Land Revenue

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Under Shivaji, the revenue system appears to have been closely patterned on the system devised by Malik Ambar, with a fresh revenue assessment completed by Annaji Datto in 1679.
Shivaji also kept a close watch over the mirasdars — those holding hereditary rights in land.
- Sabhasad, writing in the 18th century, records that this class typically remitted only a small portion of their actual collections to the government: “In consequence, the mirasdars grew and strengthened themselves by building bastions, castles, and strongholds in the villages, enlisting footmen and musketeers… this class became unruly and seized the country.”
- Shivaji responded decisively — destroying their bastions and forcing them into submission.

Mokasa, Jagir, and Saranjams

Within Maratha territory, the terms mokasa, jagir, and saranjam were often used interchangeably, though jagirs tended to be somewhat more permanent in nature than mokasas.
- These were fundamentally military tenures — theoretically temporary, transferable, and liable to confiscation — yet, in practice, they steadily assumed a hereditary character over time.
- Officials were largely compensated through the grant of mokasas or jagirs in lieu of direct salary. Notably, the Maratha system also permitted the sub-letting of mokasas — a practice entirely absent from the revenue systems of north India.
- Saranjams were further divided into jat and fauj components — a structure paralleling the Mughal zat and sawar ranks — with jat denoting personal pay, and fauj covering the maintenance of troops.
  - Notably, the revenue actually assigned to these mokasadars was calculated only after deducting sardeshmukhi, chauth, and batai.
Shivaji himself discontinued the practice of granting mokasas or saranjams, preferring instead to pay his officials directly in cash.
- Soon after his death, however, his son Rajaram revived the practice of granting mokasas.
- There subsequently emerged a clear tendency among mokasa holders to convert their grants into inam or watan tenure, thereby rendering them fully hereditary.
  - A. R. Kulkarni characterises this tendency to convert mokasas into hereditary tenures as distinctly “feudal” in nature.

Inam Lands

Inam lands were revenue-free assignments made to the pious, the needy, and scholars — the specific terminology varied by region, though the underlying nature and pattern of distribution remained broadly uniform across Maratha territory.
- Watan and inam were generally used as synonyms in Maharashtra, differing chiefly in that watan grants carried no attached service obligation.
- Watan tenures were largely held by village officials — the village headman (patil/muqaddam), the village accountant (kulkarni), the patil’s assistant (chaugula), the village market officer (shete-mahajan), and the village watchman (mahar) — as well as by temples and priests.
  - These tenures were, in principle, hereditary and permanent only so long as the holder continued to perform his designated duty; in practice, however, they continued to be enjoyed by the same family in perpetuity, so long as its members carried out these responsibilities.
  - This was, in effect, a genuine service tenure. Interestingly, inam lands were not entirely tax-free — holders were still required to pay either one-third or one-fourth of the revenue collected to the state, depending on the specific nature of the inam tenure.
- Inams were of two principal types:
  - Diwan-nisbat inam, granted directly by the state through a formal sanad.
  - Gao-nisbat inam — also known as dehangi-inam — granted instead by the village community itself, typically to village artisans and servants.
As in earlier centuries, agriculture remained India’s principal industry through the 18th century, and land revenue accordingly formed the primary source of income for the Peshwas.
- While Shivaji had preferred taking a direct share of actual field produce, the Peshwas instead favoured granting land on long lease against a fixed state demand.
The practice of fixing state demand according to available irrigation facilities dated back as far as the era of Manu and Kautilya, though the classification of land by fertility and actual state of cultivation reflected clear Mughal influence.
- To encourage cultivators to bring more land under the plough, newly cultivated land was deliberately taxed at a lighter rate.
  - For bringing waste or rocky land under cultivation, Madhav Rao II announced that half of such land would be granted outright as inam, while the remaining half would receive rent-free concessions for 20 years, followed by a further period of reduced taxation for 5 additional years.
- In times of famine, drought, or the destruction of crops through plunder or crop failure, appropriate remissions of land revenue were granted.
- To protect cultivators from falling into the clutches of moneylenders, the state extended tagai (agricultural) loans at notably low rates of interest.
Neither the level of state demand nor the actual mode of payment of land revenue was uniform across the entire Maratha domain.
- The Maratha revenue system, on the whole, rested on a genuine principle of security for the taxpayer — an otherwise sound system that was later undermined by the mismanagement of Baji Rao II, who resorted to the practice of farming out revenue collection to the highest bidder.

Chauth and Sardeshmukhi

Chauth and sardeshmukhi served as the two principal instruments used by Shivaji, and by subsequent Maratha rulers, to extract wealth from invaded enemy territories — generally levied in the neighbouring domains of the Mughal Empire or the Deccan Sultanates.

Chauth

Chauth has a long history predating Shivaji himself: the Koli Rajas of Ramnagar (in the Konkan) had already been collecting chauth from the Portuguese well before Shivaji introduced the levy — so much so that the Portuguese themselves referred to these Koli rulers as “chauthia Rajas.”
- Shivaji’s first recorded demand for chauth came after his conquest of the Kolis of Ramnagar, when he claimed the same chauth previously paid to the Kolis from the Portuguese themselves — a demand the Portuguese resented, leading to a protracted tussle over the issue, with payments frequently delayed or made only in part.
- Over time, the Marathas extended this levy on a regular basis, even to Mughal territories over which they held only an indirect claim or influence.
Shivaji demanded from the subjects of his enemies a tribute roughly equivalent to one-fourth of a province’s estimated revenue, in exchange for sparing them the harassment of his invading armies — often capturing wealthy individuals from enemy territory and compelling their agreement to such ransom terms.
- Shivaji’s own income from chauth alone has been roughly estimated at approximately 90 lakh hons.

Sardeshmukhi

Sardeshmukhi was imposed by Shivaji within his own dominion (swaraj), on the basis of his personal claim to be the hereditary sardeshmukh — the head-man of all Maharashtra.
- Unlike chauth, sardeshmukhi was thus claimed by Shivaji as a matter of right, resting on the contention that, as hereditary sardeshmukh, he was entitled to compensation for safeguarding the welfare of his subjects.
  - This justification was, in practice, largely a convenient fiction — the tax was collected across all territories that already paid chauth. Chauth and sardeshmukhi, however, should not be confused with mere spoils of war.
- Sardeshmukhi was fixed at 10 per cent of total revenue realised, and was assessed alongside the jamabandi (revenue settlement).
  - Sabhasad (Krishnaji Anant) estimated Shivaji’s income from sardeshmukhi alone at approximately 1 crore hons.

The Debate Over Chauth

Later, under the Peshwas, formal Mughal sanction was secured to collect chauth and sardeshmukhi across the six subahs of the Deccan, in exchange for which the Marathas agreed to furnish 15,000 horsemen in service of the Mughal government, along with a modest annual fee.
- This arrangement steadily drained the resources of the Marathas’ erstwhile enemies, allowing them to progressively extend their own territorial boundaries.
This particular fact leads the Maratha historian Ranade to argue that chauth was not merely a military contribution devoid of legal standing, but rather a genuine payment made in lieu of protection against invasion by a third power.
- He draws a direct comparison with Wellesley’s Subsidiary Alliance system, under which a native ruler who signed the subsidiary treaty was obliged to maintain a British force within his territory (and bear its cost), in exchange for the East India Company’s undertaking to protect him against both external invasion and internal rebellion.
- Under Shivaji’s system, while there was a tacit understanding that a chauth-paying territory would be protected from foreign aggression, the Maratha leadership never actually pursued this obligation to its logical conclusion, nor genuinely extended such protection to the concerned states.
  - In other words, British control under the subsidiary system was considerably more complete and exacting than anything achieved under the Maratha chauth arrangement.
Other historians take a notably different view.
- Sardesai holds that chauth was simply a tribute collected from hostile or conquered territories, nothing more.
- Surendranath Sen argues that chauth amounted to little more than a contribution exacted by a military leader, describing it candidly as a form of “blackmail” — one he considers justified given the exigencies of the time.
- Jadunath Sarkar contends that payment of chauth merely spared a territory from the unwelcome presence of Maratha soldiers and civil functionaries, without imposing on Shivaji any genuine corresponding obligation to defend that territory from foreign invasion or internal disorder.
  - In Sarkar’s reading, the Marathas were interested purely in immediate gain, with little concern for the fate of their “prey” once they had departed — chauth, in this sense, was simply a means of buying off one predator, not a genuine system for maintaining peace and order against all threats.
  - Territories subject to chauth cannot, therefore, be accurately described as Maratha “spheres of influence” in any meaningful sense.
- Taken together, chauth appears, for all practical purposes, to have functioned essentially as a military contribution — paid chiefly to ward off an immediate Maratha attack, and perhaps to discourage their future reappearance in a given territory.
Under Shahu and his successors, chiefs who independently raised men and money to enforce chauth and sardeshmukhi claims in distant territories could neither be reasonably expected to obey royal orders in full, nor to render a proper account of the funds they raised and spent.
- The principal reason for this drift was that the Maratha king himself showed comparatively little personal interest in these distant military operations.
V. G. Dighe and S. N. Qanungo further argue that, under the Peshwas, the operation of chauth and sardeshmukhi actively contributed to the very growth of feudalism that Shivaji himself had originally sought to curb.

Other Sources of Revenue

Beyond land revenue, the Maratha state also derived income from forests, customs and excise duties, and mints, among other sources.
- Permits were sold for cutting timber from state forests, and forest produce such as grass, bamboo, wood, and wild honey was similarly sold for state revenue.
- The state also issued licences for private mints to approved goldsmiths, who were, in turn, required to pay a royalty to the state.
A range of other, more specific taxes were also levied, including:
- A tax on land irrigated from wells.
- A house tax, recovered from everyone except Brahmans and village officials.
- An annual fee for the official testing of weights and measures.
- A tax on marriage, and specifically on the remarriage of widows.
- Taxes on sheep and she-buffaloes.
- A pasturage fee, and a tax on melon cultivation along river beds.
- A succession duty.
- A town duty.