He divided the States into following sections:
(i) Public Finance (ii) Army (iii) Central Secretariat (iv) Judiciary and (v) Provincial Oficers.
The department of the Public Finance was divided into two sections:
(a) Collection section and (b) Distribution section
Collection Section was sub-divided into three heads and only three kinds of taxes were allowed to be collected by Imam Ali:
(i) Land Revenue: It was usually collected in coins of silver and gold or in bullion. Officers collecting this revenue were some times appointed by the center, but the Imam had also authorized the governor to appoint such officers himself.
(ii) Zakat (Religious Tax) and Sadaqa (obligatory alms): It was usually collected in kind or in live-stock. Officers who were to collect this revenue were always appointed directly by the Imam and he took great care to appoint honest and pious persons on these posts and to have a close watch on their activities and behaviour.
(iii) Jizya: A tax from non-Muslims in lieu of Zakat, etc. and in return for the security and amenities provided to them. Collection of no other kind of tax, from non-Muslims was allowed by the Imam.
Land survey was carried on by him whenever necessary. Every tax payer had the right to appeal and an appellate court was founded. Officers for this court were directly appointed by the Imam.
Imam Ali was the first man to introduce the budget system for collection of revenues and for its expenditure. Each province had to present its budget directly to him for approval. The income was divided into two heads, provincial and central. Zakat and Sadaqa were items of the Central Revenue while, Land Revenue and Jizya were Provincial Revenue.
The schedule of rate for Land Revenue was fixed by him as under:
1. 1st class, (most fertile) land One and a half Dirham per Jarib
2. 2nd class, (fertile land) One Dirham per Jarib.
3. 3rd grade land Half Dirham per Jarib
4. Vine yards, orchards, etc. Ten Dirhams per Jarib.
(One Jarib being 2269 square yards, approximately)
Sadaqa and Zakat were the taxes which only Muslims had to pay. It was a tax levied on personal income, landed property, hoarded bullions, currency and live-stock, and its rate was fixed by the tenets of Muslim Law.
Jizya was a personal tax, collected per head of a person irrespective of his income or property. But such persons were divided into various classes. It was an annual tax. The division of classes was as under:
1st class: Very rich persons and land-owners 48 Dirhams per head
2nd class: Middle class people 42 Dirhams per head
3rd class: Businessmen 42 Dirhams per head
4th class: General public 12 Dirhams per head
There were strict orders that no Jizya was to be collected from beggars and persons falling unde following categories:
(i) Those who were above 50 years of age,
(ii) Those who were below 20 years of age,
(iii) All women-folk,
(iv) All paralysed persons,
(v) All disabled persons,
(vi) All blind persons and
(vii) All insane persons
Income from the source of Zakat and Sadaqa was reserved for the following heads:
(i) Administration of the Departments of Collection and Distribution
(ii) Grants, donations and aids to the poor, destitue, orphans, aged widows and disabled persons.
(iii) Stipends to volunteers who fought for the State
(iv) Pensions to widows and orphans of soldiers and officers of the army
(v) To acquire and to set free slaves from the bondage
(vi) Reparation of government loans
(vii) To help Hajis (pilgrims) whenever and wherever they were found stranded
Items (iii) to (vi) were introduced for the first time by Imam Ali and so far as item (vi) was concerned, previously no ruler ever thought of his kingdom to be morally obliged to pay back a loan taken from somebody.
Imam Ali was the first man who declared that a ruler’s share of income from the State was equal to that of any commoner.
Income from Jizya was earmarked for the following items of expenditure:
(i) Maintenance of army
(ii) Construction and maintenance of forts
(iii) Construction and maintenance of roads and bridges
(iv) Sinking of wells and
(v) Construction of inns.
Land Revenue was the provincial income to be spent on maintenance of courts, offices, and other necessary items as per orders of the Center. Before I bring to an end, the description of his system of Revenue Collection, I must mention a remark passed by him in this regard to one of his governors. He said,
“So far as collection of Land Revenue is concerned, you must always keep the welfare of the tax-payer, which is of greater importance than the taxes themselves, and as acutal taxable capacity of people rests on fertility of land, therefore, more attention should be paid to the fertility of land and prosperity of the subjects than to the collection of revenues”. (Nahjul Balagha, Letter 53)
Distribution of public wealth was a subject on which Imam Ali (AS) devoted much attention and which in return caused him to lose many supporters and followers.
For more details kindly refer : A Biographical Profile of Imam Ali (a.s)