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So, after reading
Part One of our History of Customs & Tariff blog Hyperlink 1, you now know where the first tariff
“book” was found (Palmyra/ Syria AD136) and what the words customs, duty,
excise and tariff means. But what
we’re talking about here isn’t something with no current relevance; what
started centuries ago with the introduction of “customary dues” being
collected, based on a menu of costs (taxes), was the systematic taxation of
everyday people which continues today.
Customs Duties are
taxes levied upon commodities imported into or exported from a country and,
though no longer important instruments of commercial policy, transit duties
or tolls which played a role in directing trade and controlling certain trade
routes. Tolls were introduced in the Middle Ages and became very important
during the mercantilist period of 16th–18th century, lasting into the middle
of the 19th century in some countries.
Duties have always
formed one of the most important sources of the public revenue to be used at
the rulers’ or governments’ discretion.
Actually the device of raising revenue from the quantity or value of
exports and imports occurred naturally in all commercial states in need of
money, at a very early stage of its history.
And a big momentum to the growth of these taxes was the need for money
to wage war.
It was much later
that the charging of customs duty on imports developed from just being an
income generator to also being a mechanism
to trying and slow down foreign competition to protect domestic
industries. Gottfried von Haberler in
“The Theory of International Trade” (1937) suggested that the best way to
distinguish between revenue duties and protective duties (disregarding the
motives of the legislators) is to compare their effects on domestic versus
foreign producers.
Ancient Duties
The Old Greeks in
Athens imposed a duty of 2% on imports and exports over the Pierian Mountains
from which they derived a considerable revenue from their customs. They also levied an additional duty for the
use and maintenance of the harbour (harbour fees). During the Peloponnesian
war the Athenians, to replace the tribute paid by their subject states, they
introduced a duty of 5% on all commodities exported or imported by such
states. By this means they hoped to
raise more revenue than they could via direct taxation. A duty of 10% was
established for a time by Alcibiades and other Athenian generals on
merchandise passing into and from the Euxine Sea. Chrysopolis, near
Chalcedon, was fortified and a “station for the collection of the duties”
built.
The Romans also
levied customs duties, under the name of portoria, these appear to have
always existed as we have no record of their introduction and they are
referred to in Ancient writings by guys such as Livy. Portoria were levied on all goods imported
by merchants for the purpose of re-sale, including slaves (trade has always
struggled with morals), but things imported for the use of the state or for a
person’s own use were exempted from it except “luxury” goods such as eunuchs
and handsome youths. And along with the Roman duty system came the well know
business of … smuggling. At import or
export a list of purchased items had to be lodged with the official
responsible for collecting the tax, this official also had the right to
search travellers and merchants. If
goods subject to a duty were concealed they were, on being discovered confiscated.
(See nothing is new in the world of customs!)
So universal did
these duties, local and national, become, that every continental nation was
fairly covered with a network of customs lines. It is interesting to note
though that, despite all these taxes being collected, international trade not
only continued but grew. Once introduced, these duties seem to have been
accepted without riots and, as they were profitable and difficult to abolish,
many of them remain until the present time.
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Part 1:Customs duty where did it come from?
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