Taxation in the German Marshall Islands
by Dirk H.R. Spennemann
However, in view of the uncertainties surrounding the actual number of people on an atoll it was not possible to levy individual taxes. Given the complex pattern of land ownership and usufruct rights, this would have also been very impractical and possibly inequitable. Thus it was desirable to define tax collection districts and set tax targets for each of the districts.
Given the climatic conditions, the southern atolls were more productive and thus yielded more copra, which with a higher population , could also be harvested by more hands. Overall the data as represented in the available records and files are patchy, with the earlier annual reports providing more detail than later documents. The table below compiles the copra returns for the Marshall Islands for the period 1888 to 1898 arranged by taxation districts . The average annual return for the period was 4,138,598 pounds.
|Annual copra production (in pounds) per taxation district|
|Jaluit||Ebon||Ailinglaplap ||Namorik etc ||Mili||Majuro||Arno||North Ratak ||Mejit|
|Notes:  includes Kwajalein, Ujae, Lae and Lib;  Namorik, Wotho, Rongerik, Rongelap, Ailinginae, Bikini, Jabwat, Namu;  Aur, Maloelap, Wotje, Ailuk and Uterik.|
In 1886 the German Colonial administration levied an annual copra tax of 360,000 pounds on the whole of the Marshall Islands. The German administration used, where possible, traditional boundaries for the delineation of their tax districts. The irooj were ordered to collect the copra, and were given 1 / 3 of the collected tax. Making the irooj responsible for the collection of copra tax in their districts certainly enshrined the power of the named irooj, but also tied the chiefs to the German administration.
Taxation districts in the Marshall Islands and the annual tax levied |
(in English lb copra). Draft levy shown in italics
|Ailinglaplap, etc. 1)||27,500||Kabua||40,000||50,000||109,500|
|Namorik etc. 2)||27,500||Loiak||25,000||25,000||54,750|
|The eastern part of Majuro|
The western part of Majuro
|The eastern part of Arno|
The western part of Arno
|Maloelap, etc. 3)||22,500||Murjel||25,000||40,000||87,600|
|Notes: (1) includes Kwajalein, Ujae, Lae and Lib; (2) Namorik Wotho, Rongerik, Rongelap, Ailiginae, Bikini, Jabwat, Namu; (3) Aur, Maloelap, Wotje, Ailuk and Uterik.|
The German government put its priorities first and demanded that tax copra be cut before copra could be cut for personal needs. But even from the copra remaining the irooj took a share. On one occasion the German government had to intervene and direct irooj Kaibuki of Majuro that the irooj's share of copra was only to be cut from January to June and that the rest of the year the people could cut copra for themselves and sell it for their own profit.
The German payments to the chiefs resulted in the development of modern "custom." As determined by the Trust Territory courts, the irooj's copra-share was 6% and that of the alap and dri-jerbal combined 94% (Cf. case Loeak v. Bulele , 7 Trust Territory Reports, Page 504). In 1952 the copra share of the irooj on Arno Atoll was fixed to be ¢1 per pound, while the alap's share was ¢0.4 per pound, leaving, after deduction of shipping costs, only ¢1.4 per pound for the ri-jerbal.
In 1898 a comparative assessment of the copra tax return was carried out for the various districts. It was noted that the returns were uneven in percentage terms. Table 1-8 shows the tax burden for each atoll expressed as a percentage of its total copra production. To address these imbalances, the administration suggested a revaluation of the levy for a number of atolls, which occurred. While the total tax revenue was left unaltered the new rates mainly benefited Nauru where the tax was halved. A further reassessment for 1899, which also saw an increase in the overall tax burden, was not carried out.
|Copra tax levy expressed in % of annual copra production per taxation district|
|Jaluit||Ebon||Ailing-laplap 1||Namorik etc 2||Mili||Majuro||Arno||North Ratak 3||Mejit|
|Notes: (1) includes Kwajalein, Ujae, Namu, Lae and Lib; (2) Namorik and the rest of the Ralik Chain (3) Aur, Maloelap, Wotje, Ailuk and Uterik;|
In 1912 the taxation rate was reassessed once more. Again adjustments were made, most markedly the reduction in tax burden on Jaluit and Mili, with a dramatic rise in the tax burden on the central and northern atolls. This reflects the increased production in these areas.
While this was merely an adjustment to keep up with the changes in production, in the same year the German administration moved to dramatically change the taxation base of the Islands Territory of the Caroline, Palau and Mariana Islands. The new tax system was to be based on direct taxes on income and property as well as payment for government activities through stamp duty. The Vice-Governor in Pohnpei, Dr. Kersting, proposed a uniform head tax of RMk 20.00 which was opposed by the Station chief Merz who argued that the tax burden could reach up to 295% of the copra production of an atoll as in the case of Bikini. As Merz argued, these figures also did not include the irooj's share of copra. The table below sets out the actual tax burden in 1912, together with figures on the size of the taxable population and the current individual tax burden expressed in RMk. If Kersting's proposal had been implemented, the tax burden for most Marshallese would have risen between 30% and 60%. Beneficiaries would have been the residents of Ebon and Namorik, who would have seen a reduction in tax.
|Taxation rate per taxable individual 1912|
|Atoll||Copra Tax Levy (kg)||Percent of Production||Taxable Population||Percent of Population||lb per Person||Pers. tax (RMk)|
|Rest of Ralik 1||50,000||7.26||639||39.64||156.49||15.65|
|Rest of Ratak 2||40,000||6.12||507||36.79||157.79||15.78|
| Ailinglaplap, Kwajalein, Ujae, Namu, Lae, Lib, Ailinginae, Rongelap, Rongerik, Bikini, Wotho.  Maloelap, Wotje, Ailuk, Aur, Taka, Erikup and Uterik.  Calculated as average of the individual atoll results.-- NOTE the apparent differences between the tax levy in this table compared with table 1-7 is caused by the fact that in this table the figures are expressed in kg, while in table 1-7 the unit of measure is British pounds.|
Copra production data compiled from: Brandeis, Eugen (1892) Jahresbericht betreffend das Schutzgebiet der Marshall Inseln. Deutsches Kolonialblatt 3, 332-336.--Irmer, Georg (1894) Jahresbericht des Landeshauptmannes auf Jaluit 1. April 1893 bis 31. März 1894. In Acta betreffend Jahresschriften Allgemeinen Inhaltes auf den Marshall Inseln vom November 1894 bis Oktober 1900. Auswärtiges Amt Kolonial-Amt Avii Denkschriften in Bd. 2. N° 6525. National Library of Australia, Canberra. Microfilm G8600.--Irmer, Georg (1895a) Jahresbericht des Landeshauptmannes auf Jaluit 1. April 1894 bis 31. März 1895. In Acta betreffend Jahresschriften Allgemeinen Inhaltes auf den Marshall Inseln vom November 1894 bis Oktober 1900. Auswärtiges Amt Kolonial-Amt Avii Denkschriften in Bd. 2. N° 6525. National Library of Australia, Canberra. Microfilm G8600.--Irmer, Georg (1896) Jahresbericht des Landeshauptmannes auf Jaluit 1. April 1895 bis 31. März 1896. In Acta betreffend Jahresschriften Allgemeinen Inhaltes auf den Marshall Inseln vom November 1894 bis Oktober 1900. Auswärtiges Amt Kolonial-Amt Avii Denkschriften in Bd. 2. N° 6525. National Library of Australia, Canberra. Microfilm G8600.--Irmer, Georg (1897) Jahresbericht des Landeshauptmannes auf Jaluit 1. April 1896 bis 31. März 1897. In Acta betreffend Jahresschriften Allgemeinen Inhaltes auf den Marshall Inseln vom November 1894 bis Oktober 1900. Auswärtiges Amt Kolonial-Amt Avii Denkschriften in Bd. 2. N° 6525. National Library of Australia, Canberra. Microfilm G8600.--Senfft, Arno (1898) Jahresbericht des Landeshauptmannes auf Jaluit 1. April 1897 bis 31. März 1898. In Acta betreffend Jahresschriften Allgemeinen Inhaltes auf den Marshall Inseln vom November 1894 bis Oktober 1900. Auswärtiges Amt Kolonial-Amt Avii Denkschriften in Bd. 2. N° 6525. National Library of Australia, Canberra. Microfilm G8600.--Wolfgang Treue (1940). Der Erwerb und die Verwaltung der Marshall Inseln. Ein Beitrag zur Geschichte der Jaluit Gesellschaft. PhD . Berlin
Bibliographic citation for this document
Spennemann, Dirk H.R. (2000). Taxation in the German Marshall Islands
Dirk H.R. Spennemann, Institute of Land, Water and Society, Charles Sturt University, P.O.Box 789, Albury NSW 2640, Australia.
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