Ferme générale

The ''ferme générale'' (, "general farm") was, in ''ancien régime'' France, essentially an outsourced customs, excise and indirect tax operation. It collected duties on behalf of the King (plus hefty bonus fees for themselves), under renewable six-year contracts. The major tax collectors in that highly unpopular tax farming system were known as the ''fermiers généraux'' (singular ''fermier général''), which would be ''tax farmers-general'' in English.

In the 17th and 18th centuries the ''fermiers généraux'' became immensely rich and figure prominently in the history of cultural patronage, as supporters of French music, major collectors of paintings and sculpture, patrons of the '' marchands-merciers'' and consumers of the luxury arts in the vanguard of Parisian fashions. In his 1833 novel '' Ferragus'', writer Honoré de Balzac attributes the sad air that hangs about the Île Saint-Louis in central Paris to the many houses there owned by fermiers généraux. Their sons or grandsons purchased patents of nobility and their daughters often married into the aristocracy. Especially members of impoverished aristocratic families were eager to marry daughters of the ''fermiers généraux'' in order to restore the wealth they had prior to their ruin. This was called in popular French ''redorer son blason'' (literally "to re-gild one's coat of arms").

History

Before the French Revolution in 1789, the public revenue was based largely on the following taxes:
*The '' Taille'' – Direct land tax imposed on French peasant and non-noble households, based on how much land they held. In some provinces, the principle of ''taille réelle'' was used, which meant that the tax was based on the actual market value of the real estate. In a majority of provinces the ''taille personnelle'' was applied: the tax level was the result of an arbitrary and gross estimation of the real estate value. Noblemen, public office holders and the inhabitants of the large cities were exempt from the ''taille''.
*The ''Taillon'' – Tax for military expenditure.
*The ''Vingtième'' (''one-twentieth'') – Based solely on revenue (5 percent of net earnings from land, property, commerce, industry and from official offices).
*The '' Gabelle'' – A very complicated system of taxes and outsourced regional monopolies on salt, with enormous price disparities between the different provinces (e.g. the salt price in Paris was thirty times higher than in Brittany) that were a strong enticement to smuggling.
*The ''Aides'' – National tariffs on various products, including wine and tobacco.
*The ''Traites'' – Custom duties for either the import or export of goods to and from France, or for the transport of goods from one French province to the neighbouring one (internal customs).
*The ''Octroi'' – A local tariff levied on products entering the cities, especially Paris.
*The ''Droits féodaux'' (feudal rights), a long list of petty duties for every possible event or activity in a peasant's life (the right to marry, to inherit, to use the mill, to use the roads of the local aristocrat, to be exempt from doing mandatory chores for the local lord, etc.), to be paid to the local lord, the King or both and generally considered by the peasant to be arbitrary and humiliating.
*The ''Dîme'' ("the tenth art – A mandatory tithe to support the state church and its clergy, collected by the local vicars, monks or bishops (and so, not a tax in the legal sense). The ''Dîme'' had to be paid either in legal tender (money) or in material assets by all residents regardless of their religion.

Tax farming before Colbert

The ''Ferme générale'' developed at a time when the monarchy suffered from chronic financial difficulties. The ''Affermage'' (leasing, outsourcing) of the collection of the ''traite'' (customs duties and taxes) had the advantage of guaranteeing the Treasury foreseeable and regular receipts, while reducing the perception of its role in tax-collection. The rights were initially contracted separately to various tax farmers, who were named ''traitants'' (who had the right to collect the ''traite'') or ''partisans'' (who had a share (''partie'') in the collection of the ''traite''). They were obliged to pay to the Royal Treasury the sum stipulated in their lease, and they received a share of the income and a share of any "unexpected" surplus. Each right was leased separately, which caused great administrative complexity: the taking of goods out of bond could involve several tax farms. Prior to 1598, this system had developed so that the tax farms were allocated among five ''pays'' (parts of France).

In 1598 the Superintendent of Finances, the Duke of Sully, entrusted tax collection to one farm instead of five separate ones, and subjected the collection of duties raised in the provinces to the rights of the King. The single tax farm was called the ''Cinq Grosses Fermes'' (five large farms). In 1607, he issued new rules (''Règlement Général sur les Traites'') on the collection of duties in an attempt to harmonize procedures. He also attempted to constitute the whole of France into a single customs area, but was without success, as the provinces "considered foreign" (i.e. which became part of France after the foundation of the Kingdom; especially the south and Brittany) refused to merge with the zone covered by the ''Cinq Grosses Fermes''. By the middle of the 17th century, France was divided for tax purposes into three principal zones:
*Provinces of the ''Cinq Grosses Fermes'' without any internal customs duties (since 1664 by decision of Colbert)
*Provinces "considered foreign" and therefore had negotiated lower rates on some taxes
*Provinces "effectively following the example of the provinces considered foreign" (i.e. the last to become part of France; especially Lorraine and Alsatia) which formed tax-free zones when doing trade with the neighbouring foreign countries.

Not all ''fermiers-généraux'' constrained their viewpoint to their own enrichment: Pierre-Paul Riquet, appointed collector in Languedoc-Roussillon in 1630, used his fortune to build the Canal du Midi that links the Mediterranean coast of France to Toulouse and then on to the system of canals and rivers that ran across to the Bay of Biscay on the Atlantic coast, considered to be one of the great engineering feats of the 17th century.

The farm under Colbert: ''traitants'' and ''partisans''

The process was further developed under the aegis of Jean-Baptiste Colbert, Minister of Finance to King Louis XIV.
To reduce the number of these farmers and to increase the share of the collection transferred to the Royal Treasury, Colbert sought to gather a great number of rights together in ''fermes générales'' (general farms). The first ''fermes générales'' was instituted in 1680 to collect ''gabelles'', ''aides'', ''taille'' and ''douane'' .

Although sometimes of obscure origin, the financiers which took these rights often quickly accumulated immense fortunes which enabled them to play a significant political and social role. Their greed and excesses shocked the public and were often turned into objects of ridicule in literature, for example by playwright Alain-René Lesage in his 1709 comedy '' Turcaret'', which was inspired by financier Paul Poisson de Bourvallais.

The ''Ferme générale'' (1726–90)

In 1726, all the existing farms were gathered in a single lease. The forty farmers-general, who held guarantees as contractors of the lease, became powerful and fabulously rich. Examples of the first generation of these tax farmers include Antoine Crozat, the first private owner of French Louisiana, the four Pâris brothers, and Alexandre Le Riche de La Poupelinière.

Increased criticism of the ''Ferme générale'' system led the government to introduce new regulations in 1769, which turned the collection of taxes and the administration of the service to which taxation was entrusted to public organisations, with their managers receiving a fixed remuneration. The public career of the reforming economist Anne-Robert-Jacques Turgot began with his appointment in 1761 as ''intendant'' of the ''généralité'' of Limoges.

In 1780, at the initiative of Jacques Necker, finance minister to Louis XVI, indirect taxes were distributed between three tax farm companies: the ''Ferme générale'' (for customs duties), the ''Ligue générale'' (for taxes on alcohol) and the ''Administration générale des domaines et des droits domaniaux'' (for land taxes and fees for land registration).

By the end of the 18th century, the ''Ferme générale'' system became a symbol of an unequal society. The ''Ferme générale'', and the great wealth of its proprietors, was seen as encapsulating all the perversions of the political and social system. People blamed the injustices and annoyances – which actually arose from the complexity of the tax system – on the company itself, including the brutality of tax collecting troops and the brutal repression of smuggling. The '' gabelle'' (tax on salt) was the most unpopular of all the taxes.

The ''Ferme générale'' was thus one of the institutions of the ''Ancien Régime'' which was most criticised during the 1789 French Revolution. It was depicted as a group of predatory tyrants; the Girondist politician Antoine Français de Nantes, made an early reputation for himself attacking this prominent target. The ''Ferme générale'' was then suppressed in 1790, with farmers-general paying the price at the scaffold: 28 former members of the consortium were guillotined on 8 May 1794. Among them was Antoine Lavoisier

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