Introduction
The Ottoman Empire was ruled from the top by a Sultan. A collection of taxes was an eternal problem in this empire so they came up with a tax farming system whereby tax collectors were employed to collect taxes in the entire empire. The system brought about various mistreatments and the poorest received very heavy tax burdens, they did not have the capability of avoiding taxes or bribe off the tax collectors. A segment of the population lived under the millet system and it consisted of the Jews, Christians and Religious minorities who run their own schools, local communities were in their control and settlement of dispute among their members was in their control. The Ottoman Empire signed capitulation agreements with foreigners such as the French. In capitulation merchants who were foreigners were given rights to carry out business activities in the empire but they were free from Ottoman laws and taxation. Capitulations were not a mayhem when the empire was strong. Millet systems and Capitulation became the source of political interference and foreign economic as the empire declined.
Advantages and Disadvantages
The tax farming system in Ottoman Empire was an important source of income to the empire since it made 30% of state revenues in 1528. It was seen as a revenue collection system in the economy of Ottoman Empire. Much of Ottoman Empire public revenue was coming from tax farms. An agreed amount of installments was payable to the central treasury by tax farmers failure to which the state seized the tax-farm before its term came to an end. This ensured that no one avoided to pay taxes and all taxes were paid according to the terms agreed upon. The system was not biased since the wealthy were the common subjects to execution and imprisonment. This brought about overexploitation and extortion of sources of tax by tax farmers who worked on short-term period. They strived to increase profit margins from 20% to 50% every year to the detriment of local reaya. This system was quite corrupt and persecuting for the taxpayers as opposed to timer system. Establishment of life-term tax farms led to increased amounts of revenue for state revenues. Tax farmers got wealthy since the charges and the taxes they collected were more than the amount they were supposed to pay to the central treasury.
The life-term tax farms were only affordable by a certain segment of the population which consisted of a dynasty of Ottoman members who had quite strong links to the palace, officials who held high ranks in the military, merchants and bankers who were based in Istanbul among others. This discriminated against the other part of the population who were not fortunate to have close links to the palace as well as the poorest peasants within the Ottoman Empire which resulted to a division of social classes. The system facilitated to an effective allocation of resources to the various states within the Ottoman Empire. This system enabled the private sector to get capital due to the huge profits it brought forth and by influencing entrepreneurs to venture in partnerships. The major disadvantage of this system is the extreme exploitation of the poorest peasants and this promoted continued peasantry within the Ottoman Empire. There are several reasons which are behind peasantry, they include; sub-tax farming, landlordism absence, the smooth functioning of the system being intervened by the military. The peasantry is a breach of Islamic principles.
Situation of Ottoman Empire
At the start of the 17th century ,the Ottoman Empire was the powerful state both in terms of military capability and wealth. The Sultan style of government was replaced by bureaucracy. There were power shifts in the bureaucracy due to struggles of power among the elements of the bureaucracy who consisted of the Supreme Court, the grand vizier, Janissaries and the military. The Empire declined due to the bureaucracy falling internally and the European powers’ military high efficiency.
The Sultans stopped training their sons in preparation for Sultanate by making them offer services to the military and the government. The Sultanate decline was a major factor leading to the fall of the Ottoman Empire. Power went to the Janissaries which was the military arm of the government due to the decline of Sultanate. The Janissaries gradually took over administrative positions in the government and the military. They passed these positions of power to their sons by bribing off government officials. As time passed by the Ottoman ,Empire rule was taken over by the military. Earlier under the previous Ottomans position in the government was mainly determined by merit, one had to earn government positions which were not the case when the military feudal classes took over the government, they had to bribe the government officials so as to get any administrative post in the government.
The Ottoman Empire waged several wars with the European powers in the 18th century.They fought in order to stop the expansion of Venice, Austria and Russia into the Muslim territory. In all these wars with the various countries, there were no significant losers and winners. Although the Ottoman Empire was weakened to a great extent by mid of the 18th century, its decline took a longer time than the other empires in history since it finally collapsed in the 20th century.
The system in different regions
In Egypt, the collection of tax from the whole countryside was quite organized in this system. The decision- making process on who should be the tax collector from each tax zone was based on competition auction. The validity of the term of a contract of each tax farmer lasted for only four years.
In Mughal India, it is difficult to identify when this system started but it was practiced here. The tax farmers in this system faced the same risks as the tax farmers of Egypt. The rulers of Mughal saw this system as an investment in agriculture. Abandoned villages were given out to tax farmers under the condition that the prosperity of the land would be restored. It was expected that the tax farmers who were private entrepreneurs to invest in the agricultural sector so as to gain a surplus
This system acted as a source of income or rather revenue to the government as well as a resource allocation instrument. Just like in Egypt, the Ijara system of India was not tied to agriculture only. The Kollur mines of diamond were organized into an ijara where some workers were employed by entrepreneur capitalists who leased out small plots to sub-contractors at auctions which were private. The leasing period was quite short, it sometimes ended after a few days and in worst cases it only lasted for a few hours
Conclusion
In conclusion, the tax farming system met its requirements to a great extent. Tax farming took a big part of the Muslims life of almost one thousand years of areas stretching from Atlantic to the Indian Ocean. The tax farming system was very efficient as tax collection system and as a resource allocation instrument.
Work cited
İnalcık, Halil and Donald Quataert. An Economic And Social History Of The Ottoman Empire. Cambridge: Cambridge University Press, 1997. Print.
Inalcik, Halil. The Ottoman Empire: 1300-1600. Hachette UK, 2013.
İslamoğlu-İnan, Huri. State And Peasant In The Ottoman Empire. Leiden: E.J. Brill, 1994. Print.
"Tax-Farming In The Early Ottoman State". Academia.edu. N.p., 2016. Web. 10 May 2016.
Zarinebaf, F, John Bennet, and Jack L Davis. A Historical And Economic Geography Of Ottoman Greece. [Princeton, N.J.]: American School of Classical Studies at Athens, 2005. Print
