The Mechanics of the Alcabalas: Reform, Local Bargaining, and Dwindling Taxation in New Granada, 1750–1810

Abstract

This article studies the mechanics of sales taxes in the viceroyalty of New Granada (present-day Colombia, Ecuador, Panama, and western Venezuela) during the second half of the eighteenth century. Advocating a careful examination of the accounting, institutional, and fiscal practices of North Andean customs houses, it provides an extensive discussion on how tax records can be harnessed to study the scope and nature of Bourbon reforms and to measure trade flows. The article pursues three interrelated goals. First, it studies the impact of local negotiations and jurisdictional fragmentation on local rates and revenue collection, providing new insights into the concrete mechanisms of tax bargaining. Second, the study reinterprets data on the main North Andean entrepôts of trade to measure fiscal cycles, real tax pressure, and tax incidence. Proposing a new method for examining customs records, this research shows how fiscal concessions and economic cycles led to diminishing fiscal revenues. Finally, the research places the viceroyalty within the broader context of fiscal change in the Spanish Empire, arguing that the region collected fewer revenues not only because of its comparatively smaller economic activity but also because the combination of custom and reform yielded lower taxation rates and unique fiscal structures.