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a direct relation between and tax receipts economic growth? Mathemati-
cally inclined economic historians raise grave doubts about the possibility
of proving this proposal.54
For a more nuanced view of tax trends, it is worthwhile taking a brief
look at regional revenues in the second half of the eighteenth century. Such
a perspective allows us to see that tax revenues re¬‚ected some aspects of
the varied structure of regional economies. In this regard it is necessary to
be cautious rather than deterministic. In order to grasp the difference in
dynamics of revenue collection on a regional basis, a summary review of the
regional tax evolution can prove instructive: we focus on the royal treasuries
at Guadalajara Zacatecas, M´ rida (Yucat´ n), and Veracruz between 1760 and
e a
55
1810.
In the case of Guadalajara, a predominantly agricultural and ranching
zone with a fair number of small silver mines, the latter still produced most
state income (54 percent of total) in 1760. In contrast, by 1810, mining
taxes represented only 17.6 percent of total receipts. The bulk of receipts
now came from taxes on trade, mainly alcabalas on agricultural and manu-
facturing commodities plus duties on mezcal (a popular alcoholic beverage),
together providing 46 percent of gross royal income of the regional trea-
suries.56 (See Table 2.2) The reasons for the shift from mining taxes to sales
taxes can be found in changes in the regional economy. The research of
both Eric Van Young and Antonio Ibarra demonstrates that the growth of
capital of Guadalajara and secondary cities stimulated an increase in rural


53 For tax trends, see H. Klein, Las ¬nanzas americanas, Chapter 5 and C. Marichal, La Bancarrota del
virreinato, Chapter 2.
54 The arguments of Herbert Klein may be found in The American Finances of the Spanish Empire. A very
strong logical critique is M´ nica G´ mez, “El debate sobre el ingreso ¬scal y la actividad econ´ mica.
o o o
˜
El caso de la Nueva Espana en el siglo XVIII,” in Carlos Marichal and Daniel Marino, eds., De
colonia a naci´n: la transici´n ¬scal en M´xico, 1750“1850 (Mexico: El Colegio de M´ xico, 2001),
o o e e
pp. 115“134.
55 The tax categories increased in the respective intendancies as follows: in Zacatecas from six main
branches in 1760 to ¬fteen in 1810; in Guadalajara from twelve in 1760 to twenty-¬ve in 1804; in
M´ rida from eleven in 1760 to twenty-two in 1800.
e
56 Our estimates are based on ¬scal series in J. TePaske and H. Klein, Ingresos y egresos de la Real
Hacienda. For purpose of obtaining net income, we eliminated the categories of existencias, dep´sitos,
o
otras tesorer´as, and extraordinario.
±
Table 2.2. Royal Treasury at Guadalajara: Income, 1760, 1790, 1800, and 1804

Absolute Values (Pesos) Percentages

Tax branches 1760 1790 1800 1804 1760 1790 1800 1804
Mining taxes 142,957 155,721 100,857 160,102 53.7 23.8 15.7 19.3
Sales taxes 22,630 275,583 256,399 382,034 8.5 42.2 40 46
Indian tribute 36,708 61,104 92,311 100,436 13.8 9.4 14.4 12.1
Taxes from eclesiastical resources 27,018 119,201 134,880 132,007 10.2 18.3 21 15.9
Taxes on bureaucrats 5,702 21,874 12,300 9,857 2.1 3.4 1.9 1.2
State monopolies 6,611 17,184 31,066 35,818 2.5 2.6 4.8 4.3
Other ¬scal sectors 24,686 2,466 13,523 10,301 9.3 0.4 2.1 1.2
total income 266,312 653,133 641,336 830,555 100 100 100 100
n
Source: J. J. TePaske and H. Klein, Ingresos y egresos de la Real Hacienda de Nueva Espa˜ a, (Mexico, Instituto Nacional de
Antropolog´a e Historia, Colecci´ n Fuentes, 1986“88), vol. 1, “Sumario general de carta cuenta de Guadalajara.”
± o
Imperial Tax State 69

production while mining stagnated.57 As a result, the expansion of rural
and urban markets offered excellent opportunities for increased taxation.
In contrast, in a mining region such as Zacatecas, the relative changes
in tax revenues were almost imperceptible during the second half of the
eighteenth century. In 1760, of nineteen tax categories, those on silver
mining produced 83 percent of the total; half a century later, in 1810, there
were thirty ¬scal branches but mining still contributed 75 percent of gross
income. (See Table 2.3) The continuity in the tax base was also visible in
the tax records of the royal treasury of M´ rida, Yucat´ n, where the largest
e a
source was taxes on Indian peasant communities. In 1760, Indian tribute
produced 43 percent of total receipts while in 1808, the local treasury
continued to rely mainly on this source, receiving 35 percent of its income
from contributions of the peasant communities.58 (See Table 2.4.)
A quite different ¬scal structure can be observed in the case of Veracruz,
a region that had the largest port in the viceroyalty and much comercial
agriculture. In 1760, net tax income was 265,000 pesos but by 1810, the
total had climbed quite spectacularly to 1.5 millon pesos: much of this was
derived from expansion of external trade. Duties on imported goods, known
as alcabalas del mar, provided 32 percent of total revenues, while harbour
duties on ships known as almojarifazgos supplied 36 percent of total ¬scal
receipts.59 (See Table 2.5.) These ¬gures indicate that the liberalization of
commerce impelled by the Bourbon reforms successfully stimulated the
expansion of both internal and external trade and thereby provided new
sources of tax revenue.
The analysis of regional ¬scal trends suggests that royal administrators
were well aware of both continuity and change in local economies. When
the traditional bases of a regional economy did not change, the old, direct
taxes remained the source of most revenues, as can be seen in the case of
silver mining in Zacatecas and peasant agriculture in Yucat´ n. On the other
a
hand, in regions that experienced more rapid economic transformations
such as Guadalajara or Veracruz, tax dynamics shifted quickly and indirect
taxes came to the fore. In a word, the ¬scal of¬cers managed to capture
the essential trends of economic expansion without trying to measure or

57 Eric Van Young, Hacienda and Market in Eighteenth Century Mexico: The Rural Economy of the Guadalajara
Region, 1675“1820 (Berkeley: University of California Press, 1981) and Antonio Ibarra, “Mercado
urbano y mercado regional en la Guadalajara colonial, 1790“1811,” Ph.D. thesis, El Colegio de
M´ xico, 1995.
e
58 If we deduce income obtained in Yucat´ n through the war donation of 1808, the proportion of the
a
Indian tribute in Merida remains the same as in 1760. For details, see D. Tanck de Estrada, “Protesta
ind´gena al rey.”
±
59 Our estimates are based on ¬scal series in J. TePaske and H. Klein, Ingresos y egresos de la Real Hacienda.
We do not include in local Veracruz income the transfers from other treasuries such as that of Mexico
which were to be remitted abroad.
Table 2.3. Royal Treasury at Zacatecas: Income, 1760, 1790, 1800, and 1810

Absolute Values (Pesos) Percentages

Tax branches 1760 1790 1800 1810 1760 1790 1800 1810
Mining taxes 197,738 340,443 329,930 478,555 82.9 77.9 64.1 75.4
Sales taxes 26,237 41,833 107,134 74,357 11 9.6 20.8 11.7
Indian tribute 7,509 7,754 12,745 24,061 3.15 1.8 2.5 3.8
Taxes from ecclesiastical sources 5,639 5,526 13,541 19,448 2.4 1.3 2.6 3.0
Taxes on bureaucrats 717 1973 2,976 1,030 0.3 0.45 0.6 0.2
State monopolies 793 39,404 45,113 33,698 0.3 9.0 8.8 5.3
Other ¬scal sectors 99 3,141 3,626 0.02 0.61 0.57
total income 238,633 437,032 514,580 634,775 100 100 100 100
n
Source: J. J. TePaske and H. Klein, Ingresos y egresos de la Real Hacienda de Nueva Espa˜ a, Mexico, Instituto Nacional de Antropolog´a
±
e Historia, Colecci´ n Fuentes, 1986“88, vol. 2, “Sumario general de carta cuenta de Zacatecas.”
o
Table 2.4. Royal Treasury at Merida: Income, 1760, 1790, 1800, and 1808

Absolute Values (Pesos) Percentages

Tax branches 1760 1790 1800 1808 1760 1790 1800 1808
Mining taxes 5,974 8,533 25,002 43,336 4.18 7.80 11.36 14.85
Indian tributes 61,390 65,739 83,102 101,561 42.99 60.07 37.76 34.80
Taxes from ecclesiastic sources 6,172 13,507 27,489 30,209 4.32 12.34 12.49 10.35
Taxes on bureaucrats 15,013 3,923 197 9,802 10.51 3.58 0.09 3.36
State monopolies 2,487 14,234 15,405 29,251 1.74 13.01 7.00 10.02
Other ¬scal sectors 51,754 3,509 68,856 77,644 36.24 3.21 31.29 26.61
total income 142,790 109,445 220,051 291,803 100 100 100 100
n
Source: J. J. TePaske and H. Klein, Ingresos y egresos de la Real Hacienda de Nueva Espa˜ a, Mexico, Instituto Nacional de Antropolog´a
±
e Historia, Colecci´ n Fuentes, 1986“88, vol. 1, “Sumario general de carta cuenta de M´ rida.”
o e
Table 2.5. Royal Treasury at Veracruz: Income, 1760, 1790, 1800, and 1805

Absolute Values (Pesos) Percentages

Tax branches 1760 1790 1800 1805 1760 1790 1800 1805
Mining taxes 4,210 6,532 0.21 0.98
Sales taxes 232,191 1,569,521 490,296 1,389,587 87.50 80.13 73.30 90.94
Indian tribute 8,610 43,647 60,219 50,096 3.24 2.23 9.00 3.28
Taxes from ecclesiastical sources 125,000 705 4,095 6.38 0.11 0.27
Taxes on bureaucrats 2,363 35,966 3,971 11,243 0.89 1.84 0.59 0.74
State monopolies 2,802 87,238 37,044 19,926 1.06 4.45 5.54 1.30
Other ¬scal sectors 19,402 93,132 70,128 53,119 7.31 4.75 10.48 3.47
total income 265,368 1,958,714 668,895 1,528,066 100 100 100 100
n
Source: J. J. TePaske and H. Klein, Ingresos y egresos de la Real Hacienda de Nueva Espa˜ a, Mexico, Instituto Nacional de Antropolog´a
±
e Historia, Colecci´ n Fuentes, 1986“88, vol. 2, “Sumario general de carta cuenta de Veracruz.”
o
Imperial Tax State 73

assess it directly “ a near impossibility at that time. An additional aspect
that underlines the ¬scal sharpness of the royal of¬cials was their emphasis
on taxing tobacco and alcohol: this was indicative of an awareness of the
positive returns to be obtained from taxing goods for which demand was
relatively inelastic, but not compulsory.60 In any case, the high growth rates
of tax revenues throughout the viceroyalty were most visible in the period
1760“1785, being followed later by a slower expansion in the two following
decades.


The Fiscal Burden of Colonialism for the Inhabitants of New Spain
Beyond measuring revenue trends over time, it is also important to raise
the issue of impact and incidence of taxes, although this is a subject that
awaits much future research. In recent years, a few studies have begun to
probe into some aspects of the social consequences of tax policies in colonial
Mexico, analyzing tax shifting and incidence and also the economic effects of
the Bourbon monarchy™s ef¬cient but heavy tax machinery.61 Such analysis
can prove of interest for an evaluation of the costs of colonialism for speci¬c
social groups, but also sheds light on future debates on what may be termed
the ¬scal constitution of the colonial regime in Spanish America.62
In the case of Indian tribute, for example, the burden for Indian peasant
families in Mexico was signi¬cant since it represented two and a half pesos on
a small income (which would be, at best, some twenty to twenty-¬ve pesos a
year for a nuclear family).63 It was also hard on those Indian peasant families
which produced little in the way of agricultural or ranching commodities
that could be exchanged for money, and particularly hard on those who
had no land or were in dire poverty, of which there were many. On the
other hand, it is also true that Indian peasant communities were largely
exempt from other taxes such as the alcabalas on the maize and beans that

60 I am grateful to Richard Salvucci for this and several other observations on the implicit logic of the
Spanish ¬scal system at this time.
61 See C. Marichal, La bancarrota del virreinato, Chapter 2 and C. Marichal and D. Marino, eds., De colonia
a naci´n, Chapters 1“3.
o
62 On the concept of a ¬scal constitution in eighteenth century Britain, see R. Bonney, “Revenues”
(Chapter 13), in R. Bonney, ed., Economic Systems, pp. 431“438 and P. O™Brien, Fiscal Exceptionalism:
Great Britain and Its European Rivals from Civil War to Triumph at Trafalgar and Waterloo, pp. 13“14
and 19“20.
63 The estimate of 25 pesos would be wage earnings of an Indian who had regular work on a ranching or
agricultural “hacienda.” For estimates of rural wages and income, see R. Garner and S. E. Stefanou,
Economic Growth and Change in Bourbon Mexico, pp. 81“84. However, many Indian peasants simply
lived off a small piece of their own land, and their income was largely nonmonetary, consisting
basically of subsistence food products, mostly maize and beans.
74 Bankruptcy of Empire

they produced mostly for sustenance but a small percentage of which they
regular marketed.64
A very different case was that of taxes on silver mining, a tremendously
important economic sector. This direct tax of 10 percent on the production
of all silver fell directly on the mine owners. It does not appear that there
could be much shifting forward of this tax, although some shifting backward
was possible insofar as miners might pay less for certain inputs of essential
supplies, but this subject has not been studied in depth. In any case, the
complaints of miners with respect to rising costs were suf¬ciently strong
from the late 1770s as to force the Crown to reduce various taxes related to
mining, including mercury prices (a state monopoly) and alcabalas on key
supplies for the mining sector such as mules and horses, leather, salt, and
powder.
The alcabalas, which were the most important of indirect taxes, affected
all consumers, rich and poor.65 The sales taxes fell clearly on the ¬nal
consumer who bought food or textiles. However, it is hard to evaluate exact
incidence because it is necessary to study different types of commodities as
well as taxpayers. Since the alcabalas were charged on the basic staple goods
acquired by a majority of the population (food, textiles, alcohol), it was a
clearly regressive tax, although the wealthier sectors paid more alcabalas per
capita because of greater consumption. It may be calculated that average
urban Mexican working families paid in indirect taxes somewhere between
8 and 15 percent of their income, whereas propertied groups generally
contributed a marginal percentage of their income on this account.66
An important question remains unanswered, namely, was there a clear
perception that the taxation had become a greater economic burden than
in the past? The impression gained from a review of studies by Klein
and Garner is that the multiplication of new taxes and the more rigorous
collection resulted in a greater tax burden in colonial Mexico from the time
of the reforms of G´ lvez. However, this impression must be treated with
a
caution, for there are indications that from 1785 several important sources of

64 Juan Carlos Garavaglia and Juan Carlos Grosso, “Estado borb´ nico y presi´ n ¬scal en la Nueva
o o
˜
Espana, 1750“1821,” in Antonio Anino, coord., Am´rica Latina: del Estado colonial al Estado naci´n,
e o
vol. 1 (Turin, Italy: Franco Angeli Libri, 1995) pp. 92“93.
65 An excellent case study which analyzes local sales taxes is Juan Carlos Garavaglia and Juan Carlos
Grosso, Puebla desde una perspectiva microhist´rica. La villa de Tepeaca y su entorno agrario: poblaci´n,
o o
producci´n e intercambio (1740“1870) (Mexico: Claves Latinoamericanas, 1994).
o
66 While much additional research is needed on consumer trends in eighteenth-century Mexico, Van
Young has opened the ¬eld. He offers various estimates on income by different social groups and
argues that circa 1800, poor Mexicans spent close to 63% of their total income on corn (basically for
tortillas), a substantially higher percentage than European working poor spent on bread, their staple
of life. See the essay by Eric Van Young, Los ricos se vuelven m´ s ricos y los pobres m´ s pobres in the
a a
book by the same author, La crisis del orden colonial: Estructures agraria y rebeliones populares de la Nueva
Espa˜ a, 1750“1821 (Mexico: Alianza Mexicana, 1992), pp. 51“123.
n
Imperial Tax State 75

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