Trade Statutes of 1653 and 1667

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TRADE STATUTES OF 1653 AND 1667

The Trade Statutes of 1653 and 1667 governed domestic and foreign trade in seventeenth-century Russia, and streamlined a highly complex and confusing system of some seventy different internal customs duties that added to transportation costs and created ample opportunity for corruption and cheating. Subjecting all goods and merchants to a uniform and consistent set of customs duties promoted efficiency by making long-distance trade more profitable and predictable. The statutes also became key elements in the implementation of a mercantilist agenda designed to promote the interests of domestic merchants.

The commercial code (Torgovy ustav ) of October 1653 was adopted in direct response to an August 1653 petition by leading Russian merchants against transit duties and for a unified rate of customs duty. The code combined a uniform internal rate with an overall increase in imposts. It further adopted uniform measures of weight and length throughout the country. A basic 5 percent impost was levied on sold goods, with the exception of salt (double the rate), furs, fish, and horses (old duties applied). No duties were levied on foreign currency sold to the government at a fixed rate. A special duty of 2.5 percent was applied to goods offered exclusively in border towns for export. Under the 1653 code, foreign merchants were required to pay a 6 percent duty in the Russian interior, in addition to a 2 percent transit duty. However, exports from Arkhangel'sk were taxed at only 2 percent. A related 1654 decree (Ustavnaya gramota ) abolished transit duties on noble and church lands.

The dual agendas of mercantilism and protectionism culminated in the New Commercial Code (Novotorgovy ustav ) of 1667, again in an apparent response to a petition by Muscovite merchants. The New Commercial Code was apparently primarily authored by Afanasy Lavrentevich Ordin-Nashchokin, G. Dokhturov, and L. Golosov, and signed by ninety Russian merchants. The statute consists of a preamble, ninety-four main articles, and a seven-article appendix, Ustav torgovle, governing foreign trade. The introduction of the New Commercial Code spells out the leading principles of the government's commercial policy and constitutes the most elaborate expression of mercantilist ambitions in seventeenth-century Russian policy making. In addition to increasing government revenues, the statute sought to support domestic merchants by organizing facilities for credit and by promoting companies combining large- and small-scale merchants in an attempt to reduce the influence of foreign traders. However, the practical importance of these pronouncements remained marginal at best.

The new statute significantly increased the tax burden facing foreign merchants and made a further attempt to confine them to border cities through both restricted access to the interior and prohibitive transit duties. The New Commercial Code designated Arkhangel'sk, Novgorod, Pskov, Smolensk, Putivl', and Astrakhan' as "border towns" beyond which foreigners could operate only with special permission. Foreign specie receipts were to be maximized not only through higher tax rates, even on unsold goods, but also through a compulsory system of exacting those payments in foreign specie at a rigged exchange rate. The basic impost was increased to 5 percent on weighed goods and 4 percent on unweighed goods. An additional 9 percent was levied on transit by foreigners into the Russian interior. A sales tax of 6 percent, imposed in the towns of the interior, took the overall duty facing foreigners to an unprecedented 20–21 percent. Exacting the duty in foreign silver coin at a rigged rate yielded the crown two rubles in pure profit for every seven rubles collected. Emulating Western practices, the New Commercial Code imposed quality controls on import and export goods alike, although this measure appears to have been implemented with mixed success at best. Slightly preferential treatment was given to Asian merchants in the interior.

The immediate impact of the New Commercial Code was negative. Customs receipts declined, and tensions between Westerners and hostile gost (privileged merchant) administrators increased, as confiscations of goods as "contraband" multiplied. The concessions to Russia's elite merchants may in fact have been based on unrealistically rosy expectations at a time when a commercial treaty with Persia was set to ensure an increase in silk trade, while a peace treaty with Poland put an end to prolonged warfare in the West. A period of protectionism under Fyodor Alexeyevich's reign severely limited the right of Western merchants to operate in the Russian interior and sought to change the terms of trade at Arkhangel'sk in favor of Russians. This policy was only relaxed in the 1680s when Peter I's government finally conceded some key demands of Western merchants. The more hostile business environment at Arkhangel'sk not only deterred Western merchants but also contributed to a general diversion of Russian trade to the Baltic. The New Commercial Code remained in force, with minor modifications, until the adoption of the 1755 customs code.

See also: economy, tsarist; foreign trade; gosti; merchants