Taxation Through Time: Exploring the History of Taxation in the

Philippine

Regine P. Comitan

A199

April 04, 2024

INTRODUCTION
*Thesis statement

An exploration of the history of taxation in the Philippines,

this paper aims to analyze the taxation in the Philippines including
its origins, evolution, significant milestones, and impact on
society.

Taxation in the Philippines is a crucial basis for the

country's economic system. The Philippine government relies on
tax revenue to fund its operations and finance its development
projects. Being the lifeblood of the government, tax revenue is a
critical part of the country's economic and fiscal policy. Aside from
the revenue that taxes generate, they also help promote economic
stability and growth. By imposing taxes on goods and services, the
government can discourage unnecessary consumption and
production and ensure that resources are used more efficiently.
The Philippines uses taxes to redistribute income and wealth in
society. Progressive taxation systems, for instance, tax higher
incomes at higher rates to reduce inequality.

BODY

A. Pre-colonial taxation system

In the pre-colonial Philippines, Government were called

barangays, ancient Filipinos paid taxes called "buwis" or "handug"
to their rulers known as "datus" in exchange for protection. There
were three main social classes - the nobility, warrior class, and
slaves/commoners. During the Spanish period from 1521 to 1898,
the Spanish introduced new taxes like the Manila- Acapulco
galleon trade, polo y servicio forced labor, and bandala agricultural
requisitions. Under American rule from 1898 to 1946, they
implemented a residency tax called the cedula that required
Filipinos over 18 to pay.

B. Spanish colonial period taxation system

Taxation during the Spanish period was COMPULSORY. All

Spanish colonies in America and the Philippine were required to
pay taxes for TWO (2) REASONS: (1) as recognition of Spain's
sovereignty over the colonies (2) to defray the expenses of
pacification (the act of forcibly suppressing hostility within the
colonies) and governance.

During the Spanish era, the Spanish authorities

implemented various taxation policies including the encomienda
system, and the tribute system. The encomienda system was a
formal system of forced labor in Spanish colonies in Latin America
and the Philippines, intended to encourage conquest and
colonization. Under this system, leaders of the indigenous
community paid tribute to colonists with food, cloth, minerals, or
by providing laborers. The tribute system on the other hand, was a
system that forced indigenous populations to pay tribute in the
form of products or labor to Spanish officials. Failure to pay could
result in punishment or forced labor. (Boncan, 2016)

The Spanish Taxation had a profound impact on indigenous

people and the economy during the Spanish era. The indigenous
people suffered greatly as a result of the Spanish taxation policies,
which often took the form of tribute payments.

C. American period taxation system

Significant changes and tax reforms were implemented in

the Philippines during the American colonial era. In contrast to the
previous Spanish tax system, the United States introduced a
modern tax system that included the development of an income
tax. The income tax was implemented to raise revenue for the
government and promote economic development in the Philippines.

This modern tax system aimed to provide a more equal and

efficient way of collecting taxes, reflecting the impact of American
governance and economic policies at the Time. The implementation
of income tax under American rule marked a significant shift in
the Philippines setting the groundwork for the country's future
economic policies.

D. Post-Independence taxation system

After gaining the independence from colonial rule,

Philippines implemented various taxation policies to support its
economy and administration. One important policy was the
passage of the National Tax Act of 1939, which created a
comprehensive tax system in the country. This law established
income tax, estate tax, and excise tax, among others, to raise
revenue for the administration and promote economic
development. The implementation of these taxation policies played
an important role in shaping the Philippines' fiscal landscape post-
independence.

CONCLUSION

In conclusion, this paper has explored the history of

taxation in the Philippines, tracing its origins, evolution,
significant milestones, and impact on society. Through this
exploration, I have gained a deep understanding of how taxation
has played an important role in shaping the economic and social
landscape of the country.
 Taxation in the Philippines was not only been a means of
generating administrative revenue but has also means as a tool for
nation-building and economic development. By examining the
various taxation policies and reforms introduced throughout
history, we can see how they have contributed to a country's
growth Ang progress. From the establishment of modern tax
systems under American rule to the implementation of
comprehensive tax codes post-independence, taxation has been
instrumental in funding public services, infrastructure projects,
and social welfare programs that have benefited society as a whole.

As for me, taxation is the reason why a government is

functioning. The people pay taxes to the government and in
exchange, the government give services and good governance to
them. Taxation has evolved through time wherein it became the
reason why the government raise its revenues.

REFERENCES

Taxation in the Philippines I

https://www.jstor.org/stable/2140422

Taxation in the Philippines. II

https://www.jstor.org/stable/2140383