Of Taxes: An enquiry into Dutch to British Malacca, 1824-1839 Presenter: Dr Diane Kraal BLT Department Seminar, Monash Staff Club, 22 June 2012

Of Taxes: An enquiry into Dutch to British Malacca, 1824-1839

Presenter: Dr Diane Kraal

BLT Department Seminar, Monash Staff Club , 22 June 2012

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Presentation Outline

• Aim of research • Motivation• Background• Research questions• Methodology & methods• Findings• Contribution of research

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Aim of research

• The research aim is to investigate 19th century

British Malacca’s taxation.

• Period: 1824-39, transition from Dutch to British rule

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Motivation

we know that there was a change in colonial powers…

…but what influences made the British tax system

different to the preceding Dutch system…

• To gain a clearer understanding of the reasons for the changed system of tax in 19thC British Malacca.

Background to study

Naning War 1831-32 obelisk, Dutch Graveyard, Melaka

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Background to study

Pre- 1511 Johor Malays

Malacca: a trading port – Johor Malays sovereign

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Portuguese Malacca 1511-Pre-1511 Johor Malays

Dutch VOC Malacca 1641

British ‘caretaker’ 1795-1817

Return of the Dutch 1818-1824 British Malacca 1824-

1957

Background to study Malacca: conquest by Portuguese

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Malacca: conquest by Dutch East India Company (VOC) with Johor Malays

Portuguese Malacca 1511- 1641Pre-1511 Johor Malays

Dutch VOC Malacca 1641-



1957

Background to study

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Malacca: taken by British East India Company into ‘caretaker mode’


Dutch VOC Malacca 1641-1795

British ‘caretaker’ 1795-


1957

Background to study

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Malacca: post-Napoleonic wars; the Dutch return




Return of the Dutch 1818-British Malacca 1824-

1957

Background to study

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Malacca: ceded to British by Dutch





1957

Background to study

Thomas Braddell, Attorney-General of the Straits Settlements (1867-82) retrospectively wrote:

After the British took formal control of Malacca in 1824 ‘arrangements were at once made to conduct the government on improved principles.’

Major Research Question:

•How correct was Braddell’s claim about the British approach based on ‘improved principles’ – in relation to tax - for the period 1824-1839?

•If Braddell’s claim is correct, can it be demonstrated?

Research design

EpistemologyPositivist Non-positivist

‘Quantitative’ Qualitative

Theoretical perspectives: Pol. Eco. theory: Adam Smith (1723-1790) Pol. Eco. theory: James Mill (1773-1836)

Methods

Discussion/conclusions

Tax revenue data: Historical method •Statistical•Graphical analysis

Methodology

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Data Primary data:• British Residents’ Malacca Diaries: 1826-1830• Account journals and Ledger, Malacca: 1826-1830• Dutch Records of Malacca: 1819-• Dutch East India Company (VOC) files to 1795

Main secondary sources:•Kathryn Sutherland, ed. Adam Smith: An Inquiry into the Nature and Causes of the Wealth of Nations (2008)•James Mill, Elements of Political Economy, 3rd ed. (1844),•Eric Stokes, The English Utilitarians and India (1959)•Paul H. Kratoska, "Land Law and Land Tenure in British Melaka," in Melaka: The Transformation of a Malay Capital C. 1400-1980, ed. Kernial Singh Sandhu and Paul Wheatly (1983)

Dutch VOC 1641-1795, Dutch Govt. 1818-1824 Two main streams of revenue: trade & tax

- Tax farming: indirect taxation method, eg. customs duties, opium

British East India Company (EIC) 1824…Two main streams of revenue: trade & tax

- Tax farming: eg. spirits; no customs- Land rent - Direct tax assessment eg. commercial bldgs.

Quantitative data

Dutch VOC 1641-1795

Quantitative data

Customs Farm , 60.2

Sea and river fish, 7.4

Head tax on the Chinese, 5.0

Weigh-house, 4.2

Opium/distilling arak, 6.7

Shopholders, 3.4

Sirih or betel leaves, 3.0

Chinese gambling, 2.2 Other, 7.8

Graph 2. VOC Malacca: 1681-1796Tax Farms: average percent share of revenue

Source: Reid(1993); Hussin (2002); VOC Archives.

Dutch/British - customs revenue 1796-1824

Quantitative data

Source: Braddell (1861) p.24; Hussein (2002) pp.423-425.

British Dutch BritishDutch

Adam Smith (1723-1790) “Wealth of Nations” 1776

•Two systems of political economy: 1. Agriculture2. Commerce:

a. mercantile monopolyb. free-market

• ‘Of Taxes’: tax maxims- equity, certainty, convenience, efficiency

•Land Rent



- mercantile monopoly- free-market


•Land Rent



- mercantile monopoly- free-market


•Land Rent

James Mill (1773-1836)EIC employee/ “Elements of Political Economy” 1821

• Mill influenced the land rent system in Malacca

• Was an ‘acolyte’ of Adam Smith

• Mill used David Ricardo’s land ‘rent doctrine’

• Rent doctrine – too extreme –dropped by EIC in 1836

James Mill (1773-1836)EIC employee/ “Elements of Political Economy” 1821

• Mill influenced the land rent system in Malacca

• Was an ‘acolyte’ of Adam Smith

• Mill used David Ricardo’s land ‘rent doctrine’

• Rent doctrine – too extreme –dropped by 1836

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Analysis of Findings

Progressiveness in Malacca?

– Customs duties

– Land rent

– Tax Farms and direct tax assessment

Influences: Adam Smith? James Mill?

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Conclusion

• There was a concerted attempt to conduct government on ‘improved principles’ in relation to tax, but with mixed results.

• The Malacca case study, 1824-1839, has shown the difficulty of putting Enlightenment theory into practice.

Contribution of Research

1. To understanding Adam Smith’s and James Mill’s influence on tax policy changes during the changeover in colonial governing powers.

2. Extends knowledge in the field of tax history concerning the development of colonial tax to modern taxation practice.

3. Adds to the literature concerning colonial Southeast Asia taxation, for the study elicits liberal thought from British Residents’ Malacca Diaries.

Documents

Of Taxes: An enquiry into Dutch to British Malacca, 1824-1839 Presenter: Dr Diane Kraal BLT Department Seminar, Monash Staff Club, 22 June 2012