Principles of Hindu Taxation – Canons of Taxation
By J. N. C. Ganguly
Summary
J. N. C. Ganguli revisits the fiscal thought of ancient Indian economists by framing it around four canons of taxation similar to those later articulated by Adam Smith. Drawing on Manu, Yājñavalkya, Kauṭilya and other sources, he identifies the first canon as the subject’s duty to contribute revenue in exchange for royal protection. The second canon emphasises moderation, arguing that taxes should not exceed a sixth of a peasant’s produce and should be adjusted for calamities. The third canon stresses convenience in collection, recommending harvest‑time dues and acceptance of kind payments. The fourth canon concerns the proper appropriation of revenue for public works and charity, highlighting admonitions against extravagance. Ganguli also reviews exemptions for Brahmins and the poor, the differentiation between taxes on land, trade and profession, and the moral injunctions linking taxation with dharma.
Conclusion
Ganguli concludes that Hindu legalists envisioned a just fiscal system wherein taxation was both a civic duty and a reciprocal contract. By emphasising moderation and welfare, ancient canons anticipated modern principles of equity and economy.