Jump to ContentJump to Main Navigation
‘Living Water’Vodka and Russian Society on the Eve of Emancipation$

David Christian

Print publication date: 1990

Print ISBN-13: 9780198222866

Published to Oxford Scholarship Online: October 2011

DOI: 10.1093/acprof:oso/9780198222866.001.0001

Show Summary Details
Page of

PRINTED FROM OXFORD SCHOLARSHIP ONLINE (www.oxfordscholarship.com). (c) Copyright Oxford University Press, 2017. All Rights Reserved. Under the terms of the licence agreement, an individual user may print out a PDF of a single chapter of a monograph in OSO for personal use (for details see http://www.oxfordscholarship.com/page/privacy-policy). Subscriber: null; date: 26 February 2017

(p.393) Appendix 2 Accounts

(p.393) Appendix 2 Accounts

Source:
‘Living Water’
Publisher:
Oxford University Press

These accounts are attempts to reconstruct the budgets of some of the participants in the vodka trade. I have grouped them under five headings:

  1. (A) Estimates of Total Turnover: Account 1.

  2. (B) Taverns: Account 2, Budget of a ‘shinok’ in the privileged provinces.

  3. (C) Tax Farm accounts:

    1. Account 3: Estimates for all Great Russian Farms, 1859.

    2. Account 4: ‘Average’ provincial and district tax farms, 1859.

    3. Account 5: Account of large tax farm, Gt. Russia, 1857–8.

    4. Account 6: Accounts of a district tax farm, Novgorod province, 1856.

    5. Account 7: Accounts for all Gt. Russian tax farms, 1851–5.

  4. (D) Government accounts: Account 8, 1847–59.

  5. (E) Distillers' accounts: Account 9, Penza, 1860.

The accounts are reconstructed from a wide variety of different sorts of evidence. Evidence for the tax farms is particularly hard to obtain, as most tax farmers had good reason to hide the details of their budget; yet these inaccuracies affect calculations of the total turnover of the vodka trade. Government accounts are probably more reliable. Distillers' accounts are based on a single (though very good) essay by the writer, Leskov, which discusses the distillers of Penza province. Finally, I include a brief estimate of the budget of a small tavern in the privileged provinces.

In all cases, I have had to make the odd guess about the interpretation of different categories, and sometimes I have had to interpolate figures from other sources. All of this means that one cannot demand much precision of these accounts. The differences in approach and source material of the various accounts also pose a problem; but it can be turned to advantage for where utterly different types of accounts produce figures that are not only internally consistent but also consistent with each other, this justifies taking them more seriously than if there was no way of checking them for consistency at all.

What the accounts do show is the orders of magnitude. They give us some idea of the importance of different items of expenditure and revenue. They give us some feeling for, say, the importance of vodka sales in tax farm revenues, or the extent to which administrative costs cut into the government's own revenues. And they suggest at least the orders of magnitude of the profits made in different sectors of the vodka trade.

(A) Estimates of total turnover

These calculations, though important, are also difficult. We have reasonably reliable figures on the government's income from the trade, and in the Great Russian provinces we have reliable figures on the amounts of vodka sold by distillers to the government and then resold to the tax farmers. We also have (p.394) figures on the amounts of vodka on which excise was paid in the privileged provinces. But in neither region do we have accurate figures on the retail trade, particularly on the extent to which sales were artificially increased by illegal purchases from distillers, adulteration, and undermeasuring. Nor do we know the real retail prices. So all these figures have to be estimated. With the help of contemporary guesses, it is possible to estimate the real volume of sales and real retail prices with some plausibility for the Great Russian provinces in 1859. Estimates for the privileged provinces, however, are much less reliable.

The set of calculations in Table 13.1 are for the area of the Great Russian and Siberian tax farm in the last years of the tax farm. Any calculations must begin with what we know of the government's revenues and the amounts of vodka which passed through its hands.

Table 13.1. Government revenues from sales of vodka, 1859–1860

Pop. (m.)

Rev. (rubles)

Rev. per cap. (rubles)

Gt. Russ. and Sib.

39.75

96,208,168a

2.42

Priv. prov.

18.72

22,983,857b

1.23

Baltic

1.7

801,650c

0.47

TOTALS

60.17

119,993,675

1.99

(a) Tax: 41,529,133; payment for vodka cuotas: 54,679,035; costs: 16,371,114 (820,432 for administrative costs and 15,550,682 for purchases of vodka); i.e. net revenue: 79,837,054 (per cap. 2.01).

(b) From excise and retail tax farms.

(c) From towns and distilling tax.

Source: Trudy, pt. 1, no. 12: 2. I have averaged the figures for 1859 and 1860. Population figures from Korsak, ‘O vinokurenii’, 375.

These figures include the government's gross income, so they also cover payments to distillers in the Great Russian and Siberian provinces. But they do not include entrepreneurial profits either in the Great Russian provinces and Siberia (tax farm profits) or in the privileged provinces (profits of tax farmers, and gross incomes of retailers and distillers). They are, therefore, a minimum estimate of total turnover for the Empire as a whole, and for per caput expenditure on vodka.

We also have figures on the amounts of vodka sold, officially, by the government (Table 13.2). To estimate total turnover from these figures we must estimate the extent to which the amounts of vodka sold were artificially increased; and the real prices at which the adulterated product was sold. We know, first, how much vodka the government sold the tax farmers in the Gt. Russian provinces in 1859: 20,127,234 buckets of 38° polugar.1 Secondly, we have the guess of a well-informed contemporary that illegal purchases of vodka by tax farmers directly from distillers, as well as the legal allowance of a sort of (p.395)

Table 13.2. Buckets of 38° vodka sold officially in 1859–60

Area

Buckets

per cap.

Gt. Russia and Sib.

25,561,587a

0.64

16 priv. provinces

29,482,105

1.57

Baltic

1,973,684

1.16

TOTAL

57,017,376

0.95

(a) This figure includes guesses for various types of ‘economies’, as estimated below; other figures calculated from Trudy, i, no. 12: 4; in the privileged provinces most vodka was sold at a strength of c.48° (48% alcohol by volume) and in the Baltic at c.50°. I have translated all amounts into 38° vodka, the standard strength in the Great Russian provinces.

discount of several degrees to allow for leakage in effect added another 7 per cent to the amounts sold by the tax farmers (in practice tax farmers forced distillers to allow them a discount of about 20 buckets in every 1,000, while the government allowed them to sell 41° vodka at a strength of 38° to allow for leakage and losses in transport).2 This meant, in effect, that retailers sold 7 per cent more vodka than they paid for. Third, contemporary discussions of adulteration and under-measuring suggest that each technique could, in effect, add up to 10 per cent to the volume of sales.3 Altogether, cheating distillers by 7 per cent and customers by 20 per cent implies ‘economies’ of 27 per cent, as a result of which the real volume of sales (of what was now a sort of ‘pseudo-polugar’) may have been closer to 25,561,587 buckets. But instead of regarding this as an increase in the volume sold, it will be more convenient in the interests of simple accounting to regard it as an increase in the effective price of each bucket purchased legally from the government. In what follows, I have adopted the conservative estimate that such ‘economies’ increased the effective retail price by about 20 per cent.

Combined with an estimate of the population of the Great Russian provinces and Siberia in 1859 (of 39,750,000),4 these figures yield an estimate of real per caput consumption as opposed to official consumption. They suggest that while the official per caput consumption level was about 0.51 buckets in the Great Russian provinces, the real level was closer to 0.64 buckets, though much of the increase consisted of little more than water (or air).

Secondly, we have estimates of the real prices at which these dubious liquids were sold. The best estimates come from a government survey into retail prices conducted in 1859, in response to peasant protests at the high price and low quality of the vodka sold under the new tax farms which had begun operations in January. Officials of the Ministry of Finance took samples in 114 districts and (p.396) towns of 9 provinces. Nowhere did they find polugar sold at the official price of 3 rubles. Instead, they generally found something described as an ‘improved’ polugar, even though it was usually sold at ‘ten degrees below its proper strength’.5 In the rural tax farms, prices for vodka sold by the glass ranged from 3.75 to 8 rubles a bucket, with a mean of 6.10 rubles; in the provincial capital tax farms, prices ranged from 5 to 10 rubles, with a mean price of 6.97 rubles. Bulk prices (for sales by the bucket or more) were lower, from 4 to 6 rubles a bucket, but as most vodka was sold in small quantities, the higher prices are probably a better guide to average prices.6 Thus, an average estimate of 6 rubles a bucket is, if anything, on the low side.7

Adding 20 per cent to this estimate of retail prices, to allow for ‘economies’ in sales, yields an effective retail price of 7.20 rubles, and a total turnover for the trade in the Great Russian provinces alone of about 145 million rubles. (See Account 1.) This implies a per caput expenditure of about 3.65 rubles (or about 21.89 rubles for a household of six), which is, at least, consistent with the scattered budgetary evidence presented earlier. For all their unreliability, such calculations provide us with some benchmarks with which to compare other, equally flimsy calculations which have been made elsewhere.

These figures also suggest an average turnover for every liquor outlet of about 1,300 buckets, and about 8,000 rubles. For taverns, the average is probably higher. The first figure squares with the comment that taverns generally received vodka in amounts of no more than one or two ‘casks’, i.e. 40–80 buckets/week.8

To extend these figures to the whole Empire is a trickier business. In the absence of even plausible guesses of illegal sales and real retail prices in the privileged provinces, the best we can do is to play with the figures that are available. We know that, altogether, the government itself earned 23,785,507 rubles from the Baltic and privileged provinces in 1859–60, on sales of 31,455,789 buckets of 38° vodka, which implies an average tax of about 75 k. a bucket. If the retail price in this region was 3 rubles, or 4 times the level of taxation (as in Account 2, below), this would imply a turnover for the region of about 95 million rubles, which, added to the 145 million rubles estimated as the total turnover in the Great Russian provinces would mean a total turnover for the whole Empire of about 240 million rubles. This figure would imply a per caput expenditure on vodka for the whole Empire of about 4 rubles (the equivalent of 24 rubles for a household of six). If the retail price in the western region was only 3 times the tax level, or 2.25 rubles a bucket (Trudy, i, no. 12, p. 23 gives av. retail price of 2.50, and 1.50–2.00 in Baltic), then turnover would have been about 70 millions, and total turnover for the Empire as a whole about 215 millions (suggesting a per caput expenditure of about 3.60, or about 21.60 rubles for a household of 6).

These estimates are slightly higher than those adopted by the Government Commission responsible for abolishing the tax farm. This concluded in 1861 (p.397)

Account 1

Table 13.3. Cheat Russian tax farm revenues 1859a

Gross Revenue/bucket (rubles)

Sector Revenue

Share of total turnover (million rubles)

Rubles

%

Distillers receive

0.72

0.72

10

14

Government receives

For vodka

2.41

1.69

23

34

In tax

1.99

1.99

28

40

TOTAL

4.40

3.68

51

74

Tax Farmers receive

Av. price

6.00

1.60

22

32

20% ‘econ.’

1.20

1.201

17

24

TOTAL

7.20

2.80

39

56

TOTALS

7.20

7.20

100

145

(a) Assuming ‘economies’ of 20 per cent.

Sources: Distillers' receipts: Svedeniya, iii. 35 gives the no. of buckets purchased from distillers by the government (20,127,234); iii. 14 gives the total amount paid by the government (14,396,049 rubles); together they give a cost price of 72 k.; iv. 281 gives cost price for each province. Government receipts: Svedeniya, iii. 47, recalculated, using the total of vodka sold to the tax farmers, and totals for excise amounts actually paid in 1859 (40,115,988 rubles) and for vodka (48,451,077 rubles), from iv. 177. Tax farm receipts: these calculations, based on Svedeniya, iv. 454–61, are explained above.

Appendix 2 Accounts

Fig. 13.1 Division of the spoils: revenues from the Great Russian tax farm 1859

(p.398) that: ‘The sums spent by the population on vodka can be calculated only approximately, and no detailed proposals can be founded on them. This evidence available on the retail prices of vodka suggests that this sum lies between 180,000,000 and 200,000,000 rubles a year…From this sum, up to 103,500,000 goes to the Treasury, up to 40,000,000 goes to cover the cost price of vodka [i.e. to distillers], and the rest [40–60 million] goes to the tax farmers and other retailers of vodka.’9

(B) Taverns

Account 2

Table 13.4. Accounts of a landlord's shinok in west, late 1850s

Rubles/bucket

%

Income

Sale price of vodka

3.00

100.0

Expenditure

Cost of vodka

0.80

40.0

Excise

0.75

37.5

Total cost of vodka

1.55

77.5

Wages of tavernkeeper

0.20

10.0

Retail licence

0.10

5.0

Buildings, etc.

0.15

7.5

Total other costs

0.45

22.5

TOTAL EXPENSE

2.00

100.0

General accounts

Total income

3.00

Total expense

2.00

Net profit

1.00

Profit margin

33.3

Source: Sovremennik, 72 (1858), no. 12, Dec. ‘Sovremennye zametki’, 298.

(C) Tax farm accounts

The sets of accounts that follow represent my own attempts to make sense of the few figures available. They are an attempt to calculate accounts as if the available figures were reliable. In reality, they are not. Nor are the figures always complete or the definitions unambiguous, so that some interpolation has been necessary, and some interpretation of the figures. What the calculations do show is some large magnitudes, of which perhaps the most striking is the importance in both expense and income accounts of the vodka trade itself, and, in the expense accounts, of payments to the government. When the accounts suggest conclusions as striking as these, they probably do deserve to be taken seriously, (p.399)

Appendix 2 Accounts

Fig. 13.2 The costs of running a tavern

especially if the evidence from different sets of calculations points to the same conclusion.

Accounts 3 and 4 are not independent estimates, but different ways of adding up similar sets of figures. However, accounts 5, 6, and 7 come from entirely different sources, and should, therefore, provide some check on the reliability of the first two, more detailed, sets of accounts, which are based on figures used by the government commission which prepared Svedeniya.

Account 3

Table 13.5. Estimated accounts of Gt. Russian tax farms, 1859

(a) Income account

Thousand rubles

% of turnover

From sales of vodka

In 2 capitals: quota = 2,235,000 buckets sold at av. of 7 rubles/bucket

16,763

13.5

In 28 prov. caps.: quota = 2,707,000 buckets sold at av. of 6 rubles/bucket

16,242

13.1

279 port and district farms: quota = 11,561,000 at av. of 5 rubles/bucket

57,805

46.6

Total (quota = 16,500,000 buckets)

90,810

73.2

Adulteration

Assuming 10% increase

9,081

7.3

Sales above quota

3,500,000 buckets

19,250

15.5

TOTAL FROM SALES OF VODKA

119,141

96.0

From sales of beer and mead

In capitals

150

0.1

In prov. caps.: 10,000 each

280

0.2

Ports and district farms at 2,000 buckets each

558

0.4

TOTAL FROM BEER AND MEAD

988

0.8

From sales of cold food licences to taverns

In capitals

100

0.1

Other tax farms

50

0.0

TOTAL FROM FOOD LICENCES

150

0.1

Fines on tavernkeepers

120

0.1

Excises, licences on other enterprises

Restaurants: 565 in caps.

850

0.7

555 in prov. caps.

280

0.2

777 in district tax farms

200

0.2

Wine cellars:

900 in caps, and prov. caps., and 370 in district tax farms

700

0.6

450 Porter shops

200

0.2

Beer/mead brewing licences

400

0.3

Vodka manufacture licences

800

0.6

Excises on grape and fruit wines, lacquer manufacture etc.

300

0.2

TOTAL EXCISES, LICENCES, etc.

3,730

3.0

GROSS INCOME

124,129

100.0

Source: Based on figures in Svedeniya, iii. 85–93, 116–17, iv. 214.

(p.400)

(b) Expense account

Thousand rubles

% of gross exp.

Payments to govt.

For quota: 16.5 mill, buckets

48,500

46.1

For 3.5 mill. buck, over quota

2,485

2.4

For excise articles (bids)

40,000

38.0

TOTAL PAYMENTS TO GOVT.

90,985

86.5

Running costs of tax farms

Wages

7,560

7.2

Admin, expenses

3,403

3.2

Bribes

1,755

1.7

TOTAL RUNNING COSTS

12,718

98.6

Interest on sureties and working capital

1,437

1.4

GROSS EXPENSES

105,140

100.0

Source: Based on figures in Svedeniya, iii. 85–93, 116–17, iv. 176–7, 214.

(p.401)

(c) General accounts

Thousand rubles

%

Gross income

124,129

Gross expenditure

150,140

Net profit

18,989

Profit margin

15

Markup (gross inc./payments to govt.)

136

Appendix 2 Accounts

Fig. 13.3(a) Income of Great Russian tax farms 1859 (b) Expenses of Great Russian tax farms 1859

(p.402)

Account 4

Table 13.6. Accounts of ‘average’ provincial and district tax farms, 1859

(a) Income account

Prov. farm

Dist. farm

rubles

%

rubles

%

From sales of vodka

Quotas (96,700 & 41,500 buckets at 6 & 5 rubles)

580,200

71.9

207,500

73.5

+ 10% adulteration

58,020

7.2

20,750

7.3

+ 20% above quota

116,040

14.4

41,500

14.7

TOTAL SALES

754,260

93.4

269,750

95.5

Beer and mead sales

10,000

1.2

2,000

0.7

Cold food licences

2,000

0.2

Fines on taverns

1,200

0.1

700

0.2

Excises, licences

40,000

5.0

10,000

3.5

TOTAL OTHER INCOME

53,200

6.5

12,700

4.4

(b) Expense account

Prov. farm

Dist. farm

rubles

%

rubles

%

Cost of vodka

Quota (at 2.41/bucket, assuming av. quotas of 96,700 & 41,500)

233,047

43.9

100,015

43.3

Above quota (20%, at 80 k./bucket)

15,472

2.9

6,640

2.9

Excise payments to govt. (at av/of 2.00/bucket)

193,400

36.4

83,000

35.9

TOTAL TO GOVT.

441,919

83.2

189,655

82.1

Running costs

Wages

35,000

6.6

20,000

8.7

Rents

7,000

1.3

2,000

0.9

Overheads

Offices

2,000

0.4

600

0.3

Horses/carriages

2,000

0.4

1,200

0.5

Vodka transport

4,000

0.8

2,200

1.0

Repairs

5,400

1.0

2,000

0.9

Bribes

13,000

2.4

3,700

1.6

TOTAL

68,400

12.9

31,700

13.9

NET EXPENSE

510,319

96.1

221,355

96.0

Est. deprec. 25%

12,500

2.4

6,250

2.7

Interest

Sureties 6%

5,100

1.0

1,800

0.8

Working cap. 10%

3,500

0.7

1,500

0.6

TOTAL INTEREST etc.

21,100

4.0

9,550

4.1

GROSS EXPENSE

531,419

100.1

230.905

100.1

(c) General accounts

Prov. farm

Dist. farm

rubles

%

rubles

%

Total income

807,460

282,450

Gross expense

531,419

230,905

Net profit

276,041

51,544

Profit margin

34.2

18.0

Payments to govt.

441,919

189,655

Est. markup

182.7

Estimated capital

50,000

25,000

148.9

Source: Based on figures from Svedeniya, iii. 85–93, 116–17. These figures do not include the two capitals so they cannot be used to estimate totals for Gt. Russia as a whole.

(p.403)
Appendix 2 Accounts

Fig. 13.4(a) Income of an ‘average’ provincial tax farm: Great Russian provinces 1859

(b) Expenses of an ‘average’ provincial tax farm: Great Russian provinces 1859

(p.404)
Appendix 2 Accounts

Fig. 13.5(a) Income of an ‘average’ district tax farm: Great Russian provinces 1859

(b) Expenses of a ‘average’ district tax farm: Great Russian provinces 1859

(p.405)

Account 5

Table 13.7. Accounts of a large tax farm in Gt. Russia, 1857–1858

(a) Income account

Rubles

% of total income

From sales of vodka

Quota of 50,000 buckets

In towns

1,000 ‘polugar’ at 3.00

3,000

1.0

10,000 ‘table’ at 5.00

50,000

16.2

10,000 ‘special’ at 7.00

70,000

22.6

In rural areas

15,000 ‘improved’ at 4.50

67,500

21.8

10,000 ‘special’ at 6.00

60,000

19.4

Vodkas: 4,000 at 9.00

36,000

11.6

Vodka ‘economized’ by adulteration and cheating distiller

6,500 buckets sold at 3.00

19,500

16.3

TOTAL FROM SALES OF VODKA

306,000

98.9

From excises, fines, etc.

3,500

1.1

TOTAL INCOME

309,500

100.0

(b) Expense account

Rubles

% of gross expense

Cost of vodka

150,000

65.7

Excise payments to govt.

20,000

8.8

TOTAL PAYMENTS TO GOVT.

170,000

74.5

Running costs

Wages, rent, transport, bribes

30,000

13.1

Depreciation on est. 50,000 cap. over 2 years

25,000

11.0

Interest on sureties: estimate of 6% on ⅓ Of 150,000 & ⅕ of 20,000

3,240

1.4

DEPRECIATION + INTEREST

28,240

12.4

GROSS EXPENDITURE

228,240

100.0

(c) General accounts

Rubles

%

Total income

309,000

Gross expenditure

228,240

Net profit

81,260

Profit margin

26.3

Markup (tot. inc./payment to govt.)

182.1

Source: Based on figures in Moskovskie vedomosti (1859), no. 144, 19 June.

(p.406)
Appendix 2 Accounts

Fig. 13.6(a) Income of a ‘large tax farm’: Great Russian provinces 1857–1858 (b) Expenses of a ‘large tax farm’: Great Russian provinces 1857–1858

(p.407)

Account 6

Table 13.8. Accounts of a district tax farm in Novgorod province, 1856

(a) Income account

Rubles

% of total income

From sales of vodkaa

1,374 buck, ‘polugar’ at 3.00

4,125

3.1

18,225 ‘trekhprobnoe’ at 4.00

72,900

54.2

8,400 ‘sweetened’ at 6.00

50,400

37.4

TOTAL VALUE OF SALES

127,425b

94.7

From excise articles

7,175

5.3

TOTAL INCOME

134,600

100.0

(b) Expense account

Rubles

% of gross expense

On vodka

For quota of vodka at 2.98/bucket

50,984

47.8

Above quota at 0.60/bucket

4,142

3.9

Excise payments to govt.

18,000

16.9

TOTAL PAYMENTS TO GOVT.

73,126

68.6

Running costs

Wages

6,160

5.8

Tavernkeepers at 30 k./bucket sold

8,400

7.9

Rents

2,000

1.9

Initial costs (1,000/2 years)

500

0.5

‘Gifts to officials’

2,500

2.3

Heating, lighting, etc.

1,500

1.4

TOTAL RUNNING COSTS

21,060

19.7

Depreciation on 25,000 working capital over 2 years

12,500

11.7

Interest payments

n/a

n/a

Gross expenditure

106,686

100.0

(c) General accounts

Rubles

%

Total income

134,600

Gross expenditure

106,686

Net profit

27,914

Profit margin

20.74

Markup

184.07

Note: Govt, payments = 54 per cent of total turnover. In 1856, the government's total revenues from the Gt. Russian provinces were 82.19 million rubles. Assuming that this was 54 per cent of total turnover suggests a turnover of 152.2 million rubles for the Gt. Russian provinces in that year.

(a) Made up from agreed quota: 17,126; above quota purchases: 6,904; in addition, 2,403 buckets (10 per cent) generated through adulteration, and 2,403 (10 per cent) through undermeasuring, making a total of 28,836 buckets, of which 836 were given in gifts to officials.

(b) i.e. average price to consumers is 4.55 rubles/bucket.

Source: Based on figures in Kittara, Publichnyi kurs, 57–9.

(p.408)
Appendix 2 Accounts

Fig. 13.7(a) Income of a district tax farm: Great Russian provinces 1856 (b) Expenses of a district tax farm: Great Russian provinces 1856

(p.409)

Account 7

Table 13.9. Georg—profits of Gt. Russian tax farms, 1851–1854

Rubles

%

(a) Income

From vodka

Av. price/bucket = 5.35 × 15,457,850 buckets

82,699,500

88.01

+ 10% adulteration

8,269,950

8.80

From excises

3,000,000

3.19

TOTAL INCOME

93,969,450

100.00

(b) Expenditure

Cost of vodka at c.3.04

47,266,640

62.98

Taxes paid to govt.

12,785,430

17.04

Total paid to govt.

60,052,070

80.01

Wages, interest, etc.

10,000,000

13.32

Depreciation on capital of 20,000

5,000,000

6.66

TOTAL EXPENDITURE

75,052,070

100.0

(c) General accounts

Total income

93,969,450

Gross expenditure

75,052,070

Net profit

18,917,380

Profit margin

20.13

Payments to govt.

60,052,070

Est. markup

156.48

Est. capital

20,000,000

Source: Georg, ‘Vzglyad’, 121–2.

(p.410)
Appendix 2 Accounts

Fig. 13.8(a) Income of Great Russian tax farms 1851–1855 (b) Expenses of Great Russian tax farms 1851–1855

(p.411) (D) Government accounts, 1847–1859

Account 8

Table 13.10. Government accounts, 1847–1850

Rubles

(a) Income

Vodka sales

15,700,000 buckets sold for

46,021,240a

Excises

6,184,720

TOTAL INCOME

52,205,960

(b) Expenditure

Cost price of vodka at 80k./bucket

12,560,000

(c) General account

Gross income

52,205,960

Expenditure

12,560,000

Net income

39,645,960

(a) After 12 per cent commission; sold for 2.93 rubles/bucket.

Table 13.11. Government accounts, 1851–1854

Rubles

(a) Income

Vodka sales 15,891,440 buckets sold for

47,266,640a

Excises

12,052,070

TOTAL INCOME

60,052,070

(b) Expenditure

Cost price of vodka at 80 k./bucket

12,713,150

(c) General account

Gross income

60,052,070

Expenditure

12,713,150

Net income

47,338,920

(a) After 12 per cent commission; sold for 2.97 rubles/bucket.

(p.412)

Table 13.12. Government accounts, 1855–1856

Rubles

(a) Income

Vodka sales 15,781,190 buckets sold for

47,017,200a

Excises

11,960,700

TOTAL INCOME

58,977,900

(b) Expenditure

Cost price of vodka at 80 k./bucket

12,624,950

(c) General account

Gross income

58,977,900

Expenditure

12,624,950

Net income

46,352,950

(a) After 12 per cent commission; sold for 2.98 rubles/bucket.

Table 13.13. Government accounts, 1857–1858

Rubles

(a) Income

Vodka sales 15,781,190 buckets sold for

47,017,200a

Excises

17,625,000

TOTAL INCOME

64,642,200

(b) Expenditure

Cost price of vodka at 80 k./bucket

12,624,950

(c) General account

Gross income

64,642,200

Expenditure

12,624,950

Net income

52,017,250

(a) After 12 per cent commission; sold for 2.98 rubles/bucket.

Source: (Tables 13.1013.13): Georg, ‘Vzglyad’, 119–20.

(E) Distillers' accounts

Account 9

These are calculated using figures from Leskov, and elsewhere, which calculate income and costs per bucket. I have multiplied out to get an estimate of total costs. Details, of course, cannot be relied on. But the figures do give an indication of the relative importance of different types of costs. The ‘average’ Penza distillery is, of course, fictional. Even within the province, distilleries varied greatly in size. The largest claimed a capacity of almost 800,000 buckets a year, (p.413) although their real output was at most 250,000.10 While the smallest claimed a capacity of less than 20,000 buckets, and its real output was doubtless considerably lower.11

Basic measures: 70 distilleries producing, altogether, 2,174,520 buckets in 1860 imply an average output of 31,065 buckets. Leskov assumes a distilling year of 100 days, so this implies an average daily output of just over 310 buckets.12 I have assumed that the average cost of a distillery was about 20,000 rubles.

Table 13.14. Accounts of an average Penza distillery, 1860

Per bucket (kopecks)

Total (rubles)

As % of income

(a) Income

Receipts, 1860

82.00

25,472.95

100

(b) Expenditure

Raw materials

Grain

43.75

13,590.75

55

Firewood

1.50

465.97

2

Milling of grain

1.50

465.97

2

Labour costs

Wages of workers

1.50

465.97

2

Wage of distiller

1.50

465.97

2

Overheads

Cost of barrels

5.00

1,533.23

6

Contract expenses

1.00

310.65

1

Lighting, housing

0.50

155.32

1

Insurance and repairs

0.50

155.32

1

Miscellaneous

2.00

621.29

3

Transportation

Losses in transport

4.50

1,397.91

6

Transport to wharves

0.75

232.98

1

Transport onward

12.00

3,727.75

15

Depreciation on distillery

over 20 years

3.22

1,000.00

4

GROSS EXPENSE

79.22

24,609.08

101

(c) General accounts

Total income

82.00

25,472.95

Total expense

79.22

24,609.08

Net profit

2.78

863.87

Note: Profit margin is 3.39 per cent.

Source: Leskov, ‘Ocherki’, 429–32; Kittara, ‘Publichny kurs’, 73; Svedeniya, iv. 279.

(p.414)
Appendix 2 Accounts

Fig. 13.9 Costs of an ‘average’ distillery, Penza province 1860

Some conclusions suggested by accounts

  1. 1. Size and allocation of total turnover. Total turnover according to Acct. (1) = 145 million, of which distillers receive 10 per cent (14 mill.), the government 51 per cent (74 mill.), and tax farmers 39 per cent (56 mill.). Other estimates of total turnover of Gt. Russian tax farm: (3) gives 124 million, (7) 94 million for the 1851–5 period; (6) seems to imply about 152 million for 1855–6 if one can project the markup of 184 per cent on govt, revenue to the whole of Russia.

    Tax farm markup, i.e. total turnover as per cent of gross receipts of govt: (1) 164 per cent; (3) 136 per cent; (4) 183 per cent and 149 per cent; (5) 182 per cent; (6) 184 per cent; (7) 156 per cent.

  2. 2. Profits. The government's own costs were very small, mainly confined to paying for vodka. Its ‘profit margin’ was therefore extremely high. Acct. (3) gives 15 per cent for tax farmers' margin; acct. (4) 34 per cent; acct. (5) 26 per cent; acct. (6) 21 per cent; acct. (7) 20 per cent. i.e. all except (4) give tax farm profits of between 15 and 26 per cent. In absolute terms, net tax farm profits totalled 18.9 mill, in 1859 (3), and 18.9 in 1851–5 (7), while Kokorev, ‘Ob Otkupakh’, p. 26, gave 20 million for 1858. Distillers' profits seem to have been smallest of all: (9) gives 4 per cent as the profit margin for Penza distillers, which, projected on to all distillers implies a total net profit of 4 per cent of 14 million, or about 500,000 rubles.

  3. 3. Return on Capital. This is a much rougher calculation as most estimates of tax farm capital are estimates, not distinguishing between borrowed and owned capital. Estimated return varies from 552 or 206 per cent (3); to 143 or 163 per cent (5); to 112 per cent (6); to 95 per cent (7).

  4. (p.415) 4. Tax farm Incomes,

    1. i. Liquor sales as per cent of total tax farm income: (3) = 96 per cent; (4) = 96 per cent; (5) = 99 per cent; (6) = 94 per cent; (7) = 97 per cent.

    2. ii. Excises as per cent of total revenues: (3) = 3 per cent; (4) = 3.5 per cent; (5) = 1.2 per cent; (6) = 5 per cent; (7) = 3 per cent.

    3. iii. Illegal revenues derived from adulteration, undermeasuring, and cheating of distillers: (1) = 13 per cent; (3) & (4) = 7 per cent (both assume only 10 per cent adulteration); (5) = 3.3 per cent or 6.3 per cent, but only because ‘economized’ liquor was sold cheaply; as an addition to total sales, economized liquor = 13 per cent; (6) = 20 per cent; (7) = 10 per cent.

  5. 5. Expenditure.

    1. i. Total running costs as per cent of expenditure: (3) = 12 per cent; (4) = 14 per cent; (5) = 13 per cent; (6) = 19 per cent; (7) = 13 per cent.

    2. ii. Cost of vodka as per cent of expenditure: (3) = 49 per cent; (4) = 47 per cent and 45 per cent; (5) = 66 per cent; (6) = 51 per cent; (7) = 63 per cent.

    3. iii. Payments to govt, as per cent of expenditure: (3) = 87 per cent; (4) = 83 per cent and 82 per cent; (5) = 75 per cent; (6) = 69 per cent; (7) = 80 per cent.

    4. iv. Bribes as per cent of expenditure: (3) = 1.7 percent; (4) = 2.4 per cent and 1.6 per cent; (6) = 2.3 per cent.

    5. v. Wages as per cent of expenditure: (3) = 7.2 per cent; (4) = 6.6 per cent and 8.7 per cent; (6) = 5.8 per cent + 7.9 per cent to tavernkeepers.

Notes:

(1) Svedeniya, iv. 214.

(2) Korsak, ‘O vinokurenii’, 373–4; Koshelev claims that the tax farmers' obligation to watch over distilleries gave them good opportunities to buy vodka illegally directly from distillers. Svedeniya, iii. 255.

(3) For some estimates of the extent of adulteration, see Chs. 4 and 5.

(4) Korsak, ‘O vinokurenii’, 375.

(5) Svedeniya, iv. 453–4.

(6) Korsak, ‘O vinokurenii’, 353.

(7) This is the estimate adopted by Korsak, ‘O vinokurenii’, 353.

(8) Moskovskie vedomosti (1859), no. 160, 8 July.

(9) Trudy, i. no. 12: 12–13.

(10) Leskov, ‘Ocherki’, 422.

(11) Svedeniya, iv. 290–1.

(12) Leskov, ‘Ocherki’, 423.