When a political party is successful in securing the election of its candidates as members of Parliament or as members of the national or local government, it will be in a position to benefit from access to public funds.
(a) In modern times, members of Parliament, particularly those in industrialised countries, are normally entitled to salaries and allowances for travel, office, and research costs.
(b) In some countries and at certain levels of government, the governing party is entitled to what have traditionally been known as the 'spoils' of office. In particular, they are able to provide public employment to political supporters. In countries such the United States, trade unions of public service workers have attempted to secure the rights of workers to security of tenure of their jobs and have, with considerable success, tried to limit the power of incoming mayors and state governors to dismiss workers employed by their predecessors and to replace them with their political cronies. Nevertheless, appointments on the basis of political patronage rather than on the basis of qualifications are still common in many parts of the world.
(c) Political leaders frequently have an influence over which companies will be granted public contracts.
In view of their powers to award jobs and contracts, it is not surprising that governing parties use this power to demand kick-backs from those to whom they grant these benefits. Members of Parliament, especially those representing Communist or Socialist parties, have in a number of countries (such as Germany) made regular demands on elected office-holders to pay a portion of their public salaries into the party's coffers. The reasoning is that they owe at least part of their salary to the party which has been responsible for their success in the last election and which has the power to engineer their deselection at the next election.
In a number of states in the United States, unskilled workers appointed to jobs in public authorities on the basis of political recommendations were traditionally expected to give a part of their pay to the party machine. One method of 'taxation' was to pressure patronage employees to purchase expensive tickets for fund-raising dinners held on behalf of the party or of its major political candidates.
As far as 'party taxes' extorted from contractors are concerned, it was reportedly a regular practice of Communist-ruled local authorities in France and Italy to demand payments for party funds from those awarded local government contracts for building works or for other purposes. According to some reports, the system of 'party tax' for contractors also had an international dimension in Italy. Here, major companies given contracts for exports to the Soviet Union were sometimes expected to pay a set percentage of the contract total as a donation to the Italian Communists.
Obviously, it is hard to conduct reliable research into the scale of such 'party taxes'. But they are clearly a significant feature of political financing in a number of countries, demonstrated by the large number of different words used to describe these taxes.
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