Duke Ai asked Youzi: “In years of famine when I don’t make enough to cover my expenses, what should I do?” Youzi replied: “Why not set the tax at ten percent?” Duke Ai said: “Even twenty percent would not be sufficient to meet my needs; how could I manage at ten percent?” Youzi replied: “If the people have enough to support themselves, how could their lord not have enough to meet his needs? If the people do not have enough to support themselves, how could their lord have enough to meet his needs?”
Taxes: another huge question we haven’t found a definitive answer to in 2,500 years. And judging by the remarkably low rates that Youzi and the Duke Ai are discussing here, we’ve actually moved in the wrong direction. As Youzi points out, lower taxes generally lead to higher revenues – not the other way round.
Youzi briefly succeeded Confucius as the leader of the original band of disciples but was soon abandoned by them. He is featured in various chapters in Book 1 of the Analects, but makes only very rare appearances elsewhere.