Taxation is a gameplay mechanic in Pharaoh.
Tax Collectors collect taxes from neighborhoods, adding it to the city treasury. In order for tax collectors to be built and to function, a Palace must first be built. Tax rates are, by default, set by 9%, but can be adjusted at either the Palace or in the Overseers interface.The monetary overseer also shows how much of the population is registered for tax. One rate applies for all residents of a city; for example, a city with two residential areas cannot apply a 5% tax to one area and a 10% tax for another.
Different houses generate different amounts of taxes. Generally speaking, higher level housing pay higher taxes, although the rates at which they pay are not completely linear as they evolve. In particular, tax revenue grows significantly when housing is upgraded into manor-level housing or higher. Tax revenue for higher level housing is so high that it can often consist of the bulk of a well-developed city's income.
On the other hand, low level housing offers very little tax income, and may not be worth the funds and workers needed to have them running.
Taxes have an effect on city sentiment. If a significantly large portion of the city is not being taxed but others are, then discontent rises. High taxes decrease happiness, while low taxes achieve the opposite effect.