[At present, the tribute paid by the Indians should not be increased
because so many of them would be distressed by any heavier tax; but
this might be done later, when the class of large proprietors may have
increased in numbers. The payment of this tax in kind is a source
of loss, not only in the quantity and quality of the products paid
in, but in the damage caused by transportation and storage; and in
selling the products thus received by the government there is loss,
because its agents are poor managers of such business, not having
the shrewdness or the knowledge of the markets which enable private
merchants to make their profits. The commutation of the payment from
money to kind was only partly due to the influence of the alcaldes,
who preferred it for the benefit of their own trading;] the cause which
has rendered that commutation almost necessary and which operates
directly to the prejudice of the Indian, is the lack of a colonial
money peculiar to the Filipinas Islands, like that which the other
possessions in Asia have (of the necessity of which I will speak in
another chapter), in order to revive internal commerce and promote
and facilitate the payment of taxes.
The indirect taxes by means of government monopolies in Filipinas
are, in my opinion, those most suitable to the native disposition of
inhabitants who, furnished most abundantly by the soil with all the
income necessary for their support, convert the superfluous enjoyments
of life into objects of prime necessity. It should be a firm principle
of good government to protect and rectify the administration of these
indirect taxes, especially those on tobacco and wine--not only because
these will be sufficient to cover abundantly all the expenses of army
and navy, but because in case of a war and the absolute cessation of
trade the government will have this firm support for its existence; and
therefore no hearing should be given to the suggestions and proposals
of those persons who are craftily working to free the islands from
those monopolies. But so long as these taxes are not made general
through all the provinces of the archipelago, so that the fire of the
contraband trade (which always finds lodgment in the exempt provinces)
may be extinguished, and until certain reforms are adopted in their
administration and protection, the produce [of these taxes] in favor
of the royal exchequer must be very disproportionate to the amounts
consumed by that large population.