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Mounting deficits

Under Philip IV, the annual ordinary revenues of the French royal government totaled approximately 860,000 livres tournois, equivalent to 46 tonnes of silver. Overall revenues were about twice the ordinary revenues. Some 30% of the revenues were collected from the royal demesne. The royal financial administration employed perhaps 3,000 people, of which about 1,000 were officials in the proper sense. After assuming the throne, Philip inherited a sizable debt from his father's war against Aragon. By November 1286 it reached 8 tonnes of silver to his primary financiers, the Templars, equivalent to 17% of government revenue. This debt was quickly paid off, and, in 1287 and 1288, Philip's kingdom ran a budget surplus.

After 1289, a decline in Saxony 's silver production, combined with Philip's wars against Aragon, England and Flanders, drove the French government to fiscal deficits. The war against Aragon, inherited from Philip's father, required the expenditure of 1.5 million LT (livres tournois) and the 1294–99 war against England over Gascony another 1.73 million LT. Loans from the Aragonese War were still being paid back in 1306.

To cover the deficit, Pope Nicholas IV in 1289 granted Philip permission to collect a tithe of 152,000 LP (livres parisis) from the Church lands in France. With revenues of 1.52 million LP, the church in France had greater fiscal resources than the royal government, whose ordinary revenues in 1289 amounted to 595,318 LP and overall revenues to 1.2 million LP. By November 1290, the deficit stood at 6% of revenues. In 1291 the budget swung back into surplus only to fall into deficit again in 1292.

The constant deficits led Philip to order the arrest of the Lombard merchants, who had earlier made him extensive loans on the pledge of repayment from future taxation. The Lombards' assets were seized by government agents and the crown extracted 250,000 LT by forcing the Lombards to purchase French nationality. Despite this draconian measure, the deficits continued to stack up in 1293. By 1295, Philip had replaced the Templars with the Florentine Franzesi bankers as his main source of finance. The Italians could raise huge loans far beyond the capacities of the Templars, and Philip came to rely on them more and more. The royal treasure was transferred from the Paris Temple to the Louvre around this time.