The study examines whether taxes levied on rubber, coconut, and pineapple smallholders in 1975 are a major cause for smallholder low income. Results of the study show that tax burden on the smallholder is substantial, particularly that on rubber smallholders. The average rubber smallholder pays about one-fourth to one third of his income in taxes. However, the scope for increasing income through changes in the tax structure is limited. Such changes should be coupled with programmes aimed at increasing farm productivity and size of holding.