Chapter 1255 - Graycastle "Yuan"
Chapter 1255: Graycastle “Yuan”
Translator: Transn Editor: Transn
Below the policy was a sample application form.
Applicants not only had to provide their personal information but also their transaction records. Victor skimmed the application form through for several times, and suddenly, the truth flashed across his mind.
He finally understood the purpose of the new policies as his eyes shoveled between the fourth and fifth articles. It gradually dawned on him that the king’s true intention of making these two rules was to increase tax revenues!
Like most major cities, merchants in Neverwinter had the obligation to pay commercial taxes. However, the problem was that not every merchant abode the rule. Victor never missed a single payment, but tax evasion was actually very common among merchants. He was indeed one of the fews who paid the taxes every time.
Merchants who had real estate properties would, more or less, pay taxes partially, but those who leased the premises and traveling merchants almost never paid. Without the previous patrol team who had constantly blackmailed merchants, Neverwinter provided small business owners with a perfect, and even better tax-free zone than Valencia and Eagle City. Because of the great business environment, businesses had soon flourished in the new king’s city within a very short period of time.
But now, everything was about to change.
The application could waive the currency exchange transaction fee, but applicants would also need to provide their sources of revenues. Then the Administrative Office would deduct taxes from their earnings based on the information on the application form.
Was there no other way to evade taxes?
There certainly was. Merchants could exchange the new currencies for gold royals and sell their items bought from Neverwinter somewhere else to make up the loss.
But this was not a guaranteed solution.
Nobody could assure that the revenues would be exactly the same as the expenses. To maintain the business, one should possess more new currencies than the old ones. The only way to achieve this goal was to either exchange new currencies for gold royals or reserve the gold royals for the future.
As time progressed, merchants would, inevitably, have a certain amount of new currencies and realize that they were easier to use and carry. Gradually, merchants would exchange new currencies among themselves. They would probably exchange gold royals at first and then slowly, directly use them to purchase goods.
This meant that no matter which way merchants chose to go, Neverwinter would always benefit from them!
What was clever about this policy was that it did not really prejudice the interests of merchants. In fact, it was quite considerate of merchants’ feelings.
The declaration could increase the municipal tax revenues and thereby create a better business environment. On the other hand, legal business owners actually benefited from this policy as well.
For merchants who chose to use the new currencies, there would not be much difference. They could still evade taxes and press others to also use the new currencies. Since all transactions in Neverwinter should be conducted via the new currencies, the new currencies would gradually replace gold royals and spread out to the territories beyond the jurisdiction of the King of Graycastle!
Victor also noticed that the whole currency reform, as a matter of fact, aimed to take things slow and give people time to get used to the change.
Without a doubt, the new currencies would be legally effective as long as the King of Graycastle took control of food in his domain, not only because of the implementation of the currency policies but also because Neverwinter itself was a large market.
Merchants who fled the city might not even have truly thought about the policy. It was pretty shortsighted of them to abandon such a lucrative market simply because of the currency reform.
Victor used to think that the reform was ludicrous, but now it appeared that it was not as bad as he had thought. As long as King Roland Wimbledon guided the country properly and take appropriate steps, this reform might be a great success.
Victor shuddered involuntarily.
The currency reform was just the beginning.
Once everyone gladly accepted the new currencies, the king would immediately gain immense wealth that no business could ever bring.
The nobles who were so good at business in Kingdom of Dawn would probably drop their jaws.
The only problem right now was whether someone would forge the new currencies created by His Majesty.
Victor thus asked Twinkle to purchase some paper notes from local residents at a price five times the normal price on the payday two days later.
He soon found that his fear was unnecessary after he saw the actual notes.
“These notes are… so beautiful,” Twinkle exclaimed as she toyed with a brand new note.
“True,” Victor agreed. The new currency looked quite expensive, which was very different from what he had thought. It was soft and durable. Obviously, it was not made of ordinary paper.
The most peculiar part was its pattern on the face.
There were six kinds of paper notes in total, their face values ranging from 10 to 1,000. The largest value was equal to a gold royal, and one could easily tell from the golden pattern on it. The face values of the rest of the paper notes were 10, 20, 50, 100 and 500 each. A new currency unit “Yuan” was used. The colors and patterns of the paper notes varied according to their respective face values. For example, the 1,000 note was printed with the image of the king and the queen. Below printed a line that read “Royal Bank of Graycastle”. Although the font was tiny, it was pretty visible to read.
Victor drew the notes closer and discovered that the texts and the images on the notes were all comprised of tiny stripes even thinner than hairs. Each stripe was clear and separate from each other, so it was impossible to forge the notes.
Victor studied the other notes. The ￥500 note was printed with the image of the Witch Union and the ￥100 plants and workers. The other notes were printed with the Miracle Building, trains, etc. All the notes were printed with the coat of arms of the Graycastle royal family that featured a high tower and two spears on the back. Victor curled up his lips. It was evident that the notes were carefully designed and well made like artwork. Even if they did not have any practical values, Victor was sure that many collectors at the Fjords would be willing to collect them purely for their aesthetic values.
This was indeed a very clever strategy. The colorful notes definitely cost a lot, but in a way, they built confidence among the public. Nobody would have believed a piece of paper could replace gold royals. However, if this paper resembled a piece of art, then people would have more confidence in them, although essentially, they were the same thing.
Victor put down the notes and heaved a deep sigh.
“What’s the matter?” Twinkle asked curiously.
“There will be a drastic change in the business world soon,” Victor replied in a low voice.