Like many things, it’s an abstraction. A useful shorthand.
Like in CK II. Do the ducats represent some literal form of currency? Of course not! They represent an abstract value of all resources at the disposal of the nation. It can be good, but it also represents things like food rents used to feed armies, manditory feudal service for the serfs to do improvements to their lords lands. Access to quarries or dockyards. The rights of the minter to make a small profit from making the actual daily currency. In kind or service based kingdom taxation where they would get some fungible material instead of direct currency taxation.
Certainly if you think of it as literal coinage it starts to get silly!
But money as a medium of transaction is well understood and easy to visualize as a means of achieving disparate productive endeavors. So we don’t need to think of it as the king literally giving some serfs coinage to cut down trees and forming it into lumber which will be used to build a boat. That would be ridiculous in a feudal context. Instead it represents the king forgoing some direct taxation revenue. Basically saying ‘instead of paying taxes this year as two bushels of wheat and three sheep, and a barrel of beer, instead I want you to provide me with three trees worth of lumber to be provided to the docks’, who will instead of paying taxes as 50 pounds of spices collected as import duties, instead use that lumber to build one galley.
But each setting functions differently, of course. A sci fi setting naturally may use money as a different representation. Maybe not how we understand the term either.
However taxation in strategy games often follows a more medieval understanding on the correlation between population unrest and taxation levels. Because the idea of a 1:1 link does not mesh with modern society. There is absolutely a correlation between taxes and population unrest, but it is more correlated to satisfaction with services. Does the government function effectively, and provide the sort of societal benefits we expect? If yes then higher taxation levels are not an issue. But if there is not that perception of governmental effectiveness than even low taxation levels feel onerous. I mean if it is just going into the pockets of the military junta’s buddies? Then any amount is too much. But if you’re in Scandinavia then even high taxation doesn’t feel oppressive.