Philip economy

Question 1

When was Philip’s first bankruptcy?

Answer 1

1557

Question 2

Why did Philip go bankrupt in 1557?

Answer 2

• Charles left Philip a total debt of 36 million ducats and an annual deficit of 1 million ducats
• By 1556, 68% of Spain’s revenue had been marked off to pay debts
  -inflation, competition for bullion in the new world, high tax burden for Spanish merchants
• church and upper class were exempt from taxation therefore burden fell to classes involved with trade and commercial
• expulsion of religious groups deprived Spain of key people in jobs

Question 3

How did Philip deal with his bankruptcy?

Answer 3

• heavily reliant on taxes with the servicio tax made the primary one that and the crusada and the exusado tax (1567) were known as the “three graces” reaching up to 1.4 million ducats a year by the 1590s
  -overall Philip failed to deal with the issue

Question 4

consequences of the 1557 bankruptcy

Answer 4

• Philip’s ineffective attempt to stop the price rise in 1557 meant by 1580s the Spanish imported wheat
• taxed people heavily but was not enough
  -wars that were not self financing e.g armada

Question 5

When was Philip’s 2nd bankruptcy

Answer 5

1575

Question 6

causes for Philip’s 2nd bankruptcy

Answer 6

• showed weakness for big project e.g the Armarda costing 10 million ducats
  -never fully recovered from first bankruptcy
  -1567-1600 80 million ducats sent to the Netherlands but also troops in Italy and France
  -lack of good mitilia as the raid on Cadiz in 1587 and 1596 cost Philip estimated 20 million ducats

Question 7

What was the interest o pay of the debts cost?

Answer 7

5.5 million per annum

Question 8

How much more the 1570s military campaigns costing per month?

Answer 8

700,000 ducats

Question 9

how much did the Armada cost per month

Answer 9

900,000 ducats

Question 10

how may ducats did Philip spend in France in the last decade of his reign?

Answer 10

30 million

Question 11

how much did royal income increase form 1559 to 1590s

Answer 11

3 million to 10 million ducats

Question 12

how much did taxation increase by in the years 1556-70

Answer 12

50%

Question 13

How much did taxation increase from 1570 to 1600

Answer 13

90%

Question 14

where was most of his income reliant on

Answer 14

Castile and the new world

Question 15

What did the revolts in the Netherlands cause

Answer 15

issues raising money as this had been a major source of money for Charles

Question 16

when was the milliones tax introduced

Answer 16

1588

Question 17

Was the millones tax good?

Answer 17

it was a tax on all food stuff paid by all but hit the poorest hard making it the most unpopular tax of his reign

Question 18

What as the exusado tax

Answer 18

tax on clerical property usually paid in a lump sum by the church this helped pay for Alba in the Low Countries

granted by the pope

Question 19

how much did income from the new world increase by

Answer 19

4x

Question 20

what debts did Philip leave?

Answer 20

debts of 68 million ducats
3x what he inherited
coupled with what he had inherited this totalled to 85 million by the time of his death

Question 21

how much did 900,00 ducats per annum in the 1560s go to in the 1590s

Answer 21

3x

Question 22

What did large amounts of gold and silver from the new world mean for people back in Spain

Answer 22

led to rise in inflation from 1560-1600 Spanish people could afford 205 less goods