Evolution of The Philippine Taxation, Taxation in Spanish Philippines

EVOLUTION OF THE PHILIPPINE TAXATION,
TAXATION IN SPANISH PHILIPPINES

WHAT IS
TAXATION?
-Is a term for when a taxing authority, usually a government, levies or
imposes a tax.
- The term ‘’taxation’’ applies to all types of involuntary levies, from

income to capital gains to estate taxes.
EVOLUTION OF PHILIPPINE
TAXATION
In today's world, taxation is a reality that all citizens must contend with for the
primary reason that governments raise revenue from the people they govern to be
able to function fully. In exchange for the taxes that people pay, the government
promises to improve the citizens' lives through good governance. Taxation, as a
government mechanism to raise funds, developed and evolved through time, and in
the context of the Philippines, we must understand that it came with our colonial
experience.
TAXATION IN SPANISH PHILIPPINES
The Philippines may have abundant natural resources even before the oachment of the Spaniards, but
our ancestors were mainly involved in a subsistence economy, and while the payment of tribute or
taxes (buhis/ a subsistence economy, and while the paymbuwis/handug) or the obligation to provide
labor services to the datus in some early Filipino communities in the it is essentially different from the
contemporary meaning of the concept.
The arrival of the Spaniards altered this subsistence system because they imposed the payment of
tributos (tributes) from the Filipinos, similar to what had been practiced in all colonies in America. The
purpose is to generate resources to finance the maintenance of the islands, such as salaries of
government officials and expenses of the clergy.The difficulty faced by the Spaniards in revenue
collection through the tribute was the dispersed nature of the settlements, which they solved by
introducing the system of reduccion by creating pueblos, where Filipinos were gathered and awarded
plots of land to till. Later on, the settlements will be handled by encomenderos who received rewards
from the Spanish crown for their services
EXEMPTED OF THE PAYMENT OF TRIBUTE WERE:
 Pricipals
 Alcaldes
 Governadors
 Cabezas de Barangay
 Soldiers
 Member of the civil guard
 Government officials and vagrants
The Filipinos who were once satisfied with agricultural
production for subsistence had to increase production to
meet the demands of payments and a more intensive
agricultural system had to be introduced. Later on, half of the
tribute was paid in cash and the rest with produce. This
financed the conquest of the Philippines.
In 1884, the payment of tribute was put to a stop and was replaced by a
poll tax collected through a certificate of identification called the cédula
personal. This is required from every resident and must be carried while
traveling.
Unlike the tribute, the payment of cédulas is by person, not by family.

Payment of the cédula is progressive and according to income categories.
This system, however, was a heavy burden for the peasants and was east
for the wealthy. But because of this, revenue collection greatly increased
and became the main source of government income
In 1878, two direct taxes were added and imposed on urbn income
an d those are:
1. Urbana - is a tax on the annual rental

2. Industria -is a tax on salaries, dividends, and profits.
These taxes were and affected all kinds of economic activity except
agriculture which was exempt to encourage growth.
Indirect taxes such as customs duties were imposed on
exports and imports to further raise revenue, especially
during the nineteenth century en economic growth increased
exponentially. There were no excise taxes collected by the
Spaniards throughout the years of colonians.
Colonial goverment also gained income from
monopolies such as:
 The sale of stamped paper

 Manufacture ans sale of liquor
 Cockpits
 Opium
 tobacco
FORCE LABOR
Forced labor(also known as polo system) was a character of Spanish colonial taxation in the
Philippines and was required from the Filipinos.
Through the polo system, male Filipinos were obliged to serve, a burden that resulted in an
increase in death rate and flight to the mountains, which led to a decrease in population in the
seventeenth century. This changed later on, as polos and servicios became lighter, and was
organized at the municipal level. Labor provided was used in public works, such as the building of
roads and bridges. Some were made to serve the municipal office or as night guards.
Males were required to provide labor for 40 days a year (reduced to 15 days a year in 1884). They
may opt out by paying the fallas of three pesos per annum, which was usually lost to corruption
because it was collected at the municipal level and were known as caidas or droppings. The polos
would be called prestación personal (personal services) by the second half of the nineteenth
century.
Taxation in the Philippines during the Spanish colonial period was
characterized by the heavy burden placed on the Filipinos, and the
corruption of the principales, or the former datus and local elites who
were co-opted aniards to subjugate and control the natives on their
behalf. The principales who were given positions such as cabezas de
barangay or alcaldesin the local government were able to enrich
themselves by pocketing true and/or fallas, while the peasants were left
to be abused. Taxation appeared progressive but the disparity between
the less taxed principales and the heavily taxed peasants made the rich
richer and the poor poorer.

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EVOLUTION OF THE PHILIPPINE TAXATION,

TAXATION IN SPANISH PHILIPPINES

- The term ‘’taxation’’ applies to all types of involuntary levies, from

Unlike the tribute, the payment of cédulas is by person, not by family.

1. Urbana - is a tax on the annual rental

 The sale of stamped paper

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