in August, 1531.

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In one he says that there are 50,000 pesos Tipuzque" circulating in the country, and that this base gold if converted into ordinary pesos de oro, would approximate 30,000 of the better sort. In the other, speaking of the rent paid to Cortez for the housing of the Audiencia in a portion of his palace, Salmeron remarks that the 9,000" pesos corriente " already paid the Marquis equal about 6,000" pesos de oro de minas." Lastly there is the testimony of Bernal Diaz del Castillo that the Spanish authorities in the beginning circulated gold of three carats less than the legal fineness in order to aid the soldiers in the payment of their debts, and incidentally to defraud the merchants who had come to Vera Cruz to trade. This baser gold, he continues, was called "Tipuzque," an Indian word meaning copper. Eventually the Emperor, moved by petitions from the colonists, ordered the payment of customs dues (almojarifazgo) and judicial fines (penas de camara) to be made in this "oro de Tipuzque," so as to withdraw it from the country.

Soetbeer and Lexis have made clear that the usual standard of value in the Indies in the first half of the sixteenth century was a peso de oro worth 450 maravedis and about 22 carats fine (a peso 22 carats fine was strictly worth 454 maravedis; a peso of 450 maravedis was strictly 21.81 carats fine). Their conclusion is confirmed by the colonial records in Seville. This peso was not a coin, but an imaginary unit; it represented, like the castellano in Spain, one-fiftieth of a marc of gold; and it came to be known as the " peso de oro de minas." As the relation between gold and silver was roughly taken to be 1-10, a marc of silver was said to be worth five of these pesos de oro. Very soon, however, silver was reckoned at the legal value set upon it in Spain, 65 reals or 2,210 maravedis, which implied a ratio of 1-10.18, very close to the legal ratio, which was 1-10.11.

The peso de oro de minas was the unit of exchange from the conquest until the thirties of the sixteenth century. Men paid in uncoined gold of a certain weight and fineness. But in the thirties the output of the Mexican silver mines began to be felt, silver became more common than gold, and was used more and more as a circulatory medium. And as till 1537 there was no American currency, silver too was used by weight as equivalent for these imaginary pesos de oro. After 1537, however, when a mint was in operation in Mexico City and silver pieces of eight reals were issued, the silver peso naturally superseded the peso de oro de minas as a unit of value. But the process was a slow one, and till well into the following century the imaginary peso of 450 maravedis continued to be used in buying and selling bar gold and silver (Soetbeer, op. cit., p. 135, says that it was used only in connection with gold bullion). The silver peso of eight reals or 272 maravedis was the famous Spanish dollar or piece of eight" of trade the world over.

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Of the numerous kinds of gold mentioned in the ledgers of the royal treasurers of Mexico, it is probable that "oro de ley perfecta" represented pesos of the full value of 450 maravedis. If this gold was rated 50 per cent higher than current or common gold, the latter must be worth only 300 maravedis and have a fineness of about 15 carats. If current gold with three carats added was worth 60 maravedis more than before, its value must be about 360 maravedis. This is confirmed by

the statement of the treasurer that it was 20 per cent higher. And the whole reasoning falls in with the remark of Salmeron that 9,000 pesos "corriente " equalled 6,000 pesos de oro de minas. It may also help to explain the statements of some seventeenth century writers that there was an imaginary unit called the peso ensayado of nine reals (306 maravedis.) (Brit. Mus. Add. Mss., 13,976, fol. 46; Veitia Linaje: Norte de la Contratacion, p. 274.)

The value of the "oro de Tipuzque " is always clearly indicated by the treasurers - 272 maravedis. It agrees with the other testimony of Salmeron, that 50,000 pesos de Tipuzque were worth 30,000 of the better pesos.

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These figures afford a reasonable explanation of the early Mexican treasury records. At the time of the conquest the Spaniards brought with them from the West Indian islands the peso do oro of 450 maravedis. But owing to the crude means of testing the fineness of gold in the jewels, ornaments, etc., constituting the most important part of the plunder, that which passed for "oro de ley" was much closer to 18 than to 22 carats. Moreover the weights used by the conquerors were evidently at fault. In fact we are told by Bernal Diaz that they had to manufacture their own scales and weights to ascertain the value of their booty. Lastly, the Spaniards deliberately debased the gold in circulation, as recorded by this same chronicler. It was doubtless to correct this final blunder that after August 1, 1523, three carats were added to every peso of bullion refined by the royal officials, as we discover in the ledgers of 1522-24. The actual value of the peso before this correction was about 300 maravedis, after the correction about 360 maravedis. The latter was the "peso corriente con tres quilates anadidos." Each, however, in the beginning was current as the peso de oro of 450 maravedis.

Most of the gold in circulation between 1524 and 1530 was in one or the other of these forms. But in the records of these same years we find appearing for the first time "oro de ley perfecta "; and this seems to have been the peso finally raised to its full weight and fineness. Such gold always paid one-fifth to the crown, while other bullion was taxed at rates ranging from one-sixth to one-twelfth.

In the accounts of 1530-31, only "oro de ley perfecta" and " "'oro comun" are the units used. "Oro de minas" is mentioned, but it refers rather to the source of the gold than to the value of the peso. Not till 1531-37 do we find the "oro de Tipuzque,” worth 272 maravedis. It is contrasted with oro de ley perfecta" and with "oro de minas de marca real." It was likely the "oro comun" of earlier ledgers, from this time forward accepted by the government at a considerable discount from its current value in the country. Bernal Diaz says that it was all

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withdrawn from circulation and shipped to Castile (Hist. Verdadera, cap. 157); but his statement is not borne out by the evidence of the treasurers' records.

From 1531 onwards, then, there were only two kinds of pesos legally current in Mexico, that worth 450 maravedis, and that worth 272. The latter either by chance or by policy equalled exactly in value the "pieces of eight" which were coined in Mexico City after 1537, and which soon became the standard money of the country. The former remained an imaginary unit employed for another 150 years in transactions dealing with the bullion at the mines.

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The earliest treasury records of New Granada mention three forms of gold oro fino," oro bueno," and oro bajo " (or "chafalonia "). There was no Casa de Moneda in the colony in these early years, and consequently no coinage of silver pesos. In 1559 and 1560 the audiencia complained of this state of affairs, and urged the establishment of a mint for the issue of silver and vellon (A. de I., 116, 5, 6, lib. ii, fol. 3). In 1563 the lic. Angelo de Castejou wrote that in Pamplona gold-dust was still the current medium of exchange. From the treasurers' accounts, moreover, it is clear that the amount of silver produced by the country was almost negligible. Gold must therefore have been almost the sole medium in use, and the likeliest unit of value was the peso of 450 maravedis, the one common in all parts of Spanish America before the minting of silver. And as in the later accounts, from 1547, when the colony was more settled, the receipts are almost universally reckoned in "pesos de buen oro," I have identified this particular form with the peso de minas of Mexico and Hispaniola.

"Oro fino" appears of less and less importance in the years succeeding the foundation of the "realm." It seems reasonable to suppose that this might represent treasure obtained by the Spaniards in the form of gold-dust. In the beginning gold-dust would be the handiest circulating medium; and at first it would probably be computed at its own weight and value rather than as interpreted in pesos de minas. As it would have a very high degree of fineness, it might easily be current at the value given the gold peso or castellano in Spain, 490 maravedis (the peso de oro 24 carats fine was worth 495.26 maravedis). Such, at least, is the value I have assumed for it.

The peso de minas was also carried by the conquistadores to the Pacific coasts of South America; and continued to be the general unit of value till the establishment of mints in Peru brought about a repetition of the situation in Mexico.

One more type of peso in Spanish America needs to be mentioned. Francisco de Toledo, viceroy of Peru (1569-81), issued an order that when the quinto and tribute of the Indians was paid in silver or reals, the peso was to be reckoned at 12} reals (425 maravedis). This was later

called the " peso ensayado de tributos." Philip II, by a cedula of June 29, 1592, extended the order to all the Indies. (Recop., lib. viii, tit. 8, ley 8.)


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1. Developments to 1910. Commission of 1908, 481.- Partial adoption of its recommendations, 482.-II. Tax rate limitation, 488. Origin, 488. — Provisions, 489.- Influence on expenditures, 492.- Influence on return of property, especially intangible, 494. Future of the policy, 501. - III. Centralized assessment. Tax commission's proposals, 503. — The Warnes law; appointive assessors, 508. — Effect on property valuations, 511. Further effects, 514. — IV. Conclusion, 516. Method of selecting assessors, 517. — Amendment of the constitution, 518. — Administrative methods; taxation at source, 519.


THE Ohio constitution of 1851, substantially following the Kelley tax law of 1846,1 fastened the general property upon the state by its provision that

"Laws shall be passed, taxing by a uniform rule, all moneys, credits, investments in bonds, stocks, joint stock companies, or otherwise; and also all real and personal property, according to its true value in money. . . ."2


An act of 1852 brought the tax laws more fully into accord with the new constitution, and acts of 1859 and 1878 codified the various scattered provisions of the statutes relating to taxation. Aside from the development of the tax on foreign insurance companies, of the franchise tax on the capital stock of corporations, of the excise taxes upon public service corporations, and

1 44 Ohio Laws, 85; amended by 45 Ohio Laws, 60.

2 Article XII, Section 2, Constitution of Ohio.

50 Ohio Laws, 135.

75 Ohio Laws, 436-507.

456 Ohio Laws, 175-218.


of the " unit rule" in the assessment of the property of express, telegraph and telephone companies 1 there was little important tax legislation during the next halfcentury.

The beginning of the recent tax reform movement in Ohio may fairly be dated from the report of the Honorary Commission of 1908, which directly attacked the general property tax, as well as the administrative system which had resulted from a half-century's piecemeal legislation. The recommendations of the commission were: (1) a constitutional amendment abolishing the general property tax; (2) a state tax board to administer all laws for the collection of state revenues and to make recommendations; (3) more frequent appraisement of real estate; (4) the separation of state and local revenues; and (5) publicity in local taxation.2

The recommendations which related to administrative features of the tax system were, on the whole, cordially received. An act of March 12, 1909, as amended in 1910, provided that appraisals of real estate for purposes of taxation should be quadrennial, instead of decennial as theretofore. The unsatisfactory character of these infrequent appraisements is made clear by an examination of assessed valuations between 1871 and 1910. During this period the valuation of land and improvements increased $631,325,597. Between the decennial appraisals, assessors of personalty were required to make additions for new buildings and deductions for destroyed buildings: the net additions to the real estate duplicate on this account amounted in

1 For a convenient account of these taxes, see E. L. Bogart, Financial History of Ohio (vol. i of the University of Illinois Studies in the Social Sciences), pp. 323-329, 336-345. This and later legislation is also described by Professor Bogart in the American Economic Review, vol. i, pp. 505-518. Possibly the liquor tax should be included in the list of important tax legislation.

Report of the Tax Commission of Ohio,
100 Ohio Laws, 81.

1908, pp. 34-45.

101 Ohio Laws, 7.

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