.53

Whatever the hopes of its original formulators, the system of ichih yu-tan failed as a panacea for China's fiscal ills. By KH 24 (1685) they were discontinued because officials and yamen runners were found to be using the costs of their production as a pretext to levy surcharges on the people.54 In place of the defunct "easy-to-read lists," the emperor ordered all county-level administrative units to set up stone tablets in front of the yamen informing the people of the tax rates in the vicinity according to the Fu-i ch'üan-shu .55 Unfortunately, this system once more left the peasantry prey to the machinations of middlemen, because few villagers made regular trips to the county seat where they could see these tablets. Even those who did undertake such a journey would still have to estimate their own personal liability and manage to insist on that amount in the face of the conflicting and often much larger claims of yamen runners and tax-collection clerks. Thus, the task facing government was twofold—to find a new way to inform the peasants of their individual tax liabilities and to free the taxpayer from those institutions that perpetrated the hold of middlemen over them.

The most culpable of such institutions was the old Ming li-chia . By the early Ch'ing this system of rotating responsibility for tax remittance had become little more than a vehicle through which local strongmen and bullies (hao-lieh chien-kun ) took control of an area's taxes. Domination of the collection process by third parties fostered extortion. In some places the practice of levying surcharges through the li-chia was so well established that the methods used had even been given names. If all the li in a hsien shared in the annual payment of these fees it was called juan-t'ai . If, on the other hand, each li and chia took turns paying, it was called ying-t'ai .56 Whatever the name, the result was the same: added burdens for the people and diminished revenues for the government.

The means devised to overcome these malpractices was the system of "rolling lists" (kun-tan ). Unlike the "easy-to-read lists," "rolling lists" were not simply grafted on to the li-chia , but were meant to replace them. Under this new system, households were still grouped together in units called li . However, the Ming arrangement of households into artificial decimal units, regardless of physical proximity or social relationship, was abandoned. "In a single hsien, a li might have five households or ten households."57 The basis for establishing these new units was that they be natural

groupings of households whose relationships with each other went beyond tax collection. The kind of information provided on the "rolling lists" was also more extensive than the system they replaced. Under the name of each household in the li was clearly delineated the amount of land its members owned, how much tax was due on that land in silver and in kind, how much should be paid in the spring collection period, and how much should be paid in the fall. These payments were then further divided into ten installments and the amount due in each installment was also set out in detail.

The most important feature of the "rolling lists" was not what it was, but what it was not. It was not a system of collecting taxes. It was only a means of notifying the taxpayers of the taxes due. In the edict promulgating the use of "rolling lists," special emphasis was placed on informing the populace that each taxpayer was to wrap his own taxes and deposit them personally in the county tax chest. No one was permitted to act for the people in this regard, whether it be the old li headman, silversmiths, yamen personnel, or any other third party. The "rolling lists" would guarantee tax payments not by making one man responsible for delivery of everyone's taxes, but by making rotation of the list itself contingent upon each household's fulfilling its obligations to the government. The list containing all of the above-mentioned information would be issued to the first name and passed on in turn to the others. As the list came to each household it was to pay its individual tax. When one installment period was completed, the list was passed around again for the second period. If a taxpayer destroyed the list, did not pay in full, or failed to pass the list on to his neighbor, he as an individual was to be investigated, arrested, and severely punished.58

If taxpayers were to be responsible for wrapping and depositing their own taxes, in turn they had to be protected against false accusations of arrears. Under the system inherited from the Ming, chou and hsien magistrates entered the amount of tax received from each taxpayer on special receipts bearing the magistrate's official seal (yin-p'iao ). Two copies were made for each payment. One was kept by the magistrate and one was given to the taxpayer as proof of payment. Abuses were common. Most often, on the pretext of needing the second copy to provide yamen runners with evidence when investigating and prompting payment of arrears, taxpayers were deprived of their own copies. Unscrupulous offi-

cials and clerks would then record the paid taxes as unpaid or would record payment at less than the amount actually collected.59 The helpless taxpayer was left with no recourse but to pay his taxes a second time or produce a bribe in order to avoid being harassed by tax-prompting runners.

To solve this problem, "three-stub receipts" (san-lien yin-p'iao ) were introduced. Each receipt had three sections. One was retained by the magistrate, one was turned over to the taxpayer as proof of payment, and one was kept by the yamen runners to compare with the other two in prompting payment of arrears (ying-pi ).60 It was hoped that the addition of one piece of paper would not only deprive the magistrate and his underlings of any pretext for withholding taxpayers' receipts, but would also ensure the magistrate's superiors of a record against which to compare the former's remittances to the capital.

Imperial Benevolence and Fiscal Administration

"Rolling lists" and "three-stub receipts" represented an important advance over the Ming system of tax assessment and collection. By placing the emphasis in tax collection on the individual household in a direct relationship with the government, these early Ch'ing reforms served as a local counterpart to the centralizing efforts within the bureaucracy manifested in the tsou-hsiao system of annual accounting. Yet, just as the latter was plagued by evasion and manipulation, so did "rolling lists" and "three-stub receipts" fail to wipe out tax farming and the oppression of the masses by rapacious yamen functionaries.

Seeing the problems facing them strictly in terms of tax evasion and bureaucratic corruption, late Ming and early Ch'ing reformers naturally sought to root out the sources of government shortages through refinements in the existing system of imperial finances. As important as these refinements were, they were all bureaucratic solutions to what were perceived as fundamentally bureaucratic problems. The weakness of such measures is epitomized in the case of the three-stub receipt. When, in the Yung-cheng period, this system was found inadequate in preventing official and clerical corruption, it was replaced by the four-stub receipt. But even a ten-stub receipt would not have solved the problems that gave rise to this corruption in the first place.

One source of difficulty was the laxity with which the govern-

ment handled offenders. We have already seen that the sanctions accompanying the implementation of annual accounting were insufficient to dissuade the most determined officials from exceeding deadlines and tampering with their fiscal records. As will be seen, the incomplete state of most tax registers after the long period of dynastic transition also impeded the government's efforts at fiscal control.61 The existence of such obstacles could only have contributed to the K'ang-hsi emperor's personal leniency as a ruler, a trait for which he was famous. For K'ang-hsi, gaining the confidence and support of the local elite and the overwhelmingly native Chinese bureaucracy was as pressing a task as increasing government revenues. Leniency, as a personal quality, may have suited the emperor's temperament, but in the early years of the dynasty its importance was clearly political.

Leniency was common in the handling of both of the traditionally recognized causes of government shortages. When the level of unpaid taxes rose too high, the K'ang-hsi emperor would simply declare a tax amnesty. For example, in KH 43 (1704) the emperor cancelled all the tax debts of the entire populations of Shansi and Shensi. In KH 50 (1711), he excused Chihli, Fengtien, Chekiang, Fukien, Kwangtung, Kwangsi, Szechuan, Yunnan, and Kweichow from 8,377,100 taels in land and head taxes. At the same time, in order to lessen the burdens on the people, the emperor cancelled accumulated arrears of more than 1,185,400 taels.62

Even in cases of obvious official corruption, K'ang-hsi seems to have been exceedingly hesitant to apply strict disciplinary sanctions. In 1685, the Director of Grain Transport memorialized on corrupt practices in the shipment of tribute grain to the capital. The Council of Ministers deliberated the case and recommended the impeachment and removal of the officials involved, but the emperor's edict on the affair advised instead that the guilty parties simply be given a stern warning against any future repetition of such activities. As malfeasance of the kind they were accused of had long since become common practice, it was, K'ang-hsi felt, unfair to single these men out for punishment. The emperor was equally lenient in the face of mounting official deficits. Despite regulations requiring officials to repay all deficits incurred during their terms in office, he ruled in a case in 1702 that such repayment was too difficult and asked that the Grand Secretariat find another solution to the problem.63

An excellent example of the more "benevolent" approach taken toward tax offenders during the K'ang-hsi period can be seen in the handling of so-called "hidden lands" (yin-ti ). Hidden lands were the product of the widespread concealment of newly reclaimed land from the tax registers. Some of this concealment was perpetrated by individual peasants who reclaimed small plots and either deliberately or through ignorance of the law never reported them to the authorities. However, according to later investigators, much of the land was reported to the officials, who themselves collected the taxes and did not report these additions to the tax rolls to the central government.64 Thus, the problem of hidden land can be seen as encompassing all of the defects in early Ch'ing fiscal administration: incomplete records, tax evasion, and official peculation.

In KH 51 (1712), an exchange of views took place that highlighted the contrasting approaches advocated on the issue of hidden land.65 The debate developed over the poor progress being made by Szechuan province in restoring its tax income to that collected during the late Ming.66 The original quota was 1,616,600 taels. However, by 1710 the most that could be wrung out of the province was 202,300 taels. Szechuan Governor Nien Keng-yao was appalled that after nearly seventy years of Ch'ing rule, revenues in the province had been raised to only a little over 10 percent of what they had once been. In part, he blamed officials who used the occasion of reporting new land for taxation (shou-liang ) as a pretext to extort fees from the people. Consequently, the people often did not report reclaimed land.

Nien took a hard line on the problem. The only way to ensure increasing quotas was a strict policy of rewards and punishments. He suggested, therefore, that promotions be granted to all chou and hsien magistrates who could increase tax collection to 40 or 50 percent of the Ming quota. On the other hand, promotion would be blocked for those who could not reach at least 20 percent of the quota. Any official failing to collect even 10 percent of the taxes collected in the Ming would be demoted and transferred, and those showing no increase over present levels would be deprived of their rank and office.

A more moderate approach was advanced by the censor Tuan Hsi. Tuan pointed out that the main cause of Szechuan's low level of tax revenues was the depopulation that had occurred in the province during the uprisings of the late Ming. Even a diligent gov-

ernor like Nien himself had been able to add only 26,000 taels to the tax rolls. Whereas Nien would claim that the wealth, in population and cultivated land, was there to be tapped if only the law gave him the weapons to do so, Tuan felt that such a policy would benefit only the corrupt. Virtuous officials would find these figures impossible to achieve and would be impeached. Unscrupulous officials seeking promotion would force the innocent to confess to hiding land they did not have in order to reach the magic numbers they needed. Even though Tuan's plan supported a thorough investigation of hidden land and omitted taxes (yin-lou )67 and punishment of any official who used the process of reporting new land to engage in extortion, its main emphasis was moral exhortation. Raising Szechuan's quotas could be accomplished only by ordering officials to encourage the people wholeheartedly to report their land and by punishing those who evaded taxation. Nothing was said of those officials who succeeded in getting the people to declare the fruits of reclamation but who never passed this added income on to the state.

Needless to say, it was Tuan's method of gentle persuasion that was endorsed by K'ang-hsi. Benevolent rule was upheld, but hidden land, along with other forms of embezzlement and tax evasion, continued to be a problem long afterwards. Nevertheless, it was not simply laxity that led to the deficits discovered by Yungcheng when he inherited the empire from his father. Had that been the case, the strengthening of sanctions and the tightening of official discipline imposed by Yung-cheng from his first day as emperor would have been enough to solve China's fiscal problems and the reforms of the 1720s would never have taken place. It was certainly with no more ambitious prescription in mind that the new emperor initiated his attack on the fiscal chaos that was his birthright. Once the campaign was launched, it disclosed weaknesses in the Ch'ing fiscal system that went far deeper than anything admitted by the formulae of the traditional political economy and would require far more fundamental changes than the patchwork refinements and exhortations to virtue so popular in the past.

Continues...

Excerpted from The Magistrate's Tael: Rationalizing Fiscal Reform in Eighteenth Century Ch'ing Chinaby Madeleine Zelin Copyright © 1984 by Madeleine Zelin. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Edition details

• Publisher: University of California Press
• Publication date: 1984
• Language: English
• ISBN 10: 0520049306
• ISBN 13: 9780520049307
• Binding: Hardcover
• Edition number: 1
• Number of pages: 392