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Charles Handling of Finance (Revenue (Plundered wealth of Indies- revenues…
Charles Handling of Finance
Revenue
Plundered wealth of Indies- revenues from Indies steadily grew during his reign- enabled him to borrow money from markets using revenues as collateral
Extracted increasing amounts of taxation from the people of Castile and the Church
Castile contributed most of income that came to Charles through Spain
Charles exploited taxes already set in place by 1516- little resistence from Cortes
1556- Revenues 2.9 million ducats per annum roughly 3.5 times what it had been in 1516
Annually collected taxes and revenue sources- included alcabala, custom duties, rents derived from crown lands, the seda in Granada, the salanas, and servicios voted by the Cortes
Had exceptional or extraordinary sources of revenue- derived from clerical taxation such as the cruzada and the tithe, the annual bullion shipments from the indies, the sale of crown lands and juros
Most important revenue source was the alcabala- everyone had to pay whatever income- 10% sales tax- grew steadily during 16th century- brought in around 1 million ducats in 1556- one third of his revenue
Charles established crowns right to receive Servicio granted by Castilian cortes on a regular basis
Pope allowed Charles to receive proportion of all income of the Spanish church- 1532- 372,000 Ducats raised in this way by 1551 reached 500,000 ducats
Cruzada- paid by both laity and clergy- between 1523-1554- raised average of 121,000 ducats a year
Spending
Charles spent most of his reign at war- Ottoman Turkey, France and German protestants- costs associated with need to fortify his possessions and with the amphibious campaign against the barbary corsairs and the Turks in the Mediterranean
Defending coastline against raiders and pirates incurred further costs, and the flota, the Atlantic fleet that protected the vital Indies bullion route grew from year to year
Internal revolts in Castile and Aragon had to be suppressed and this was costly, as well as depriving the crown of taxation during the period of revolt
Court expenditure rose sharply- maintained a lavish Burgundian style of court fit for an emperor
Introduced a new, expensive military order to Spain, the Order of the Golden Fleece
Imperial election of 1519 cost a fortune, in bribes and electoral costs
Brought art and financed expensive building projects in Segovia, Toledo Granada and elsewhere
Charles had to service a growing debt- interest payments on royal debt account for almost half of Charles's income by 1556
Charles issued juros (long term loans on interest) and asientos (short term high interest loans) which increased debt over time