At this period, public opinion in the Spanish Universities was very divided with respect to Catholic missions in the Indies. Some maintained that the propaganda of the faith ought to be purely Apostolic, such as Jesus Christ taught to His disciples, inculcating doctrines of humility and poverty without arms or violence; and if, nevertheless, the heathens refused to welcome this mission of peace, the missionaries should simply abandon them in silence without further demonstration than that of shaking the dust off their feet.
Others held, and amongst them was Sánchez, that such a method was useless and impracticable, and that it was justifiable to force their religion upon primitive races at the point of the sword if necessary, using any violence to enforce its acceptance.
Much ill-feeling was aroused in the discussion of these two and distinct theories. Juan Volante, a Dominican friar of the Convent of Our Lady of Atocha, presented a petition against the views of the Sánchez faction, declaring that the idea of ingrafting religion with the aid of arms was scandalous. Juan Volante was so importunate that he had to be heard in Council, but neither party yielded. At length, the intervention of the Bishops of Manila, Macao and Malacca and several captains and governors in the Indies influenced the King to put an end to the controversy, on the ground that it would lead to no good.
The King retired to the Monastery of the Escorial, and Sánchez was cited to meet him there to learn the royal will. About the same time the news reached the King of the loss of the so-called Invincible Armada, sent under the command of the incompetent Duke of Medina Sidonia to annex England. Notwithstanding this severe blow to the vain ambition of Philip, the affairs of the Philippines were delayed but a short time. On the basis of the recommendation of the junta, the Royal Assent was given to an important decree, of which the most significant articles are the following, namely:—The tribute was fixed by the King at ten reales (5s.) per annum, payable by the natives in gold, silver or grain, or part in one commodity and part in the other. Of this tribute, eight reales were to be paid to the Treasury, one-half real to the bishop and clergy (sanctorum tax), and one-and-a-half reales to be applied to the maintenance of the soldiery. Full tribute was not to be exacted from the natives still unsubjected to the Crown. Until their confidence and loyalty should be gained by friendly overtures, they were to pay a small recognition of vassalage, and subsequently the tribute in common with the rest.
Instead of one-fifth value of gold and hidden treasure due to His Majesty (real quinto), he would thenceforth receive only one-tenth of such value, excepting that of gold, which the natives would be permitted to extract free of rebate.
A customs duty of three per cent. ad valorem was to be paid on merchandise sold, and this duty was to be spent on the army.
Export duty was to be paid on goods shipped to New Spain (Mexico), and this impost was also to be exclusively spent on the armed forces. These goods were chiefly Chinese manufactures.
The number of European troops in the Colony was fixed at 400 men-at-arms, divided into six companies, each under a captain, a sublieutenant, a sergeant, and two corporals. Their pay was to be as follows, namely:—Captain ₱35, sub-lieutenant ₱20, sergeant ₱10, corporal ₱7, rank and file ₱6 per month; besides which, an annual gratuity of ₱10,000 was to be proportionately distributed to all.
Recruits from Mexico, for military service in the Islands, were not to enlist under the age of 15 years.
The Captain-General was to have a body-guard of 24 men (Halberdiers) with the pay of those of the line, under the immediate command of a Captain to be paid ₱15 per month.