The History Of Taxation And Money Closely Related

The history of taxation and money dates back thousands of years. The two histories are closely related. Money allowed the barter system to end and to be replaced by a wider system of exchange. It greatly improved exchange since it avoided the need for a double coincidence of wants on which the system barter system depended.

Currency can be defined as being a unit that allows or facilitates exchange. Archaeological and other evidence indicates that the first forms of currency may well have been livestock. Trade based on exchanging livestock seems to have started as early as 9,000-6,000 BC.

Following the introduction of permanent agriculture, crops began to be used as currency. A farmer might trade a quantity of barley for a sheep skin. This practice was first emerged and was prominent in China.

There is also evidence that by around 1,200 BC, the Chines began using cowrie (or cowry) shells as currency for trading. The cowrie shell is a marine gastropod or large sea snail. This shell has been used as a form of currency throughout history even into contemporary history be some remote tribes. Its early practice is notable since cowrie shell, unlike agricultural crops, has no inherent value in itself.

Around 1,000 BC, at the start of the Metal Age, Chinese people started using metal tools as currency. From that point, it was a short step to using metal coins. They came soon in the following decades.

The first Chinese coins were produced using base metals, not precious metals like silver or gold. Their early coins often were punched with a hole. This allowed coins to be tied together so that they could be carried more easily. It also helped maintain their security.

Around this time, in about 500 BC, a somewhat similar practice began to emerge in Lydia or modern-day Turkey. In that region, coins began to be used for exchange purposes. Unlike the base metal coins in China, Lydian coins were made from precious metals like gold and silver giving them inherent value as well as exchange value.

They were also stamped with distinct marking to indicate their assigned value. In the history of taxation and money, these Lydian coins are perhaps the earliest relative of the coins used today.

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