In the past, subordination to the state — in the form of conscription, taxation, and commodity pricing policies that favoured urban consumers—was regarded as a basic definitional criteria of the peasantry.
In Thailand, one of the forms this subordination took was the rice premium, which taxed rice exports both to generate government revenue and to reduce domestic rice prices for urban consumers. This “deliberate taxation of the poorest part of the population” (Silcock 1967) contributed around 20 percent of total government revenues during the 1950s and about 10 percent in the 1960s. It meant that rice farmers made a disproportionately high contribution to national tax coffers and also subsidised the food costs of the urban population.
However, over the past few decades the situation has changed. Industrialisation and diversification has been accompanied by a steady reduction in the fiscal burden on farmers. Political agitation and electoral mobilisation in rural areas has made agricultural taxation less attractive. The rice premium was abolished in 1986.
At present I don’t have a clear picture of the various taxes paid (directly or indirectly) by farmers in Thailand (if someone could point me to some good sources I would be very grateful). My experience of land tax, for example, is that it is very low indeed. Overall I get the impression that the flow of government revenue into rural villages is higher than the flow of taxation revenue out of them (though measuring this would be complicated given the enormous occupational diversity of rural households). I think that the emergence of this new fiscal balance has been accompanied by growing rural expectations that the state will provide health, welfare and education services along with infrastructure and a degree of protection from market fluctuations.
In an article that I find very thought provoking, Partha Chattajee argues that there has been an important shift in the political culture of the Asian peasantry. According to Chattarjee, peasant producers are still under livelihood pressure from market forces over which they have limited control. However, “government agencies have to find the resources to … provid[e] alternative means of livelihood to those who have lost them”. This livelihood support is provided in the form of poverty alleviation programs, employment guarantees, micro-credit schemes and emergency subsistence support. It helps sustain both agricultural commercialisation and livelihood diversification. The basic aim of government action is to guarantee livelihood security rather than to promote capital accumulation. It is driven by an emerging political consensus about the importance of welfare and development, by state desires to avoid social disruption, and by a recognition that the industrial sector simply cannot absorb the large numbers of people who would be displaced from unviable rural economies.
The result, according to Chatterjee, is a new form of “political society” in which the state is in the thick of peasant life and in which peasants are skilled at negotiating access to the state’s largesse.
What are the fiscal underpinnings of Thailand’s rural “political society”? Is the state really providing more resources for rural areas than it is taking out?