Chongzhen revived the Ming Dynasty

Having successfully gained the support of the Grand Secretary, Zhang Pu's views were further promoted by the imperial court.

The various measures he had previously implemented in the Suzhou-Songjiang New Area and the arsenal were transformed into imperial policies and piloted in places such as Beizhili.

The most significant impact came from taxing business owners and requiring them to serve in the military:
"His Majesty once said that paying taxes and serving in the military are the two major obligations of citizens, and all citizens must bear this responsibility, otherwise they are not citizens."

"In the past, the Ming Dynasty's taxes mainly came from land taxes, but in the future, taxes will also be levied on industry and commerce."

Zhang Pu mentioned this point during a discussion on finance.

This is the current emperor's consistent attitude; he says it almost every year and every month.

The courtiers had already heard the argument and accepted the emperor's viewpoint.

This rule is now enshrined in the code of conduct, and tax evasion and refusal to serve in the military are considered absolute taboos.

The reason why the gift-giving scandal that broke out before Han Kuang became the chief minister was so influential was because it involved tax evasion.

Han Kuang, still shaken by this experience, fully supported this point and asked Zhang Pu:

"His Majesty has already arranged for the taxation of industry and commerce, and it is being piloted in places such as the Suzhou-Songjiang New Area."

"Tianru, do you have some insightful opinion on this?"

Zhang Pu said with a smile:

"Taxation has been arranged, but the rules regarding military service have not been finalized."

"Has Han Gong ever considered how to get industrialists and businessmen to serve in the military?"

This is a very difficult task. If all industrialists and businessmen are conscripted for corvée labor, the market will become deserted.

Moreover, these people are not as good at working as farmers, and they are not easy to manage.

After some discussion, Han Kuang tried to speak:

“It’s not acceptable to perform corvée labor like farmers.”

"Since merchants and industrialists are making money, why not make them pay exemption fees, all of which should be converted into silver?"

Zhang Pu smiled without saying a word, clearly disagreeing.

Cheng Jiming, sitting next to Han Kuang, said:
"Tianru, stop keeping me in suspense and tell me your plan?"

Zhang Pu then said:

"Who do you think is the primary target of the Emperor's taxation of industry and commerce?"

After careful consideration, some of the people present understood. Han Kuang squinted, stroked his beard thoughtfully, and said:
"Does Tianru mean to levy taxes on businesses and require them to perform military service?"

Zhang Pu nodded upon hearing this, and said confidently:
"exactly!"

"Taxes should be levied on businesses, and the same should apply to corvée labor."

"In the legal concept proposed by the Emperor, the enterprise organization is called a legal person."

"People have rights and obligations, and so do legal persons."

"Therefore, legal entities should bear corresponding corvée labor just like individuals."

Upon hearing this, everyone's horizons were immediately broadened:

Since taxation can target corporations as legal entities, the same principle applies to conscripting laborers.

Businessmen and industrialists will no longer be able to escape corvée labor; everyone will have to serve.

Thinking that the possibility of requisitioning unpaid labor from enterprises would further alleviate the financial situation of the Ming Dynasty, Bi Ziyan said with a smile:

"Tianru is truly a great talent; no wonder the Emperor values ​​you so highly."

"The practice of conscripting labor for legal entities is indeed worth discussing and should be decided when the rites and music are re-established."

Zhang Pu smiled, cupped his hands in greeting, and said:

"It should indeed be discussed carefully; conscripting laborers from legal entities is not so easy."

“If we make them work for free, these companies may go bankrupt in the long run.”

"After racking my brains and talking with Mr. Liu, I realized that instead of making them work for free, it would be better to stipulate that a portion of the goods produced by this enterprise must be sold to the supply and marketing group at a fair price, following the wartime system."

"In this way, the imperial court can benefit from the sales by the supply and marketing group. If the imperial court needs supplies, it can also requisition them."

This was his proposed solution: to conscript laborers from businesses while ensuring their survival.

We cannot bankrupt those enterprises by conscripting laborers, as that would damage the tax base.

Some officials find it troublesome because they think it would be better to simply have these companies do their work for free or charge them a fee.

In response, Zhang Pu said:

"If you ask companies to do their work for free, they may not be dedicated enough, or they may even go bankrupt due to a lack of working capital."

"Converting it into silver is essentially taxation, which increases tax revenue rather than utilizing the productivity of these enterprises."

“Taking a portion of the goods from enterprises at a fair price can not only sustain their survival but also utilize their productivity, allowing the imperial court to control more goods.”

"Once the imperial court has control over these goods and supplies, it can allocate them directly as needed, saving money on procurement."

These words resonated with some people because in this era of underdeveloped commodity economy, money is not actually that important; sometimes, even with money, you can't buy goods.

The thought of being able to purchase clothing from garment factories and canned goods from canneries at affordable prices and have them directly allocated to them was very appealing to them.

In particular, the government's issuance of ration coupons after converting salaries into silver inspired these officials. They felt that the government could issue ration coupons for goods after collecting taxes, which would increase officials' benefits.

They whispered and discussed for a long time, and most of them agreed to conscript laborers by purchasing goods at low prices.

However, Han Kuang was still somewhat hesitant because doing so seemed to be exploiting the company.

Zhang Pu advised him:

"Corvée labor for mines can be the collection of ore, and corvée labor for coal mines can be the collection of coal."

"These ores and coals are allocated to steel companies and can be smelted into steel products."

"This forms a complete chain, and the imperial court only needs to pay for the smelting cost to obtain the steel for manufacturing firearms."

“This process involves numerous enterprises and cannot be handled by anyone other than the Planning and Development Commission.”

"Han Gongke can set up a special planned economy group to allocate corvée labor materials."

This was clearly pointing out a way for Han Kuang to make a name for himself. As long as he provided the steel, his name would definitely be on the list of those who made contributions to equipment production and were rewarded in the future.

Moreover, steel is used for more than just manufacturing firearms; it is also needed for building fortifications, bridges, roads, and houses.

The emperor's prophecy of the steel age is becoming a reality; steel is now needed in many places.

As long as Han Kuang controls the steel industry, no one can ignore his influence. Similarly, this method can also be used to control many other resources. This made Han Kuang sigh involuntarily:

"Tianru is truly a great talent!"

"It involves allocating resources to produce goods, which requires skilled personnel."

"I plan to establish a planning economy group within the State Planning Commission to be specifically responsible for this matter."

"Tianru is familiar with industry; would you be willing to take on this task?"

This means he is to be appointed as the head of the planned economy group. Upon hearing this, Zhang Pu was delighted and said:

"Gentleman Han has shown me such kindness; how could I, Zhang, dare to refuse?"

"We are willing to dedicate the entire Academy of Sciences to supporting the development of this plan."

They immediately proposed conscripting laborers from the steel, food, and textile industries, and concentrating them in industrial parks.
"An industrial park can bring together the entire industrial chain of an industry, transforming raw materials into commodities."

"In this way, when the imperial court conscripts laborers, it can directly convert the collected raw materials into corresponding commodities."

"Whether it's levying taxes or conscripting labor, it's much simpler and more convenient."

"Steel, food, and textiles—these are the supplies needed by the military—can be prioritized for conscription as a pilot program."

These were all things the army needed, catering to Han Kuang's desire to make a name for himself in the Annam campaign.

He naturally agrees with establishing industrial parks and conscripting laborers, but will those companies actually move in obediently?
Zhang Pu responded with a smile:
"In order to attract companies to settle in, the industrial parks in the Suzhou-Songjiang New Area offer a five-year tax exemption."

"This promise cannot be broken, but it doesn't say anything about exemption from corvée labor. We can conscript them for labor, sell a portion of their goods at a fair price each year, or produce them at cost price for a period of time."

"This ratio and timing, according to the rules set by the Emperor, are determined by the local councils. We can invite those industrialists and merchants to discuss how to perform the service."

This allowed those serving to decide for themselves how they would serve, and everyone present laughed when they heard that.

It could be said that Zhang Pu's approach was somewhat despicable, not only forcing those industrialists and businessmen to serve in the military, but also making them discuss how to execute themselves.

As for whether these people would resist, no one cared. Because the power of merchants and industrialists in the Ming Dynasty was actually very small, if they dared to refuse to serve, the court would treat them as non-citizens.

Moreover, Zhang Pu said:

“The Suzhou-Songjiang New Area is suitable as a pilot area, and the business owners there will not object.”

"Because this kind of corvée labor is actually the result of the supply and marketing group purchasing goods at a fair price."

"Some companies want to supply goods to the supply and marketing group, but they can't even get the chance!"

This is indeed true. After the rapid development during the wartime period last year, the production scale of the Suzhou-Songjiang New Area expanded dramatically. As a result, some industries experienced overcapacity after the war suddenly ended.

That's why they're shouting for support of the war and hoping it will continue.

The supply and marketing group's procurement of materials in a manner similar to wartime conditions was extremely well-received, which is why Zhang Pu dared to propose using this method to conscript laborers.

He believed that businessmen would not oppose the policy and would even actively provide goods for corvée labor.

The supply and marketing group also needs more types of goods in order to expand its sales outlets.

Those who were previously not proactive in purchasing from the supply and marketing group were also required to provide goods under the corvée system.

There is a problem with this method, because the materials for conscripting laborers are actually purchased at a fair price, and the imperial court needs to prepare funds for this purchase.

The Ministry of Revenue had a sum of money from selling land in Liaodong, but it was unwilling to invest it.

This matter would be considered troublesome by others, but Zhang Pu was confident and said:
Are you all familiar with the vouchers issued by the supply and marketing group?

"These are securities issued with goods from the supply and marketing group as collateral, which can be used to purchase materials instead of gold and silver."

"We can work around this now. We can print the vouchers a few months in advance, specifying the usage period, and then purchase enough corvée supplies before the start date."

"When these vouchers are available, we can use them to sell the supplies and recycle the vouchers that have been issued."

"The difference between the price and the price is the middleman's profit. The imperial court can share the profits with the supply and marketing group, or obtain materials that can be stored for a long time as reserves."

This method allowed the imperial court to obtain resources and money without incurring any costs, which greatly interested the Ministry of Revenue.

At this time, the Ming Dynasty was experiencing a currency shortage. All the gold and silver in the Ming Dynasty could not meet the market demand.

The exchange rate of silver to copper coins has risen from the previously officially set rate of 650 coins per tael of silver, to over 1100 coins after the opening of the metal exchange, and now to over 1300 coins—all reflecting this point.

Spain's involvement in European wars reduced the amount of silver transported to the Ming Dynasty, exacerbating this situation.

The high price of silver and low price of copper coins brought about a series of problems. In order to avoid the chaos caused by rampant inflation and to prevent farmers from being exploited when paying taxes in silver, the imperial court has stipulated that the silver-for-tax system of the Single Whip Law be changed to allowing farmers to pay taxes in silver or grain at their own discretion.

However, grain has a shelf life, and so do other goods. What the Ministry of Revenue most desired was to convert them all into currency.

As a form of token, vouchers naturally came to the attention of the Ministry of Revenue. Bi Ziyan recognized the value of this token and hoped it could serve as a supplementary currency.

The thought flashed through his mind, and Bi Ziyan said:
"Can vouchers guarantee stability? Can the supply and marketing group provide the corresponding supplies?"

"If possible, the Ministry of Revenue could allow tax payments to be made using vouchers, which would make businesses more receptive to vouchers."

This suggestion delighted Zhang Pu.

The biggest risk of his proposed method is that industrialists and merchants might not accept the pre-issued vouchers. Or, due to distrust of the vouchers, they might stage a run on the supply and marketing cooperatives, demanding the redemption of goods.

That would be a disaster for vouchers. They would collapse like paper money and be quickly abandoned.

But that risk is no longer present.

As long as the Ministry of Revenue is willing to accept vouchers, people don't need to rush to redeem them for goods, since they can spend them when paying taxes anyway.

Vouchers will become more tangible and closer to real currency.

Therefore, he repeatedly thanked Bi Ziyan and made a promise:

"Both the Supply and Marketing Group and Sihai Bank will maintain the stability of the vouchers."

"If the value of the vouchers fluctuates by more than 10%, measures will be taken. And if the fluctuation exceeds 20%, assistance will be sought from major banks and the Financial Reserve Council to ensure that the fluctuation range is kept within 30%."

"If the Ministry of Revenue is willing to provide assistance, it can also allocate Taicang supplies to exchange for cash vouchers."

"As long as the vouchers don't collapse, the supply and marketing group will definitely be able to redeem the vouchers collected by the Ministry of Revenue."

This guarantee convinced Bi Ziyan to accept tax payments in vouchers so that he could eventually be free from the restrictions of gold and silver and reduce the collection of in-kind taxes.

Cooperation with the supply and marketing cooperative would also be beneficial in this regard. This group, which specializes in the procurement and sale of materials, would have a very strong capacity to process physical goods. Goods that are difficult to preserve and are collected by the imperial court can be sold through the supply and marketing cooperative.

However, allowing taxation through vouchers would have far-reaching implications. To avoid the immense losses from such a failure, Bi Ziyan, following the example of the current emperor, decided to conduct a pilot program in certain regions.

The pilot area is, of course, the Suzhou-Songjiang New Area.

First, the supply and marketing group was first established here; second, the new district is new in all aspects, which facilitates the transformation of policies.

Soon, under the leadership of Han Kuang and Bi Ziyan, the Cabinet's Planning and Development Committee and Finance and Economics Committee, together with the Ministry of Revenue and the Ministry of Works, issued a document to the Suzhou-Songjiang New Area to pilot the collection of corvée labor and the acceptance of tax vouchers. (End of this chapter)