Farming, Taxation and Trade in Tang China

From 618 to 907, Tang China’s economy depended on farming households, the taxes and labour they owed, and trade linking inland regions with distant markets. The dynasty’s rule was formally interrupted by the Wu Zhou regime from 690 to 705, and its control of frontier territories changed over time. Economic arrangements also shifted: early Tang governments tied taxation closely to registered people and land allocations, while later rulers had to reckon with land concentration, displaced households and diminished central authority.

Most people lived in rural areas, but agriculture supported cities, government offices and armies as well as trade. The northern regions relied increasingly on wheat, while rice was especially important in the south and also became more common further north. The Grand Canal helped move grain and other goods between regions.

On this page5 sections

Land, farming and household obligations

Early Tang rulers renewed the equal-field system, a set of rules for allocating land to registered households. Its purpose was to keep land under cultivation, sustain farming families and give the state a dependable population from which to collect taxes. The system distinguished between land intended for a cultivator’s use during life and land that could be inherited. Hereditary holdings were often associated with growing mulberry trees for silk production, while other allotted fields were expected to return to the state when the holder died.

These provisions did not mean that all land was divided equally or that the government owned every field. Allocations depended on rules about household members and local circumstances; densely populated districts could not always supply the stated amounts. Some land was privately held, and officials and other people of status could possess additional land under separate arrangements. Land sales and the growth of large estates also weakened the system’s aim of sustaining a broad body of small cultivators.

Registration connected land, taxation and labour. Officials used household records to identify taxpayers and, under early Tang arrangements, to determine obligations associated with adult men. The zu-yong-diao system combined a grain levy (zu), a payment in cloth or related goods (diao), and labour service (yong). A commonly stated schedule required grain, silk cloth and about 20 days of service, though rates and substitutes varied by region. Where service was commuted, a household could provide goods instead of labour.

Farming obligations also had a military dimension. Under the fubing militia system, some farmers served in rotation and supplied provisions and equipment. This arrangement changed as frontier warfare and the demands of military service evolved. In 737, Emperor Xuanzong expanded long-service frontier recruitment, reducing reliance on rotating farmers for distant garrison duties.

Why the early tax system changed

The zu-yong-diao system assumed that registered taxpayers farmed relatively small holdings and could meet standard obligations from their own production. That assumption became harder to sustain as land passed into larger estates and some independent cultivators lost their farms. Displaced people might settle elsewhere without appearing correctly in the records used for taxation. Others worked as tenants on the land of powerful households or Buddhist monasteries. Such households could be difficult for the central government to assess and tax through a system based on registered people and standard per-person dues.

The An Lushan rebellion of 755–763 and the disorder that followed further damaged the government’s ability to maintain records and collect taxes across the empire. Regional military governors, known as jiedushi, acquired greater power, while central revenues and registered taxpayers declined. Earlier levies based on people and household status no longer matched the distribution of land and wealth. Other taxes and local charges had accumulated, making collection more complicated.

In 780, under Emperor Dezong, the government adopted the two-tax system proposed by Chancellor Yang Yan. Instead of relying on the earlier combination of standard grain, cloth and labour obligations, it assessed a land tax and a household tax. The land tax was paid in grain, with the amount related to the land’s fertility. The household tax reflected a household’s assessed wealth and was generally paid in coins; textiles could be accepted when currency was scarce. Households were placed in wealth categories to help determine the amount due.

Collections were organised twice a year, with the household tax due in summer and the land tax after the autumn harvest. The new system recognised differences in landholding and household resources rather than assuming a relatively equal holding for each taxpayer. It also ended general corvée service as a standard tax obligation, although governments could still demand labour in particular circumstances. Revenue was divided among central, regional and military administrations. In areas where military governors resisted central control, payments could be irregular or withheld, leaving the court increasingly reliant on revenue from the southeast and south.

Production, workshops and markets

Farm production supplied more than food. Mulberry cultivation supported silk production, while hemp and ramie could provide fibres for taxable textiles. These goods linked rural work to household dues and to markets. Production also included ceramics and lacquerware, which circulated within China and were traded abroad. A cargo of Tang ceramics recovered from a shipwreck in Southeast Asian waters illustrates the scale of overseas movement, though such finds represent particular voyages rather than the whole trade.

State projects and private customers both employed skilled makers. Xuanzong’s records list tens of thousands of craftsmen registered for government service, including palace building. Workshops turned clay into vessels, fibres into cloth and wood into furnishings or building parts. These products could meet official demands or enter markets at home and abroad.

Urban markets brought together food, manufactured goods and traders. Chang’an, the capital, had designated markets under government supervision, while other cities and regional centres served local and long-distance exchange. The state also exercised control over important commodities. Salt production and sales, for example, became a government monopoly administered through a powerful commission. Merchants could obtain rights to buy and distribute monopoly salt, carrying it to local markets. By 799, salt revenue reportedly accounted for more than half of the government’s income.

Trade became more important to public finance and private livelihoods as cash use grew. The two-tax system made money particularly important for paying household dues, although payment in textiles remained possible where coins were scarce. After the mid-eighth-century rebellion, the central government’s reduced capacity to direct economic life also coincided with the opening of more markets to commerce. This did not mean that trade was free of regulation: the salt monopoly and the administration of urban markets show that state control continued in specific areas.

Canals, frontier routes and maritime trade

Within the empire, waterways and roads moved agricultural produce and commercial goods between producing regions and cities. The Grand Canal was especially important for transporting grain from the south towards northern centres and the capital. Yangzhou, positioned on this system and near the Yangtze, became a major commercial hub and a staging point for goods arriving from abroad. Guangzhou, on the southern coast, was a leading port for maritime exchange.

Overland commerce depended in part on Tang control of routes through the northwest and Central Asian corridors. This control was not continuous. Frontier conflict and shifting authority affected access, and after the An Lushan rebellion the Tang withdrew troops from western territories, weakening direct connections along the Silk Road. The court later recovered some northwestern territory, but the routes remained shaped by changing political and military conditions rather than by a fixed imperial boundary.

Sea routes connected southern Chinese ports with Southeast Asia, India and regions further west. Foreign merchants lived and worked in Chinese cities, and ships arriving at Guangzhou brought goods such as spices, pearls and jade. Chinese products, including ceramics and silk, travelled in the other direction. These maritime networks complemented the inland canal system: goods arriving at a coastal port could move onward through river and canal transport, while products from inland workshops and farms could reach overseas buyers.

Changing arrangements in the later Tang

The contrast between early and later Tang arrangements was not a simple transition from farming to commerce. Agriculture remained essential, but the institutions that linked cultivators to the state changed. The equal-field rules became increasingly difficult to apply as land became scarcer in some regions, estates expanded and households moved beyond the reach of official registers. By the end of the Wu Zhou period, the system was already badly weakened. The 780 tax reform displaced its role as the practical basis of taxation, even as older land rules continued to exist formally.

For the wider setting, see Tang China: History, Government and Society.