<!-- generated: provider=openrouter model=arcee-ai/trinity-large-preview:free date=2026-02-19 source=book-5-chapter-02 -->

# Tax Farming

## Definition

The practice of leasing the right to collect taxes to private individuals or
companies for a fixed rent, who then profit from any amount they collect above
that rent, often leading to excessive and oppressive collection methods.

## Source Chapter

Book V, Chapter 2

## Context

Smith criticizes tax farming as an inefficient and oppressive method of
revenue collection that encourages corruption, excessive enforcement, and
the extraction of profits by farmers at the expense of the public.

## Economic Domain

General Theory

---
