Evolving Fiscal Foundations, c.1650–1730

This chapter examines how the exigencies of decades-long Habsburg rivalry with the Ottoman empire and France affected provincial revenue, fiscal practices, and flows of money. Special attention is paid to the interplay of innovative forms of taxation, new agreements between ruler and Estates known as “recesses” that fixed a minimum level of the diet’s annual grant over a number of years, and the increasing use of the Estates’ credit on the government’s behalf. In particular, it draws attention to the inherent and increasingly visible link between taxation and borrowing as manifested in the Estates’ financial intermediation. The profound change in the financial relations between government and Estates between the 1680s and 1710s helps explain Habsburg international staying power.