What do you understand by "Kosha Moolo Danda"? Discuss in the light of Kautiliya's tax administration.

February 25, 2022 February 21, 2024

Model Answer:
Kosha Moolo Danda, which means “revenue is the backbone of administration”, is sourced from Kautilya’s Arthshastra Part 8, Chapter 1. This implies that a nation’s status relies upon its fiscal power. He expressed that the Government’s power had source of treasury. This verse is used in the logo of Income Tax Department of India in Devanagari script. Kautilya has mentioned various types of taxes and duties such as those imposed on agricultural produce, trade, octroi, tolls and custom duties etc, some of which are even used today in general administration. Such as:
Custom Duty (Sulka), which consisted of import duty (praveshya), export duty (nishkramya) and gate tolls / octroi (dwarabahirikadeya); Transaction tax (vyaji), which included manavyaji (transaction tax for Crown goods); Share of Production (Bhaga) which included 1/6th share called (Shadbhaga); Tax in cash called (Kara), Taxes in Kind (Pratikara), which included Labour (vishti), for military (Ayudhiya), Counterveiling duties (Vaidharana), Road Cess (Vartani), Monopoly Tax (Parigha), Royalty (Prakriya) Taxes paid in kind by villages (Pindakara), Army Maintenance Tax (Senabhaktham) Surcharges (Parsvam). (167 words)