Why did Peter the Great tie particular expenditures to particular revenue sources?
Upvote:0
Basically, it seems strange only at the first look. But this approach is rather reasonable, used by (at least) many countries in the world even today and it is unlikely that it makes a state "illegible".
I cannot provide a proof of how these matters were handled in Russia at the time of Peter right now, so let me provide some examples from today (and I am pretty sure that at Peter's time this was almost the same).
Today this approach does not mean, that money collected from a certain source of income are automatically transferred to the dedicated expenditure. The reason behind this is that when you plan your expenses you need to answer where will the money be taken from. There are numerous examples of this in today's world, here are the examples:
in Finland the government is planing to handle the refugees crisis and, as I understood, is in need to exert some state programs for this. So it has proposed to increase certain taxes. It does not mean, that when these taxes are collected the money will be directly sent to a refugee camp, it simply means that the government needs to provide some sources for any increase in expenses (Finland to raise taxes on the wealthy to cover refugee costs).
A better example. Sorry, I could not find this news in English, so please, depend on my translation. an article in Russian. It is saying in its last paragraph, that the subway in Kharkov will be being constructed at the expense of the city's football stadium sale.
Another example, sorry I could not find a link to this news, so I'll try to describe it in my own words. Recently, the Ukrainian government decided to finish the construction of 2 blocks at the Khmelnitski nuclear power plant. The money should come from electricity sales in Europe from another 2 blocks at the same plant, which are already built. Usually in Ukraine (and as I suppose other countries as well) such things are regulated by the budget law, so if the government at its own whim spends the money from those electricity sales on something else, than those 2 nuclear blocks, responsible officials can be prosecuted.
So I suppose that something like this was taking place at the time of Peter.
Upvote:4
When people owe more money than have, they have to make specific excuses from where the funds will originate for any new expenditures.
Peter drew money from poll taxes and land taxes, but those monies were heavily claimed by various creditors and entities, such as the army. Since such money comes from the people, they demand satisfaction for its use. The advantage of custom duties is that they remit to the crown alone, so Peter was free to use such money however he pleased on pet projects.
As a general rule of economics, you can only use a centralized treasury when you are in surplus. Even on the personal level this is true. If an American citizen, for example, becomes a tax delinquent and is functionally bankrupt due to an inability to pay taxes, then what happens is the government "garnishes" the tax payer's wages, collecting them directly from the tax payer's employer. So, the taxpayer no longer has a "treasury", but has specific revenue streams directed to specific debts. The same thing happens to bankrupt countries.
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