Taxation

Taxation in M&T is a flow of wealth from those who are being taxed to those who are raising the tax. States raise tax by installing tax buildings in the provinces, while powerbrokers raise tax by having certain rights. State tax income and its source can be checked in provincial administration modifier by cycling through the modifier. You can also check tax income/spending of each classes by cycling through the population modifier.

It is important to note that taxation is not magic money. When a tax is raised, a corresponding amount of wealth is deducted from the treasury of whoever was taxed. That means less investment, less private spending, and therefore less growth.

State Taxation
States tax its populace by installing certain tax buildings in their provinces. When a tax is installed, it will incur annual cost in either adm, dip, or mil points depending on the type. Taxes that are tied to administration such as land tax, poll tax, etc, will cost adm points. Taxes that raise obligations from the provinces powerbrokers will cost dip points. Taxes that raise conscripted levies will cost mil points.

Tax cost is determined by two factors, base and multiplier. Both base and multiplier are dynamic, as in not set in stone and are dependent on province's situation. Actual tax cost is calculated as base * multiplier. While all taxes are unique and have distinct bases and multipliers, in general, taxes that cost adm or mil points are reliant on bureau effectiveness, and dip points their corresponding loyalty. Local autonomy also increases the cost of all types of taxes, while administrative efficiency decreases it.

Powerbroker Taxation
Powerbrokers also tax those under their influence should they have certain rights that enable it. Such taxation will not cost you any monarch points, but on default will also not benefit you in any way. You can tax what powerbrokers taxed through obligation buildings which cost dip points.