Most tax reforms have been spasmodic and have come as the result of necessity rather than of deliberation. Often changes have been made to lighten the burden on particular classes of persons who, for the time being, held the balance of power. It is often necessary to secure revenue, and the most expedient plan has been the one most generally used, with little thought as to the justice of the scheme itself, or its relation to other methods of raising revenue which may be in use. This characterization is true, to some degree, of every country, but is less applicable to Prussia than to any other. This is because a number of students, from an early period, made careful investigations and calculations as to what the tax system should be. In framing fiscal measures the government used either these authorities or people trained by them. Consequently the fiscal system developed along carefully predetermined lines and embodies such ideals of justice as careful study and investigation would warrant.

Early Revenues. - The systematic development just outlined does not apply to the early revenues. These revenues existed before studies could be made, and were secured from any available source. In some parts of the country the methods in use were crude, while in others, as in the independent cities of advanced political and economic development, the fiscal system showed much more regularity. The real need for revenues was felt here, as in other countries, with the decline of feudalism. Numerous occasions, such as wars, would arise, in which expenditure was made distinctly for the common benefit.

Attempts were made to collect the needed funds from a poll tax, levied upon individuals, but measured by the income and property of the individual. When these failed to meet the needs, the officials would often go out and beg more funds - hence the term "bedes," which was applied to these early revenues. A particular set of "bedes," or voluntary payments, soon became a fixed charge, while further voluntary payments were often asked for particular purposes. It was a system of gradually converting a voluntary payment into a fixed one. The name "bede" still remains, though its early significance is lost. Certain classes were exempt from these payments, but were frequently asked to donate something to the use of the state.

Early Reforms. - When systematic studies began to be made, agitation for reform arose, and it was not long before some of the suggestions of the investigators were adopted. One of the first accomplishments was to destroy the old feudal relationship between the tenant and the proprietor of land. Many changes were made in the kind of land taxes and in the method of the assessment. The final result of the experiments was a tax upon the net rental of the land.

Throughout the early development the tax on buildings was included as a part of the land tax. When net rentals were adopted as the base for land assessments, however, the taxation of buildings was put in a separate category. In the cities the rental value of the building is usually taken as the base for assessment, while in rural communities a number of factors are considered. Another direct tax which received wide use, and which has been very productive, was the one placed upon industries of various kinds. Changes in industry necessitated many changes in this form of revenue. It is rather remarkable that, since so much of the early funds was secured from these sources, later all three were given over to the smaller political units, and the revenue collected was expended for local purposes.

Consumption and Income Taxes. - Consumption taxes were early used as sources of revenue. They were introduced with the abandonment of the feudal payments, were placed upon necessities, and were made applicable alike to urban and rural districts. The administrative problem proved so difficult, especially in the country, that it was not long before poll taxes were substituted in all but a few localities. Out of this uniform poll tax a class tax soon developed. Classes were formed on the basis of wealth, profession, and other characteristics, and each individual of a particular class was to pay a definite amount. These taxes, with some modifications as to classes and rates, formed the most important part of the system until the income tax was introduced.

The income tax was adopted about the middle of the nineteenth century, and since then has supplanted the former class taxes in importance, although the latter are still used to some extent. The scheme for taxing incomes has been modified with attempts to more nearly approach ability to pay. Progressive rates are found, not only for incomes of increasing size, but also on incomes from property as distinguished from incomes from labor. As might be expected, assessment difficulties have been hard to eliminate. A more detailed study of the Prussian income tax will be found in the chapter on Income Taxes.