Part 1

History of Taxation in Rhode Island to the year 1790.

By Henry B. Gardner.

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Contents.

Introduction Page 1 Taxation in Rhode Island 1636-1689 4 The law and administration 16 Taxation 1689-1710 25 The law and administration 32 Miscellaneous revenues 37 Period of paper money 1710-1751 38 Financial history 1751-1790 46 The law of taxation since 1710 63 Colonial and state valuations 69 Customs and excise duties 82 Tonnage duties 89 Notes 91

Introduction.

That method of raising revenue for the support of government which we understand by taxation marks a well advanced stage of economic life and is of comparatively recent origin among Germanic peoples. It was unknown while our English ancestors lived upon the continent of Europe and for many centuries after they had settled in their new home Society, and, as a consequence, government had not as yet become differentiated. Some of the most important duties, such as the defence of the kingdom, the care of the bridges and forts, were performed by personal service on the part of the people. Other duties incumbent upon the modern state, those which require the greatest expenditure, had not arisen. The private and public revenues of king were not as yet distinguished. The revenue of his private estates afforded him a considerable income and, in addition, he enjoyed the usufruct of the folkland. The growth of the feudal system gave rise to various other sources of income, and besides these there were payments for special privileges such as markets. The king also enjoyed rights such as that of carriage and purveyance, for example.

Taxation as we conceive it formed no part of the system. "Only in a condition of the deepest degradation, under Athelstan the Unready, could the national assembly be induced to levy a tribute upon the country to buy off the horde of Danish pirates." Taxation developed rapidly after the Norman conquest, but as late as the reign of James I out of a total revenue of about £450,000, £180,000 came from dues on feudal tenures, and the crown lands, rented at much below their real value, yielded £32,000.

Feudal dues remained an important source of revenue until the time of Charles II. All through the early period "the taxes voted were 'aids' and 'subsidies'; something to help the king eke out his income, as it were. Systematic taxation as a right--nay, as a duty owed by the citizen to the State--was an idea entertained with the utmost reluctance." Even after national taxation had become established the local bodies continued to depend on personal service (or payments in kind) to fulfil their military, police, or judicial functions. It was the apportionment among individuals of fines incurred by the various local divisions for the neglect of these duties which first gave rise to the county rate, the hundred rate, and the tithing rate or town levy. From the Tudor legislation of the Sixteenth and early Seventeenth centuries local taxation received a definite form and character. The poor law of 43 Elizabeth which established the parish poor rate became the basis of the system. To this rate all others tended to conform. In early New England the conditions were much the same in regard to taxation as in early England. The functions of government were few and simple and often easiest fulfilled by personal service on the part of the citizens. This was the case with respect to the maintenance of the roads, and with military service. The army was the folk under arms. The duties of public officers, whether of town or colony, could not have been burdensome and in many cases acceptance of office was looked upon as a duty to be performed without, or with small, recompense, refusal being accompanied by a fine. A considerable portion of public services such as those of the executive officers of the courts (and even of the judicial officers) were naturally recompensed by fees. Pauperism the great burden of the older country was hardly possible where land was abundant and labor scarce.

What has been said or New England in general applies with added force to Rhode Island, for here the political body concerned itself as a rule with neither religion nor education. Taxation was regarded for a long time not as the principal means for meeting ordinary expenditures but as something irregular and supplementary.

Taxation in Rhode Island, 1636-1689.

The towns before the Union.

Unlike Massachusetts the towns in Rhode Island remained the supreme authority under the king for some years before any central government was established by charter. The first delegated government established in Providence was in 1640. It was of the simplest nature. Five men were to be elected quarterly, who, subject to the control of the town meeting, were to have the disposal of lands and of the "townes stocke." Disputes between citizens were to be settled by arbitrators appointed either by the parties to the dispute, or by the five "disposers," payment for their time spent to be made by the "faultive" party.

Provision was also made for a clerk who was to receive 4d. for each cause that came to the town for trial and 12d. for each deed prepared. All the inhabitants were to join in the pursuit of a fugitive from justice.

The "townes stocke" was probably derived from fines and payments for land by the new comers, as there is no mention of taxation. At the time of the union of the towns in 1647 the delegates from Providence to the general court, which was to organize the colonial government, were instructed to secure to the town the reservation of certain rights in the management of their own affairs, but neither in these instructions nor in the charter of very full powers afterwards granted to the town is there any direct reference to taxation. In Portsmouth and Newport the delegated power was in the hands of a judge and elders. These towns probably depended on much the same sources of revenue as did Providence; fines, fees, and payments for land. The political development however was more rapid on the island than on the mainland and we early find in Portsmouth traces of taxation as well as of comparative advancement in financial affairs. The records of the first year of the Newport settlement show that their financial transactions were of importance and that certain officers, such as the secretary and sergeant, received considerable payments from the town. There is no record of the amount charged for land, nor any mention of taxes, though it is not improbable that they existed in some form, as the settlers in their first compact engage "to bear equal charges answerable to our strength and estates in common." In 1640 Newport and Portsmouth came together under a common government, each town retaining however its own organization, and the control of its own affairs. The general officers were a governor, a deputy governor, four assistants, two treasurers, two constables, a secretary, and a sergeant. The magistrates (governor, deputy governor, and assistants) fulfilled judicial as well as executive functions. The only reference to the payment of officers is a provision in 1641 that the secretary should have 3s. per day for his attendance upon the various courts. In the following year this salary is taken away and it is ordered that both the secretary and the sergeant be paid by fees.

The common expenses were met by drafts on the town treasurers. The financial transactions of the united towns were considerable in amount, and there are several special taxes of interest. It was ordered in 1640 that the treasury of each town be always supplied with two barrels of gunpowder and with bullets and match. Every man who killed a deer outside of his own property was required to bring in one half to the treasury under penalty of forty shillings. Thus the town derived a revenue from the use of the public domains. In 1642 a bounty of five pounds was offered on wolves, to pay which it was provided that a rate should be levied on every man according to his cattle; the idea of a direct relation between the tax and the service rendered. Bounties of this kind must have been one of the principal sources of expense to the early settlers. On wolves they were sometimes as high as £5, at other times not more than 30s., while the rate on foxes was 6s. 8d.

The above seems to be substantially all that remains of the financial records of the early towns. We find in them the conditions already noted; few needs, abundance of land, for sharing which they could demand a payment of all new comers, payment by fees or, if a tax was necessary, perhaps by a tax on a particular class, as in the case of the bounty on wolves. Fines, too, probably formed a not inconsiderable source of revenue, for the home of religious freedom seems to have been to some extent the home of those who desired freedom from the law as well. When a general tax for the common good was levied the "estate and strength" of each must have been a matter of common knowledge impossible of concealment. It should be noted also that neither at this time nor much later under the charter government was the business of the treasury managed with that exactness which we find today. Receipts were very often far behind expenses and bills were frequently allowed to remain unpaid until the money happened to be in the treasury.

The four towns first organized under a common government in 1647 by virtue of what is known as the Patent, procured through the efforts of Roger Williams in March 1643-4. Under this government the colony remained, with the exception of an interruption lasting from the spring of 1651 to August 1654, until it reorganized under the charter of 1663 which remained the fundamental law of the colony and state for one hundred and eighty years.

The general officers under the Patent were a president and four assistants, a general recorder, a treasurer, and a general sergeant. There was also a committee composed of six representatives from each town. A general attorney and a solicitor were added in 1650. Under the charter of 1663 the president was replaced by a governor and deputy governor, the number of assistants was increased to ten, and, instead of the committee of six from each town, provision was made for six deputies from Newport, four each from Providence, Portsmouth, and Warwick, and two each from all other towns that might come into existence. The other general officers remained the same as before. Under both governments the magistrates (president, or governor and deputy governor, and assistants) performed judicial functions.

Public service was considered as a duty the fulfilment of which was enforced by law while payment, except where the method of fees was available, was either not given at all or was but daily wages for the time actually employed in the service. Payment for service in the general assembly or the court of trials did not exceed three shillings a day, with a much heavier fine for non-attendance. In addition to this a law of 1679 provided that diet and lodging should be furnished those in attendance, the expense to be met out of the fines and forfeitures coming into the general treasury.

The services of the recorder, sergeant, and general attorney were compensated by fees, though the first two seem also to have had daily wages for their time employed, and their payment was among the chief sources of expense at this early period. The general treasurer enjoyed a percentage, sometimes as high as ten per cent, on the amount of his transactions.

The care of the highways and the poor was given over to the towns. It is evident that the expenses of such a government could not have been great.

So small were the financial operations during the earlier years that the general treasurer "returned his accompte into the courte for the year 1649, that he (had) received nothing as Treasurer and therefore have nothing in his hande," and Gregory Dexter, town clerk of Providence, could write to Sir Henry Vane "Sir we have not known what an excise means. We have almost forgotten what tythes are; yea, or taxes, either to church or commonweale.". In fact for many years fines and forfeitures seem to have been the chief reliance for defraying ordinary general expenses and they continued to form a principal element of the receipts until the end of the century.. Taxation however could not be entirely avoided. It was necessary to place the colony in a position capable of defence and in 1650 each town was ordered to have in its magazine a certain quantity of arms and ammunition, the amount assigned to each town to be equally laid upon the inhabitants of the council thereof "according to each man's strength and estate." Taxes were also levied to pay for powder and shot sent, over from England. Prisons were necessary and in 1655 the towns were ordered to build two prisons, two cages, and two pairs of stocks, one of each on the mainland and one on the island at a total cost of £135. Later court houses and a state house were required, but on the whole taxation to meet ordinary expenses remained almost ludicrously small until long after Rhode Island had become a state. The exercise of the taxing power was reserved for special occasions. The most important of these was war; next came the support of an agent in England. Wars which required the employment of a paid soldiery did not begin until the end of the Seventeenth century; agents in England to look after colonial interests were a necessity from the very beginning of the colonies and lasted until the colonies became states. Particularly was this the case in Rhode Island, small in population and territory, its jurisdiction attacked on every side by the claims of more powerful neighbors, with a charter containing grants of such unusual freedom that it was a constant target for those opposed to colonial self-government. One of the acts of the first general assembly under the Patent in 1647 was to assess upon the towns a tax of £100 to pay Roger Williams for his exertions in procuring that document more than three years before. Williams in company with John Clarke again went to England to secure the repeal of Coddington's commission. The former returned on the accomplishment of his mission but Clarke remained and cared for the interests of the colony, and it was in connection with his efforts to secure the charter of 1663 that taxation on any considerable scale began. The following table will show the taxes levied from 1662 to the fall of the Andros government in the spring of 1689. Those taxes marked with a star were levied under the Andros régime.

Date of Amount. Purpose. Payment may be Ass'm'nt. made in.

June 1662 £288 "in silver Agent. "beefe, porke pay" pease, and wheat, at such prices as it then goeth to the merchants as moneye pay;"

Oct. 1662 £106 Agent. "goods" to be priced by men chosen for the purpose.

Oct. 1663. £100 "in current Agent bills."

Oct. 1664. £600 Agent and others wheat, peas, to whom the pork, horses, colony is cattle, or any indebted; sort of provisions "according to the usual rate that it doth pass at amongst us".