King-Chapter 1431 - 4: The Disaster Strikes

The land reclamation efforts unfolded in an orderly manner, pushing the wave of reform in the Kingdom to its peak. Public opinion was boiling, and all departments of the government introduced reform measures.

Accompanying this is pressure!

Among the ministers responsible for reform, except for Hudson, who continues to eat and drink as usual, the others are almost worried to the point of turning gray.

Even when it comes to rectifying the bureaucracy, they have encountered unprecedented resistance. Local Noble Lords are uncooperative, confining the reforms to the Royal City.

Despite encountering so many difficulties, the Alpha Kingdom is still the envy of many other reforming nations.

No matter how big the challenges, the pace of reform continues to move forward. Unlike those troubled ones, where before the reform there were supporters, and once it started, opponents were everywhere.

After sending off the foreign Ambassadors who came to learn from their experience, Caesar IV could only smile wryly. The issues at home are troublesome enough, who would have thought there were so many others in worse situations.

As the Kingdom’s reforms progress to this point, let alone securing full support from local influential groups, opposition has even emerged within the Royal Family.

The Nobles supporting the reforms are essentially concentrated in the newly added provinces of the impoverished Kingdom, purely being generous at others’ expense.

The only comforting aspect is that amidst a chorus of objections, the grand reform continues to advance slowly.

"Your Majesty, the situation is somewhat grim!

In the trial area, the tax collection for this quarter has fallen far short of expectations. The taxes collected are not even two-thirds of the previous amounts.

The Noble Lords who were transferred the tax collection rights appear cooperative on the surface, but all their external transactions are labeled as gifts, leading to a massive loss of taxes."

Count Francis said with a frustrated face.

The worst-case scenario has finally emerged. No wonder everyone was so cooperative before; it turns out it was premeditated.

The Alpha Kingdom has a pitifully small number of freemen; the main participants in market transactions are the local Noble Lords. Once these people found a way to evade taxes, naturally, taxes couldn’t be collected.

The Kingdom Government can’t say much, as they are following the rules, and no one can prohibit social exchanges!

All bulk commodities transactions are tax-exempt, and the taxes from small-scale transactions are a pittance!

At this moment, everyone realized that the ancient system of tax farming not only maintained Noble interests but also safeguarded the interests of the Kingdom Government.

No matter how outdated the tax farming system is, it could still gather taxes, while the Kingdom Government couldn’t even collect the most basic taxes when stepping in directly.

Of course, it’s not without benefits. After the Kingdom Government unified tax collection, numerous transit taxes disappeared, greatly promoting the development of the Kingdom’s industry and commerce.

Industrial and commercial development still brought new increments to the Kingdom Government, but these industry increments are long-term and impossible to translate into immediate fiscal relief. freewёbnoνel.com

Theoretically, as long as we persist, once domestic industries develop, making the pie bigger could also compensate for tax loopholes.

After all, what’s currently being underpaid is only the bulk commodity transaction tax; other taxes have been retained.

The current significant impact is mainly due to the overly homogeneous nature of bulk commodities transactions, there’s only a handful of them.

The merchants engaged in these trades are also fronts put up by the Nobles to achieve quick connections in a short amount of time.

When the commercial economy develops, the proportion of transactions in grain and other bulk commodities will decrease, and the impact will not be significant.

The problem is the Kingdom Government doesn’t have that much time!

Currently, the trial is only being conducted around the Capital, and taxes have already decreased by a third. What would happen if it was expanded nationwide?

Keep in mind, the tax revenue from economic development in the Capital is the highest in the entire Kingdom, and the variety of taxes is also the most comprehensive.

In some remote areas, aside from grain transaction tax and salt trading tax, other taxes are negligible.

Due to the excessively backward economy and limited local purchasing power, even products like Magic Potions, Magic Crystal Stones, Magic Equipment... don’t have a market.

"Do you have any countermeasures for the current situation?"

Caesar IV asked with concern.

Frankly speaking, this trial was a tragedy. From the selection of the area, he hasn’t had a moment’s peace. Every day, numerous Nobles come to voice their grievances, forcing Caesar IV to shut his doors to visitors.

Pushing ahead with reforms under pressure, they encountered a big problem right at the start.

The Kingdom Government initiated reforms to increase fiscal revenue, but the drastic tax reduction clearly goes against that, even if it is only a short-term decline.

"Your Majesty, such growing pains are unavoidable!

In a market among acquaintances, there are numerous ways to evade taxes. Using the pretext of mutual gift-giving is just one of them.

If needed, they can set a public transaction price and a private one.

Theoretically, selling a hundred tons of grain for a copper coin is their freedom.

Even if the tax collection model is changed to physical collection, they could come up with better tax evasion methods.

Referencing the Frank Empire and the Iberia Kingdom, after completing their tax system reforms, their taxable entities changed to freemen instead of Noble Lords.

The proportion of freemen in the Kingdom is too low, hence the wealth they could create is limited, and the collectible taxes are even less!"

Prime Minister Duke Delgado answered solemnly.

While studying the economies of the countries on the South Continent, he inadvertently discovered that the economically developed nations on the South Continent are all, without exception, countries with a high proportion of freemen.

On average, the wealth created by a freeman is two to three times that of a serf, with tax contributions even as high as six to eight times.

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