In view of the communications of the politico-military governor of
Sulu of October 6th of last year, in which he suggests to this general
government the concession of various exemptions in favor of the natives
of these islands and of any Chinamen who shall establish themselves in
the said place, to the end that by this means there may be promoted
the immigration which the interests of that island demand :
In view of the reports issued in the premises by the central adminis-
tration of imposts, the office of the insular auditor,^ and the insular
departments of civil administration and the treasury: and
Deeming it expedient, for the realization of the high purposes that
required the militar}^ occupation of Jolo and for the progressive and
efficacious development of the moral and material interests of this young
colony, that there should be granted certain exemptions for the encourage-
ment of the immigration thereto of the greatest possible number of
inhabitants: this office of the general government in conformity with
the suggestions made by the treasury department, and in accordance
with the statements made by the department of civil administration,
disposes the following :
1. All immigrants to the island of Sulu, of whatever class, race, or
nationality, who shall establish themselves definitively in the same,
engaging in agricultural, industrial, or commercial pursuits, or in any
art, trade, or occupation, shall be exempt during ten years from all the
contributions or taxes imposed, or which in the future may be imposed,
upon the inhabitants of the Philippine Archipelago.
2. The children of immigrants to Sulu, bom in said island or who
establish themselves there before becoming taxpayers in the pueblos of
their birth, shall commence to pay taxes at the age of twenty-five years,
but shall be exempt from military service so long as they reside in the
said island.
This decree shall be published in the Official Gazette and communi-
cated to the council of administration, the office of the captain-general,
and the insular department of civil administration ; and shall be returned
to the treasury department for such further action as may be proper.
In view of the investigation conducted by the intendant-general of
the treasury with the object of determining whether it would be ex-
pedient to prolong the term of exemption from all kinds of taxes and
imposts in favor of natives and of immigrants of whatever race or
nationality who are established, or who shall establish themselves, in
Sulu for the purpose of engaging in any kind of industry, commerce,
profession, art, or trade, or in agriculture:
In view of the reports issue<l by the said directive bureau of the
treasury and the politico-military governor of Sulu :
And considering that exemption from all burdens constitutes one of
the most efficacious means of encouraging the immigration demanded
by the interest of the archipelago in question; this general government,
in conformity with the suggestions made by the office of the intendant
of the treai^ur}' and the politico-military governor of Sulu, disposes that
the term of exemption granted by superior decree of this general govern-
ment of February 24th, 1877, shall be understood as extended for another
term of ten years, the said extension to be reckoned from the day follow-
ing that on which the first term expires, that is, from the 25th day of
February of the current year.
This decree shall be published in the Official Gazette; the Grovem-
ment of his Majesty shall be informed thereof and a copy of the records
transmitted ; it shall be communicated to the council of administration,
the tribunal of accounts, the office of the Captain- General, and the in-
sular department of civil administration; and shall be returned to Ihe
office of the intendant of the treasury for any further action that may
be proper.
Most excellent and most illustrious Sir: The politico-military
governor of Sulu, in a communication dated the 9th instant, states as
follows :
Most excellent Sib: As the time expiration of the exemptions granted to
Sulu and its port by decree of the general government under the able direction
of your Excellency, dated February 24th, 1877, and extended by superior order
issued from the same office for another term of ten years, on August 23rd, 1887,
is drawing near, the person who has the honor to sign hereunder believes that
the moment has come to call the attention of your Excellency to the matter, and
he takes the liberty to set down some remarks in the premises, to the end .that
when your Excellency determines what is deemed most expedient, they may be
taken under advisement.
In the exemptions granted to Sulu, it must be borne in mind that they affect
two distinct elements, which constitute the life and favor the development of
this locality. Some have reference to the exemption from all taxes, tributes,
and gabels imposed, or to be imposed, in favor of natives or foreigners taking
up their abode in the Sulu archipelago. Others refer exclusively to the declara-
tion of a free port, with exemption from all taxes and customs formalities in
favor of the capital of the island.
In treating this question and in considering what ought to be done in the
future, when the moment arrives for determining whether a fresh extension is
expedient, or whether, on the contrary, this territory must enter upon the normal
administrative life general in other localities of the Philippine Archipelago, the
subject must be dealt with undef the two aspects above set forth. In regard
to the declaration of freedom of the port granted to Jolo, it is undoubtedly
expedient to continue it for the present without change. So long as the protocol
entered into with the other nations who are parties thereto, continues in force —
in which protocol our incontestable right of sovereignty over this archipela^,
with the limitations therein stipulated, is declared — it would be highly impolitic
to close the period of franchise granted to this port. Should there be established
the embarrassing obstacles and difficulties to commerce entailed by the formalities
of customs regulations, the English steamers which now carry on the trade with
Singapore, would immediately cease to visit this port and would make their
destination some other port of the island, where, under the provisions of the
protocol above referred to, no one could lawfully obstruct them until after the
effective occupation of the new port selected for trading operations, and until
after having allowed to elapse the requisite time subsequent to publishing this
resolution in the official papers of the Peninsula. The distinguished intelligence
of your Excellency will perceive easily that after this had been repeated several
times, we should find ourselves compelled either to occupy effectively all the
islands of the Sulu archipelago where English steamers might attempt to
establish their business, or, in the end, to allow them to carry on their commercial
operations at any place that suited them, which, without doubt, would be much
more prejudicial than what happens at the present time; for, at any rate, so
long as steamers come exclusively to this port or to that of Siasi, as is the
case at present, the trade can be watched easily and conveniently and without
the commercial operations which are carried on giving rise to diplomatic ques-
tions; it is easy, also to prevent the traffic of arms and war supplies, which
would not be the case if they touched at other points where our sphere of action
is not so direct and effective. Furthermore, the advantages of the present
situation must also be taken into account. So long as these steamers touch only
at Jolo and Siasi, as happens now, these two points are the only markets,
whither all the people of the archipelago must necessarily go to trade, not only
to supply themselves with the effects which they import and are necessary to
life, but also to sell all the products they gather in their fields and in the seas,
which constitute the element of commerce that justifies English vessels in
visiting these regions, making it possible to collect sufficient freight to maintain
the two regular lines now established. It is obvious that, since we are masters
of the towDs of Jolo and Siasi — the only points of distribution for effects necessary
to the life of the natives here — we can, when we consider it expedient, prevent
the sale of these effects to the villages hostile to the city, a most momentous
advantage resulting therefrom and a means of government of inestimable value.
So long as the Moros have to supply themselves from these markets, our im-
portance is incontestable; all their outbreaks are easily checked without appeal
to violent methods; and the civilizing effect which results from the constant
intercourse which is necessitated by their coming to the occupied ports, is
extended, thereby modifying the sanguinary and turbulent habits of this race.
If the revenues from the duties which would be imposed were of sufficient
importance to cover the expenses entailed by the occupation of Sulu, the arguments
supporting the opinion above expressed could easily be set aside. But unfor-
tunately there can not be expected from the custom house of Jolo, in the event
of its establishment, even the expenses necessary to cover the salaries of the
personnel engaged therein. For, the foreign steamers which now visit this port
would immediately discontinue their voyages, and even though it were possible
. to prevent them from making port at some other place for the purpose of carrying
on their mercantile operations — a thing which would not be easy so long as the
treaty is in force — what would happen ? Why, that the trade would be continued
by means of smaller boats which would come from Borneo, and it would not
be feasible to prevent this except by the posting of a very large number of coast-
guards along the shores of the innumerable islands of Sulu, a method which it
would be altogether impossible to adopt. It is, therefore, unquestionably ex-
pedient to maintain the present status, whether the matter be considered under
its economic aspect or under that of the policy it is necessary to develop in this
territory. A very different course must, in the opinion of the undersigned, be
followed in the matter of the exemption from taxation granted to the inhabitants
of Sulu. These exists here a numerous Chinese colony, which is the element that
really enjoys the benefit of the advantages flowing from the present free-port
conditions, and it is neither just nor equitable that, while the Chinese find in us
the support and protection which enable them to carry on and develop the trade
in which they alone engage, they should not contribute in any way towards the
expenses of the Government which furnishes them so many advantages. It is,
therefore, expedient to impose upon all Chinaman residing in the Sulu territory
the obligation to pay the same taxes as are paid by those of the same race in
other parts of the Philippines. The establishment of this system promises not
only the profit of the sums which would be collected as a consequence thereof,
but also the desideratum of introducing order into the anarchical manner of
life obtaining among the Chinese here. As soon as the obligation to pay taxes
is imposed upon all and the lists of tax-payers are made up, individual interest
will see to it that all persons living in the country are included therein; for it
is unquestionable that, since each desires to be placed under the same conditions
as the the other, the Chinamen themselves will be of very great assistance in
discovering those who now are not included in the incomplete and untrustworthy
census lists existing in the offices of the Government of Sulu. It is believed,
then, that it is expedient and just to discontinue the franchise now enjoyed by
the Chinese here, and that they should begin to contribute at once towards
defraying the expenses of the treasury, paying at least as much as is paid by
their countrymen in other parts of the Philippines. It would appear also equi-
table that the Indians residing here should also begin to pay the c6dulas^ of the
class to which they respectively belong; but there must be borne in mind the
limited number of individuals of this race residing here; the expediency of
encouraging by this means the immigration of fresh residents; and, above, all,
'the services they render in any case of alarm, whether caused by jurameniadvs
or by more serious aggressions attempted against the city; all of which circum-
stances make it proper that they should continue enjoying the exemption from
the payment of poll-tax which they now enjoy, as also exemption from all the
other taxes upon the insignificant industries from which they gain a subsistence.
The treasury could not hope for any happy results in this direction; and, on
the other hand, if such a tax were imposed, the place would, in a very short
time, be left entirely without any civilian population; for only with difficulty,
and thanks to the franchises, can persons be found who will face the constant
danger in which residents in Jolo are placed — especially those who engage in the
cultivation of the soil in the outskirts of the town; of which class the civilian
population is, in a very large majority, composed.
It remains, only, most excellent Sir, to discuss the expediency, or otherwise,
of establishing taxation upon commerce, industry, and property. All the urban
property of Jolo is in the hands of the Chinese, with so few exceptions that
there are not more than three property holders who do not belong to that race.
In their hands is all the commerce, with the sole exception of two Spanish
houses: every thing relating to business is in their power; so that any burden
imposed in this direction would not be borne by them, but would be paid by the
garrison of Jolo. For, united as the Chinamen are in every thing that relates
to the avoidance of tax-paying, they would come to a perfect understanding to
surtax every thing, — not in the same proportion as the contributions they would
pay, but with a considerable increase, with the result that the only tax-payer to
the treasury and for the Chinaman would be the unfortunate inhabitant of Jolo.
And since the population here consists almost entirely of the garrison, which
renders such arduous services at this place, I believe that it would not be just
to add to the other disadvantages that the service here offers, the very serious
one that would result from the imposition of taxes in this capital. Furthermore,
one must not lose sight of what might happen or rather what would immediately
happen, when, by taxing the commerce of the city, the majority of the Chinamen
now established here would go to Maymbung, with a tendency to store their
merchandise at other important points in the island, in which places our rule is,
it may be said, nominal, and it is imnecessary to insist upon the undesirable
consequences that would follow; for we should return to the condition in which
Maymbung stood in April of the year 1887, when this town was a very important
center of resistence to our rule, due to the facility afforded in that place for the
purchase of unlimited arms and ammimition, a business carried on by the foreign
steamers who anchored there at that time. And all this without taking into
account the undesirability, from a political point of view, of affording the Moros
the opportunity of purchasing their supplies at prices lower than those in this
city; since, if the merchants in that town did not pay taxes they would be able
to sell at lower prices than those in the capital. Summing up what I have
stated above and recapitulating the questions herein treated, I will conclude by
submitting to the distinguished intelligence of your Excellency that I consider
necessary and of the highest political expediency the maintenance of the freedom
of the port granted to Jolo; that this franchise should be extended to Siasi,
which enjoys this privilege in fact though not by right; and that care should
be taken to prevent the slightest obstacle from interfering with the trade at both
points, to the end that foreign steamers may, in their own interest, touch only
at these two points of the archipelago of Sulu; that the Chinamen should be
forniM into guilds or associations, after the pattern of the organizations prevail-
ing in other parts of the Philippines, these being necessary, further, to the
making up of the lists of tax-payers; that, as a consequence of the formation*
of these associations, they should be compelled to pay taxes to the same extent
as all other Chinamen residing in the country, unless your Excellency is of the
opinion that the quota should be increased in consideration of the other advantages
they enjoy; that there should be imposed a tax upon smokers of opium and
upon the importation thereof. This tax would be a source of revenue of some
consideration if it were farmed, as was the intention four years ago, when sale
to the highest bidder was desisted from in view of the decree of franchises which
is the subject of this communication. Finally, that property, commerce, and
industries should not be taxed, nor should the civilian population be burdened
with the poll-tax, since the latter deserve consideration by reason of the arduous
services they render in this place: and this applies to the garrison, as well as
to the civilians who make up the town, who, in the end, would be the persons
who alone would have to bear these burdens. Such, most excellent Sir, is the
opinion, expressed as succinctly as possible, of the undersigned in regard to these
matters, which, at no distant date, will present themselves for resolution and
which your Excellency will determine with your well-known ability and good
judgment.
Which I have the pleasure to transmit to your most Illustrious Excel-
lency, to the end that you may take note of the part relating to the
economic side of this question.
The just considerations
set forth by the politico-military governor of Sulu in a connnunication
addressed to his high Excellency the Governor-General of these islands
on July 9th of last year, forwarded to your most illustrious Lordship on
the Slst of the same month and year, reveal a close study of the ques-
tions treated, based upon practice and experience.
The chief of the division of direct imposts, who signs hereunder, in
presenting the report ordered by your most illustrious Lordship in your
decree of the first day of the following August, must begin by expressing
at once his conformity with the views given by the governor of Sulu,
in the part relating to this division.
Undoubtedly considerations of the highest political moment led the
high authorities of the Archipelago, on August 23rd of 1887, to extend
for another term of ten years the franchises granted to Sulu, and since
these considerations have not ceased to be of moment, to judge from the
enlightened views expressed by the said politico-military governor, it
is to be presumed that it is expedient to grant a fresh concession of
franchises ; but not, at this time, for a period of time equal to that about
to expire, though for a period that might well be half that of the previous
term; for, regarding the matter prudently, it might happen that during
this lapse of time the conditions in the places under discussion should
alter in such a way as to counsel either the total suppression of the
liberties in question or their partial modification.
But if there are considerations in favor of this new concession, equity
counsels that there be excluded therefrom the Chinese in so far as relates
to the imposition of the poll-tax, since they control all the business and
are the only persons who really exploit that region.
Consequently, the chief of the division of direct imposts has the honor
to report to your most illustrious Lordship :
1. That it be recommended to his high P]xcellency the Governor-
General of these Islands, that, to take the place of the present franchises,
there be granted again, at the proper tim^, to the ports of Jolo and
Siasi, the exemption from the payment of all urban and industrial taxes
in favor of the natives and of the Chinese established at those points.
2. That there be created at once the imposition of the poll-tax upon
the Chinese.
3. That the natives and the civilian population be exempt from the
payment of poll-tax.
In compliance with
the decree which, under date of August 10 of the current year, your most
illustrious Excellency saw fit to issue, to the effect that, in the shortest
possible space of time the divisions of imposts should report upon the
matters concerning each one in the proceedings set on foot by the
politico-military governor of Sulu in regard to the expediency or the
inexpediency of the renewal of the exemption from taxation enjoyed
by the natives in that place, I have to state to your illustrious Excellency
that :
1. The undersigned chief, fully agreeing with the enlightened views
set forth by the governor of Sulu, believes that the maintenance of the
dedaration of freedom of the port granted to Jolo is of the highest
political moment and that the franchise should be extended to Siasi.
2. That in regard to indirect imposts which are of such a nature that,
while they are a source of profit to the state, they bring also no small
benefit to the tax-payer, these should be made applicable to the Sulu
archipelago, as undoubtedly has been the case, as a matter of fact, up
to the present time in regard to the stamp and lottery revenues.
• 3. Both for the reasons set forth by the governor of Sulu as well as
for these given by his predecessor on June 11, 1893, in favor of a tax
upon opium smokers, the undersigned chief believes that it is not only
just but a matter of the greatest necessity to continue the imposition
of this tax.
