Many early states, such as Greece and Rome, furnish examples of well-developed fiscal systems. With the growth of feudalism, however, their importance waned, since under this regime the ruler had direct command over a large amount of economic goods and services. The burden imposed upon the individuals was often heavy - in fact, it was ordinarily no less than the burden imposed by modern taxes. Money economy had not yet developed, and these payments were made in kind. As money began to be used, and as the functions of the state began to be widened, a number of monetary payments appeared which at first were considered as commutations for some of the older feudal dues.
The first payments were demanded for such services as maintaining roads and bridges, for protecting travelers, and for the privilege of importing and exporting goods. It was not long until taxes were levied upon land and other marks of ability to bear tax burdens. The early base of most importance, other than land, was some form of building tax, sometimes upon the building itself, and sometimes upon some distinctive part, such as windows or hearth. It is interesting to note that the payment of these early taxes was looked upon as an indication of servility. No direct taxes were at first levied upon the freemen. The influences of this policy may still be seen in the methods of making assessments in some European countries.
Agriculture, in some form, was the predominant industry for many years. While this was true, taxes based upon land were, to a large degree, satisfactory, and complied reasonably well to principles of justice. Land, however, did not continue to be the sole source of income. Commercial pursuits, and other trades and crafts developed, which made it possible to secure a living, and more, without owning or directly using land. The governments began to extend their services, which meant the need for more revenues. It seemed expedient to secure a part of the increased revenue from these new forms of wealth, and the early tax systems of various countries indicate a branching out to new sources of revenue. The development was not always the same, and different taxes were used in different countries. It will be instructive to trace briefly the development of the tax system in some of the more important countries.