The king used to derive his revenue from contributions of his subjects known as Bali, at first voluntary but afterwards developed into a compulsory payment. Another source of revenue of a king was “tribute” from the conquered communities.
When the king’s revenue came to be derived from the agricultural produce, the specific rate was one-sixteenth and a contribution in cattle from the villages. Revenue administration developed with development of theory of taxation.
“The origin of land system is as old as the origin of state in ancient India. One of the fundamental conceptions is that taxes are king’s dues for the service of protection”.
The general features of the revenue system, as envisaged by Kautilya and the sources of finance were as many as could be devised by human ingenuity. From cooked rice to dried fish, all things taken into city were taxed and stamped at city gates.
The Arthasastra differentiates between forms of revenue not According to their incidence but according to their source. Revenue is either derived from the land (Aparthiva) or derived from the sources other than land (Aparthiva). The government was to tax the people even to maintain their religion and this appears to be an innovation of Kautilya.
The rate of the tax on land varied from one twelfth to one-third in times of emergency. The amount of land tax might range from one twelfth to the sixths of the produce by the nature of the soil and the labour necessary to cultivate it.
Department of Revenue was one of the most important departments. Kautilya had elaborated the administration of revenues because he knew that “finance was the basis of all activities” of a state. Kautilya, for that very reason, had prescribed so many sources of revenues and arranged for their proper utilization.
The machinery of Revenue Administration of Kautilya could be easily traced to the Vedic Samhitas and the Brahmanas.
The Panchavimsa Brahamana mentions Samgrahitt and Bhagadugha. Sayana explains Bhagadugha in the sense of one who collects the king’s share from the people and makes it over to the king.
Kautilya believed that State Revenues depended upon the production of wealth. Kautilya mentions two high officials Samaharta and Sannidhats who are practically vested with the immediate control of the whole of financial administration.
In his financial capacity, the Samaharta’s functions practically extended over the whole range of state income and expenditure. The task of collecting, revenues was entrusted to Samaharta and his officials. The Samaharta was assisted by the Sthanikas and under them were Gopas, each of whom was in charge of five or ‘ten villages’.
The Samaharta should prepare a great revenue roll of the kingdom and under his direction Gopa is to prepare various registers and census list of village in local areas, the Gopas were the, agents of local government. They made collections and maintained registers of income and expenditure.
A Sthanika was to superintendent a fourth part of the kingdom in the same manner as the Gopa. Sannidhata may be termed as Minister of stores and revenue while Samaharta was Minister-in-charge of collection.