Chapter 10

Authorities.—A B C of the Foreign Exchanges, by George Clare;Foreign Exchanges, by Goschen;Arbitrage, by Deutsch;Arbitrages et Parités, by Ottomar Haupt; Swoboda,Arbitrage(12th edition), by Max Fuerst.

(E. M. Ha.)

EXCHEQUER.The word “exchequer” is the English form of the Fr.échiquier, low Lat.scaccarium, and its primary meaning is a chess-board (seeChess). As the name of a government department dealing with accounts it is derived from the exchequer or the “abacus” by means of which such accounts were kept, such a contrivance being almost universally in use before the introduction of the Arabic notation. In England the department or court of accounts was named originally “the tallies” from the notched sticks or tallies which constituted the primitive means of account-keeping (which were only abolished in 1826), and was only subsequently, probably in the reign of Henry I., named the exchequer from the use of the abacus. Both the name and the general features of the institution may reasonably be attributed to Norman influence, since we find both in Normandy and in the Norman kingdom of Sicily, as well as in Scotland and Ireland; the two latter cases being directly due to English example. As a court of law the exchequer owed its existence in England, as elsewhere, to the necessity of deciding legal questions arising from matters of account, and its secondary activities soon overshadowed its original functions.

We cannot say whether the exchequer, as known in England, is older than the beginning of the 12th century. The treasury, which may be regarded as one of its constituents, dates from before the conquest, and the officers of the exchequer who were drawn from the treasury staff can be traced back to Domesday. But our earliest information about the exchequer itself, apart from that afforded by the pipe rolls (seeRecord), rests on atreatise (Dialogus de Scaccario) written aboutA.D.1179 by Richard, bishop of London and treasurer of England. His father, Nigel, bishop of Ely, had been treasurer of Henry I., and nephew to that king’s great financial minister Roger, bishop of Salisbury. Nigel is said to have reconstituted the exchequer after the troubles of Stephen’s reign upon the model which he inherited from his uncle. The Angevin, or rather the Norman, exchequer cannot be regarded in strictness as a permanent department. It consisted of two parts: the lower exchequer, which was closely connected with the permanent treasury and was an office for the receipt and payment of money; and the upper exchequer, which was a court sitting twice a year to settle accounts and thus nearly related to the Curia Regis (q.v.). We dare hardly say that either exchequer existed in vacation; indeed the word (like the word “diet”) seems to have been limited at first to the actual sitting of the king’s court for financial purposes. The Michaelmas and Easter exchequers were the sessions of this court “at the exchequer” or chess-board as it had previously sat “at the tallies.” The constitution of the court was that of the normal Frankish curia. The king was the nominal president, and the court consisted of his great officers of state and his barons, or tenants-in-chief, and it is doubtless due to the fact that the exchequer was originally the curia itself sitting for a special purpose that its unofficial judges retained the name of “barons” until recent times. Of the great officers we may probably find the steward in the person of the justiciar, the normal president of the court. He sat at the head of the exchequer table. The butler was not represented. The chancellor sat on the justiciar’s left; he was custodianex officioof the seal of the court, and thus responsible for the issue of all writs and summonses, and moreover for the keeping of a duplicate roll of accounts embodying the judgments of the court. On the left of the chancellor, and thus clear of the table, since their services might be required elsewhere at any moment, sat the constable, the two chamberlains and the marshal. The constable was the chief of the outdoor service of the court, and was responsible for everything connected with the army, or with hunting and hawking. The two chamberlains were the lay colleagues of the treasurer, and shared with him the duty of receiving and paying money, and keeping safe the seal of the court, and all the records and other contents of the treasury. The marshal, who was subordinate to the constable, shared his duties, and was specially responsible for the custody of prisoners and of the vouchers produced by accountants. At the head of the table on the justiciar’s right sat, in Henry II.’s time, an extraordinary member of the court, the bishop of Winchester. The treasurer, like the chancellor a clerk, sat at the head of the right-hand side of the table. He charged the accountants with their fixed debts, and dictated the contents of the great roll of accounts (or pipe roll) which embodied the decisions of the court as to the indebtedness of the sheriffs and other accountants. These persons with certain subordinates constituted the court of accounts, or upper exchequer, whereas the lower exchequer, or exchequer of receipt, consisted almost exclusively of the subordinates of the treasurer and chamberlains. In the upper exchequer the justiciar appointed the calculator, who exhibited the state of each account by means of counters on the exchequer table, so that the proceedings of the court might be clear to the presumably illiterate sheriff. The calculator sat in the centre of the side of the table on the president’s left. The chancellor’s staff consisted of theMagister Scriptorii(probably the ancestor of the modern master of the rolls), whose duties are not stated; a clerk (the modern chancellor of the exchequer) who settled the form of all writs and summonses, charged the sheriff with all fines and amercements, and acted as a check on the treasurer in the composition of the great roll; and a scribe (afterwards the comptroller of the pipe), who wrote out the writs and summonses and kept a duplicate of the great roll, known as the chancellor’s roll. The constable’s subordinates were the marshal and a clerk, who, besides the duty of paying outdoor servants of the crown, had the special task of producing duplicates of all writs issued by the Curia Regis. The treasurer and chamberlains, being colleagues, had a joint staff, the clerical or literate members of which were servants of the treasurer, while the lay or illiterate members depended on the chamberlains. Hence while the treasurer and his clerks kept their accounts by means of rolls, the chamberlains and their serjeants duplicated them so far as possible by means of tallies. Thus the great roll was written by the treasurer’s scribe (the engrosser, afterwards the clerk of the pipe), while the payments on account and other allowances to be credited to the sheriff were registered by the tally cutter of the chamberlains.

In the exchequer of receipt the staff was similarly divided between the treasurer and chamberlains; the treasurer having a clerk who kept the issue and receipt rolls (the later clerk of the pells) and four tellers, while each of the chamberlains was represented by a knight (afterwards the deputy chamberlains), who controlled the clerk’s account by means of tallies, and held their lands by this serjeanty; these three had joint control of the treasury, and could not act independently. The other serjeants were the knight or “pesour” who weighed the money, the melter who assayed it, and the ushers of the two exchequers. It should be noted that all the lay offices of the treasury in both exchequers were hereditary. Henry II. had also a personal clerk who supervised the proceedings personally in the upper, and by deputy in the lower, exchequer.

The business of the ancient exchequer was primarily financial, although we know that some judicial business was done there and that the court of common pleas was derived from it rather than from the curia proper. The principal accountants were the sheriffs, who were bound, as the king’s principal financial agents in each county, to give an account of their stewardship twice a year, at the exchequers of Easter and Michaelmas. Half the annual revenue was payable at Easter, and at Michaelmas the balance was exacted, and the accounts made up for the year, and formally enrolled on the pipe roll. The fixed revenue consisted of the farms of the king’s demesne lands within the counties, of the county mints, and of certain boroughs (see BOROUGH) which paid annual sums as the price of their liberties. Danegeld was also regarded as fixed revenue, though after the accession of Henry II. it was not frequently levied. There were also rents of assarts and purprestures and mining and other royalties. The casual revenue consisted of the profits of the feudal incidents (escheat, wardship and marriage), of the profits of justice (amercements, and goods of felons and outlaws), and of fines, or payments made by the king’s subjects to secure grants of land, wardships or marriages, and of immunities, as well as for the hastening and sometimes the delaying of justice. Besides this, there were the revenues arising from aids and scutages of the king’s military tenants, tallages of the crown lands, customs of ports, and special “gifts,” or general assessments made on particular occasions. For the collection of all these the sheriff was primarily responsible, though in some cases the accountants dealt directly with the exchequer, and were bound to make their appearance in person on the day when the sheriff accounted.

We gather both from tradition and from the example of the Scottish exchequer that the farms of demesne lands were originally paid in kind, by way of purveyance for the royal household, and although such farms are expressed even in Domesday Book in terms of money, the tradition that there was a system of customary valuation is a sufficient explanation, and not of itself incredible. At some date, possibly under the administration of Roger of Salisbury, the inconvenience of this arrangement led to the substitution of money payments at the exchequer. The rapid deterioration of a small silver coinage led to successive efforts to maintain the value of these payments, first by a “scale” deduction of 6d. in the £ for wear, then by the substitution of payment by weight for payment by tale, and finally by the reduction of most of such payments to their pure silver value by means of an assay, a process originally confined to payments from particular manors. Only the farms of counties, however, were so treated, and not all of those. The amount to be deducted in these cases was settled by the weighing and assaying of a specimen pound of silver in the presence of the sheriff by the pesour and the melter in the lower exchequer. The casualrevenue was paid by tale, and for the determination of its amount it was necessary to have copies of all grants made in the chancery on which rents were reserved, or fines payable. These were known first ascontrabreviaand later asoriginalia; the profits of justice were settled by the delivery of “estreats” from the justices, while for certain minor casualties the oath of the sheriff was at first the only security. At a later date many of them were determined by copies of inquisitions sent in from the chancery. All this business might be transacted anywhere in England, and though convenience placed the exchequer first at Winchester (where the treasury was), and afterwards usually at Westminster, it held occasional sessions at other towns even in the 14th century.

The Angevin exchequer, described by Richard the Treasurer, remained the ideal of the institution throughout its history, and the lineaments of the original exemplar were never completely effaced; but the rapid increase both of financial and judicial business led to a multiplication of machinery and a growing complexity of constitution. Even in the time of Henry II. we gather that the great officers of state, except the treasurer and chancellor, commonly attended by deputy. In the reign of Henry III. the chancellor had also ceased to attend, and his clerk acquired the title of chancellor of the exchequer. To the same period belongs the institution of the king’s and lord treasurer’s remembrancers. These at first had common duties and kept duplicate rolls, but by the ordinance of 1323 their functions were differentiated. Henceforward the king’s remembrancer was more particularly concerned with the casual, and the lord treasurer’s remembrancer with the fixed revenue. The former put all debts in charge, while the latter saw to their recovery when they had found their way on to the great roll. Hence the preliminary stages of each account, the receiving and registering of the king’s writs to the treasurer and barons, and the drawing up of all particulars of account, lay with the king’s remembrancer, and he retained the corresponding vouchers. The lord treasurer’s remembrancer exacted the “remanets” of such accounts as had been enrolled, as well as reserved rents and fixed revenue, and so became closely connected with the clerk of the pipe. Before the end of the 14th century these three offices had already crystallized into separate departments.

In the meantime the increasing length and variety of accounts, as well as the growth of judicial business, had led to various efforts at reform. As early as 22 Henry II. it became necessary to remove from the great roll the debts which it seemed hopeless to levy, and further ordinances to the same end were made by statute in 54 Henry III. and in 12 Edward I. By this last a special “exannual roll” was established in which the “desperate debts” were recorded, in order that the sheriff might be reminded of them yearly without their overloading the great roll. But the largest accession of financial business arose from the “foreign accounts,” that is to say, the accounts of national services, which did not naturally form part of the account of any county. These did not in the reign of Henry II. form a part of the exchequer business. Such expenses as appear on the pipe roll were paid by the sheriffs, or by the bailiffs of “honours”; payments out of the treasury itself would only appear on the receipt and issue rolls, and the “spending departments” probably drew their supplies from the camera curie, and not directly from the exchequer. In the course of the 13th century the exchequer gradually acquired partial control of these national accounts. Even in 18 Henry II. there is an account for the forests of England, and soon the mint, the wardrobe and the escheators followed. The undated statute of the exchequer (probably about 1276) provides for escheators, the earldom of Chester, the Channel Islands, the customs and the wardrobe. During the reign of Edward I., the wardrobe account became unmanageable, since it not only financed the household, army, navy and diplomatic service, but raised money on the customs independently of the exchequer. The reform of 1323-1326, due to Walter de Stapledon, in remedying this state of things, greatly increased the number of “foreign accounts” by making the great wardrobe (the storekeeping department), the butler, purveyors, keepers of horses or of the stud, the clerk of the “hamper” of the chancery (who took the fees for the great seal), and the various ambassadors, directly accountable to the exchequer. At the same time the sheriffs’ accounts were expedited by the further simplification of the great roll, and by appointing a special officer, the “foreign apposer,” to take the account of the “green wax,” or estreats, so that two accounts could go on at once. Another baron (the 5th or cursitor baron) was appointed, and the whole business of foreign accounts was transferred to a separate building where one baron and certain auditors spent their whole time in settling the balances due on the accounts already mentioned, as well as those of castles, &c. , not let to farm, Wales, Gascony, Ireland, aids (clerical and lay), temporalities of vacant bishoprics, abbeys, priories and dignities, mines of silver and tin, ulnage and so forth. These balances were accounted for in the exchequer itself, and entered on the pipe roll, but the preliminary accounts were filed by the king’s remembrancer, and enrolled separately by the treasurer’s remembrancer as a supplement to the pipe roll.

The next important change, about the end of the 15th century, was the gradual substitution of special auditors appointed by the crown, known as the auditors of the prests (the predecessors of the commissioners for auditing public accounts), for the auditors of the exchequer. Accounts when passed by them were presented in duplicate and “declared” before the treasurer, under-treasurer and chancellor. Of the two copies, one, on paper, was retained by the auditors, the other, on parchment, was successively enrolled by the king’s and lord treasurer’s remembrancers, and finally by the clerk of the pipe, to secure the levying of any “remanets” or “supers” by process of the exchequer.

Besides the two great difficulties of the postponement of financial to legal business, and of preventing the sheriffs from exacting the same debt twice, the exchequer was, as has been seen, hampered in its functions by the interference of other departments in financial matters. Its own branches even acquired a certain independence. The exchequer of the Jews, which came to an end in 18 Edward I., was such a branch. In 27 Henry VIII. the court of augmentations was established to deal with forfeited lands of monasteries. This was followed in 32 & 33 Henry VIII. by the courts of first-fruits and tenths and of general surveyors. These were reabsorbed by the exchequer in 1 Mary, but remained as separate departments within it. But the development of the treasury, which succeeded to the functions of the camera curie or the king’s chamber, ultimately reduced the administrative functions of the exchequer to unimportance, and the audit office took over its duties with regard to public accounts. So that when the statute of 3 & 4 William IV. cap. 99, removed the sheriff’s accounts also from its competence, and brought to an end the series of pipe rolls which begins in 1130, the ancient exchequer may be said to have come to an end.

(C. J.)

In 1834 an act was passed abolishing the old offices of the exchequer, and creating a new exchequer under a comptroller-general, the detailed business of payments formerly made at the exchequer being transferred to the paymaster-general, whose office was further enlarged in 1836 and 1848. And in 1866, as the result of a select committee reporting unfavourably on the system of exchequer control as established in 1834, the exchequer was abolished altogether as a distinct department of state, and a new exchequer and audit department established.

The ancient term exchequer now survives mainly as the official title of the national banking account of the United Kingdom. This central account is commonly called the exchequer, and its statutory title is “His Majesty’s Exchequer.” It may also be described with statutory authority as “The Account of the Consolidated Fund of Great Britain and Ireland.” This account is, in fact, divided between the Banks of England and Ireland. At the head office of each of these institutions receipts are accepted and payments made on account of the exchequer; but in published documents the two accounts areconsolidated into one, the balances only at the two banks being shown separately.

Operations affecting the exchequer are regulated by the Exchequer and Audit Departments Act 1866. Section 10 prescribes that the gross revenue of the United Kingdom (less drawbacks and repayments, which are not really revenue) is payable, and must sooner or later be paid into the exchequer. Section 11 directs that payments should be made from the fund so formed to meet the current requirements of spending departments. Sections 13, 14, 15 lay down the conditions under which money can be drawn from the exchequer. Drafts on the exchequer require the approval of an officer independent of the executive government, the comptroller and auditor-general. But the description of the formal procedure required by statute cannot adequately express the actual working of the system, or the part it plays in the national finance. The simplicity of the system laid down by the act of 1866 has been disturbed by the diversion of certain branches or portions of revenue from the exchequer to “Local Taxation Accounts,” under a system initiated by the Local Government Act 1888, and much extended since.

While the exchequer is, as already stated, the central account, it is not directly in contact with the details of either revenue or expenditure. As regards revenue, the produce of taxes and other sources of income passes, in the first instance, into the separate accounts of the respective receiving departments—mainly, of course, those of the customs, inland revenue and post office. A not inconsiderable portion is received in the provinces, and remitted to London or Dublin by bills or otherwise, and the ultimate transfers to the exchequer are made (in round sums) from the accounts of the receiving departments in London or in Dublin. Thus, there are always considerable sums due to the exchequer by the revenue departments; on the other hand, as floating balances are (for the sake of economy) used temporarily for current expenses, there are generally amounts due by the exchequer to the receiving departments; such cross claims are adjusted periodically, generally once a month. The finance accounts of the United Kingdom show the gross amounts due to the exchequer from the departments, and likewise the amounts payable out of the gross revenue in priority to the claim of the exchequer. On the expenditure side a similar system prevails. No detailed payments are made direct from the exchequer, but round sums are issued from it to subsidiary accounts, from which the actual drafts for the public services are met. For instance, the interest on the national debt is paid by the Bank of England from a separate account fed by transfers of round sums from the exchequer as required. Similarly, payments for army, navy and most civil services are met by the paymaster-general out of an account of his own, fed by daily transfers from the exchequer.

This system has two noticeable effects. Firstly, it secures the simplicity and finality of the exchequer accounts, and therefore of all ordinary statements of national finance. Every evening the chancellor of the exchequer can tell his position so far as the exchequer is concerned; on the first day of every quarter the press is able to comment on the national income and expenditure up to the evening before. The annual account is closed on the evening of the 31st of March, and there can be no reopening of the budget of a past year such as may occur under other financial systems. The second effect of the system is to introduce a certain artificiality into the financial statements. Actual facts cannot be reduced to the simplicity of exchequer figures; there is always (as already explained) revenue received by government which has not yet reached the exchequer; and there must always be a considerable outstanding liability in the form of cheques issued but not yet cashed. The suggested criticism is, however, met if it can be shown that, on the whole, the differences between the true revenue and the exchequer receipts, or between the true (or audited) expenditure and the exchequer issues, are not, taking one year with another, relatively considerable. The following figures (000’s omitted) illustrate this point:—

Expenditure.

Revenue.

Surplus.

The third column in the above shows the price which has to be paid (in the form of discrepancies between facts and figures) for the simplicity secured to statements and records of the national finance by the present system embodied in the term exchequer. Probably few will think the price too high in consideration of the advantages secured.

The principal official who derives a title from the exchequer in its living sense is, of course, the chancellor of the exchequer. He is the person named second in the patent appointing commissions for executing the office of lord high treasurer of Great Britain and Ireland; but he is appointed chancellor of the exchequer for Great Britain and chancellor of the exchequer for Ireland by two additional patents. Although, in fact, the finance minister of the United Kingdom, he has nostatutorypower over the exchequer apart from his position as second commissioner of the treasury; but in virtue of his office he is by statute master of the mint, senior commissioner for the reduction of the national debt, a trustee of the British Museum, an ecclesiastical commissioner, a member of the board of agriculture, a commissioner of public works and buildings, local government, and education, a commissioner for regulating the offices of the House of Commons, and has certain functions connected with the office of the secretary of state for India. The only other exchequer officer requiring mention is thecomptroller and auditor-general, whose functions as comptroller-general of the exchequer have been already described.

The ancient name of the national banking account has been attached to two of the forms of unfunded national debt. Exchequer bills, which date from the reign of William and Mary (they took the place of the tallies, previously used for the same purpose), became extinct in 1897, but exchequer bonds (first issued by Mr Gladstone in 1853) still possess a practical importance. An exchequer bond is a promise by government to pay a specified sum after a specified period, generally three or five years, and meanwhile to pay interest half-yearly at a specified rate on that sum. Government possesses no general power to issue exchequer bonds; such power is only conferred by a special act, and for specified purposes; but when the power has been created, exchequer bonds issued in pursuance of it are governed by general statutory provisions contained in the Exchequer Bills and Bonds Act 1866, and amending acts. These acts create machinery for the issue of exchequer bonds and for the payment of interest thereon, and protect them against forgery.

Some traces may be mentioned of the ancient uses of the name exchequer which still remain. The chancellor of the exchequer still presides at the ceremony of “pricking the list of sheriffs,” which is a quasi-judicial function; and on that occasion he wears a robe of black silk with gold embroidery, which suggests a judicial costume. In England the last judge who was styled baron of the exchequer (Baron Pollock) died in 1897. In Scotland the jurisdiction of the barons of the exchequer was transferred to the court of session in 1856, but the same act requires the appointment of one of the judges as “lord ordinary in exchequer causes,” which office still exists. In Ireland Lord Chief Baron Palles was the last to retain the old title. A street near Dublin Castle is called Exchequer Street, recalling the separate Irish exchequer, which ceased in 1817. The old term also survives in the full title of the treasury representative in Scotland, which is “The King’s and the Lord Treasurer’s Remembrancer in Exchequer,” while his office in the historic Parliament Square is styled “Exchequer Chambers.”

(S. E. S.-R.)

Bibliography.—For the early exchequer Thomas Madox’sHistory and Antiquities of the Exchequer(London, 1711) remains the standard authority, and in it theDialogus de Scaccarioof Richard the Treasurer (1179) was first printed (edited since by A. Hughes, C.G. Crump and C. Johnson, Oxford, 1902). The publications of the Pipe Roll Society (London, 1884 et seq.), the Pipe Rolls and Chancellor’s Roll, printed by the Record Commission (London, 1833 and 1844), and H. Hall’s edition of theReceipt Roll of the Exchequer 31 Henry II.(London, 1899) should also be consulted. A popular account is in H. Hall’sCourt Life under the Plantagenets(London, 1901), and a careful study in Dr Parow’s thesis,Compotus Vicecomitis(Berlin, 1906). For the 13th and 14th centuries H. Hall’s edition of theRed Book of the Exchequer(London, Rolls Series, 1896) is essential, as also the Public Record OfficeList of Foreign Accounts(London, 1900). Later practice may be gathered from the similarList and Index of Declared Accounts(London, 1893), and from such books as Sir T. Fanshawe’sPractice of the Exchequer Court, written aboutA.D.1600 (London, 1658); Christopher Vernon’sThe Exchequer Opened(London, 1661), or Sir Geoffrey Gilbert’sTreatise on the Court of Exchequer(London, 1758), as well as from the statutes abolishing various offices in the exchequer. H. Hall’sAntiquities of the Exchequer(London, 1891) gives many interesting details of various dates. For the Scottish exchequerThe Exchequer Rolls of Scotland(Edinburgh, 1878 et seq.) should be consulted, while Gilbert’s book noted above gives some details on that of Ireland. See also Appendix 13 to the great account ofPublic Income and Expenditure from 1688 to 1869, in three volumes, prepared for parliament by H.W. Chisholm (1869); and for sidelights on the working of the office from 1825 to 1866 the reminiscences of the same author (the last chief clerk of the exchequer) inTemple Bar(January to April 1891).

EXCISE(derived through the Dutch,excijsoraccijs, possibly from Late Lat.accensare,—ad, to, andcensus, tax; the word owes something to a confusion withexcisum, cut out), a term now well known in public finance, signifying a duty charged on home goods, either in the process of their manufacture, or before their sale to the home consumers. This form of taxation implies a commonwealth somewhat advanced in manufactures, markets and general riches; and it interferes so directly with the industry and liberty of the subject that it has seldom been introduced save in some supreme financial exigency, and has as seldom been borne, even after long usage, with less than the ordinary impatience of taxation. Yet excise duties can boast a respectable antiquity, having a distinct parallel in thevectigal rerum venalium(or toll levied on all commodities sold by auction, or in public market) of the Romans. But the Roman excise was mild compared with that of modern nations, having never been more thancentesima, or 1%, of the value; and it was much shorter lived than the modern examples, having been first imposed by Augustus, reduced for a time one-half by Tiberius, and finally abolished by Caligula,A.D.38, so that the Roman excise cannot have had a duration of much more than half a century. Its remission must have been deemed a great boon in the marts of Rome, since it was commemorated by the issue of small brass coins with the legendRemissis Centesimis, specimens of which are still to be found in collections.

The history of this branch of revenue in the United Kingdom dates from the period of the civil wars, when the republican government, following the example of Holland, established, as a means of defraying the heavy expenditure of the time, various duties of excise, which the royalists when restored to power found too convenient or too necessary to be abandoned, notwithstanding their origin and their general unpopularity. On the contrary, they were destined to be steadily increased both in number and in amount. It is curious that the first commodities selected for excise were those on which this branch of taxation, after great extension, had again in the period of reform and free trade been in a manner permanently reduced, viz. malt liquors, and such kindred beverages as cider perry and spruce beer. The other excise duties remaining are chiefly in the form of licences, such as to kill game and to use and carry guns, to sell gold and silver plate, to pursue the business of appraisers or auctioneers, hawkers or pedlars, pawnbrokers or patent-medicine vendors, to manufacture tobacco or snuff, to deal in sweets or in foreign wines, to make vinegar, to roast malt, or to use a still in chemistry or otherwise. It may be presumed that the policy of the licence duties was at first not so much to collect revenue, though in the aggregate they yielded a large sum, as to guard the main sources of excise, and to place certain classes of dealers, by registration and an annual payment to the exchequer, under a direct legal responsibility. The excise system of the United Kingdom as now pruned and reformed, however, while still the most prolific of all the sources of revenue, is simple in process, and is contentedly borne as compared with what was the case in the 18th, and the beginning of the 19th century. The wars with Bonaparte strained the government resources to the uttermost, and excise duties were multiplied and increased in every practicable form. Bricks, candles, calico prints, glass, hides and skins, leather, paper, salt, soap, and other commodities of home manufacture and consumption were placed, with their respective industries, under excise surveillance and fine. When the duties could no longer be increased in number, they were raised in rate. The duty on British spirits, which had begun at a few pence per gallon in 1660, rose step by step to 11s. 8¼d. per gallon in 1820; and the duty on salt was augmented to three or fourfold its value.

The old unpopularity of excise, though now somewhat out of date, must have had real enough grounds. It breaks out in English literature, from songs and pasquinades to grave political essays and legal commentaries. Blackstone, in quoting the declaration of parliament in 1649 that “excise is the most easy and indifferent levy that can be laid upon the people,” adds on his own authority that “from its first original to the present time its very name has been odious to the people of England” (book i. cap. 8, tenth edition, 1786); while the definition of “excise” gravely inserted by Dr Johnson in theDictionary, at the imminent risk of subjecting the eminent author to a prosecution for libel—viz. “a hateful tax levied upon commodities, and adjudged not by the common judges of property, but wretches hired by those to whom excise is paid”—can hardly be ever forgotten.

The duties of excise in the United Kingdom were, until the passing of the Finance Act 1908, under the control of thecommissioners of inland revenue; they are now under the control of the commissioners of customs; the amount raised, apart from changes in the rate, shows a fairly constant tendency to increase, and is usually regarded as one of the best tests of the prosperity of the working classes.

Thespirit dutyis levied according to the quantity of “proof spirit” contained in the product of distillation, and the charge is taken at three different points in the process of manufacture, the trader being liable for the result of the highest of the three calculations. What is known as “proof spirit” is obtained by mixing nearly equal weights of pure alcohol and water, the quantity of pure alcohol being in bulk about 57% of the whole. Owing to the high rate of duty as compared with the volume and intrinsic value of the spirits, the whole process of manufacture is carried on under the close supervision of revenue officials. All the vessels used are measured by them and are secured with revenue locks; the premises are under constant survey; and notice has to be given by the distiller of the materials used and of the several stages of his operations. Though the charge for duty is raised at the time when the process of distillation is completed, the duty is not actually paid until the spirits are required for consumption. In the meanwhile they may be retained in an approved “warehouse,” which is also subject to close supervision.

Thebeer dutydates from 1880, in which year it was substituted for the duty on malt. The specific gravity of the worts depends chiefly on the amount of sugar which they contain, and is ascertained by the saccharometer.

Exciselicencesmay be divided into—(a) licences for the sale or manufacture of excisable liquors, (b) licences for other trades, such as tobacco dealers or manufacturers, auctioneers, pawnbrokers, &c. , (c) licences for male servants, carriages, motors and armorial bearings, and (d) gun, game and dog licences. Nearly the whole of the licence duties is paid over to the local taxation account.

Therailway passenger duty, which was made an excise duty by the Railway Passenger Duty Act 1847, applies only to Great Britain. It is levied on all passenger fares exceeding 1d. per mile, the rate being 2% on urban and 5% on other traffic.

The other items which go to make up the excise revenue are the charges on deliveries from bonded warehouses, and the duties on coffee mixture labels and on chicory.

For more detailed information reference should be made to Highmore’sExcise Laws, and the annual reports of the commissioners of inland revenue, especially those issued in 1870 and 1885. See alsoTaxation;English Finance.

EXCOMMUNICATION(Lat.ex, out of, away from;communis, common), the judicial exclusion of offenders from the rights and privileges of the religious community to which they belong. The history of the practice of excommunication may be traced through (1) pagan analogues, (2) Hebrew custom, (3) primitive Christian practice, (4) medieval and monastic usage, (5) modern survivals in existing Christian churches.

1. Among pagan analogues are the Gr.χερνίβων εἴργεσθαι(Demosth. 505, 14), the exclusion of an offender from purification with holy water. This exclusion was enforced in the case of persons whose hands were defiled with bloodshed. Its consequences are described Aesch.Choëph.283,Eum.625 f., Soph.Oed. Tyr.236 ff. The Romanexsecratioand dirisdevotiowas a solemn pronouncement of a religious curse by priests, intended to call down the divine wrath upon enemies, and to devote them to destruction by powers human and divine. The Druids claimed the dread power of excluding offenders from sacrifice (Caes.B.G.vi. 13). Primitive Semitic customs recognize that when persons are laid under a ban or taboo (ḥerem) restrictions are imposed on contact with them, and that the breach of these involves supernatural dangers. Impious sinners, or enemies of the community and its god, might be devoted to utter destruction.

2.Hebrew Custom.—In a theocracy excommunication is necessarily both a civil and a religious penalty. The word used in the New Testament to describe an excommunicated person,ἀνάθεμα(1 Cor. xvi. 22, Gal. i. 8-9, Rom. ix. 3), is the Septuagint rendering of the Hebrewḥerem. The word means “set apart” (cf. harem), and does not distinguish originally between things set apart because devoted to God and things devoted to destruction. Lev. xxvii. 16-34 defines the law for dealing with “devoted” things; according to v. 28 “No devoted thing that a man shall devote unto the Lord, of all that he hath, whether of man or beast, or of the field of his possession, shall be sold or redeemed. None devoted shall be ransomed, he shall surely be put to death.” As in Greece and Rome whole cities or nations might be devoted to destruction by pronouncement of a ban (Numbers xxi. 2, 3, Deut. ii. 34, iii. 6, vii. 2). Occasionally Israelites as well as aliens fall under the curse (Judg. xxi. 5, 11). A milder form of penalty was the temporary separation or seclusion (niddah) prescribed for ceremonial uncleanness. This was the ordinary form of religious discipline. In the time of Ezra the Jewish “magistrates and judges” among their ecclesiastico-civil functions have the right of pronouncing sentence whether it be unto death, or to “rooting out,” or to confiscation of goods, or to imprisonment (Ezra vii. 26). There is also a lighter form of excommunication which “devotes” the goods of an offender, but only separates him from the congregation. Both major and minor kinds of excommunication are recognized by the Talmud. The lesser (niddah) involved exclusion from the synagogue for thirty days, and other penalties, and might be renewed if the offender remained impenitent. The major excommunication (ḥerem) excluded from the Temple as well as the synagogue and from all association with the faithful. Spinoza was excommunicated (July 16, 1656) for contempt of the law. Seldon (De jure nat. et gen., iv. 7) gives the text of the curse pronounced on the culprit. TheExemplar Humanae Vitaeof Uriel d’Acosta also deserves reference. The practice of the Jewish courts in New Testament times may be inferred from certain passages in the Gospels. Luke vi. 22, John ix. 22, xii. 42 indicate that exclusion from the synagogue was a recognized penalty, and that it was probably inflicted on those who confessed Jesus as the Christ. John xvi. 2 (“Whosoever killeth you,” &c. ) may point to the power of inflicting the major penalty. The Talmud itself says that the judgment of capital cases was taken away from Israel forty years before the destruction of the Temple. “Forty” is probably a round number without historical value, but the circumstance recorded by this tradition and confirmed by the evangelist’s account of the trial of Jesus is historical, and is to be regarded as one of several restrictions imposed on the Jewish courts in the time of the Roman procurators.

3.Primitive Christian Practice.—The use of excommunication as a form of Christian discipline is based on the precept of Christ and on apostolic practice. The general principles which govern the exclusion of members from a religious community may be gathered from the New Testament writings. Matt. xviii. 15-17 prescribes a threefold admonition, first privately, then in the presence of witnesses (cf. Titus iii. 10), then before the church. This is a graded procedure as in the Jewish synagogue and makes exclusion a last resort. Nothing is said as to the nature and effects of excommunication. The tone of the passage when compared with the disciplinary methods of the synagogue indicates that its purpose was to introduce elements of reason and moral suasion in place of sterner methods. Its object is rather the protection of the church than the punishment of the sinner. The offender is only treated as a heathen and publican when the purity and safety of the church demand it. In thelocus classicuson this subject (1 Cor. v. 5) Paul refers to a formal meeting of the Corinthian church at which the incestuous person is “delivered unto Satan for the destruction of the flesh that the spirit may be saved in the day of the Lord Jesus.” These are mysterious words implying (1) a formal ecclesiastical censure, (2) a physical penalty, (3) the hope of a spiritual result. The form of penalty which would meet these conditions is not explained. There is a reference in 2 Cor. ii. 6-11 to a case of discipline which may or may not be the same. If it be the same it indicates that the excommunication had not been final; the offender had been received back. If it be not the same it shows the Corinthianchurch exercising discipline independently of apostolic advice. Up to this point there is no established formal practice. 1 Tim. i. 20 (“Hymenaeus and Alexander whom I delivered unto Satan that they might be taught not to blaspheme”) seems to refer to an excommunication, but it does not appear whether the apostle had acted as representing a church, nor is there anything to explain the exact consequences or limits of the deliverance to Satan. 1 Cor. xvi. 22, Gal. i. 8, 9, Rom. ix. 3 refer to the practice of regarding a person as anathema. Taking these passages as a whole they seem to point to an exclusion from church fellowship rather than to a final cutting off from the hope of salvation. In the pastoral letters there is already a formal and recognized method of procedure in cases of church discipline. 1 Tim. v. 19, 20 requires two or three witnesses in the case of an accusation against an elder, and a public reproof. Tit. iii. 20 recognizes a factious spirit as a reason for excommunication after two admonitions (cf. Tim. vi. and 2 John v. 10). In 3 John v. 9-10 Diotrephes appears to have secured an excommunication by the action of a party in the church. It is clear from these illustrations that within the New Testament there is development from spontaneous towards strictly regulated methods; also that the use of excommunication is chiefly for disciplinary and protective rather than punitive purposes. A process which is intended to produce penitence and ultimate restoration cannot at the same time contemplate handing the offender over to eternal punishment.

4.Medieval and Monastic Usage.—The writings of the church Fathers give sufficient evidence that two degrees of excommunication, theἀφορισμόςand theἀφορισμὸς παντελής, as they were generally called, were in use during, or at least soon after, the apostolic age. The former, which involved exclusion from participation in the eucharistic service and from the eucharist itself, though not from the so-called “service of the catechumens,” was the usual punishment of comparatively light offences; the latter, which was the penalty for graver scandals, involved “exclusion from all church privileges,”—a vague expression which has sometimes been interpreted as meaning total exclusion from the very precincts of the church building (inter hiemantes orare) and from the favour of God (Bingham,Antiquities of Christian Church, xvi. 2. 16). For some sins, such as adultery, the sentence of excommunication was in the 2nd century regarded asπαντελήςin the sense of being irrevocable. Difference of opinion as to the absolutely “irremissible” character of mortal sins led to the important controversy associated with the names of Zephyrinus, Tertullian, Calistus, Hippolytus, Cyprian and Novatian, in which the stricter and more montanistic party held that for those who had been guilty of such sins as theft, fraud, denial of the faith, there should be no restoration to church fellowship even in the hour of death. On this point the provincial synods of Illiberis (Elvira) in 305 and of Ancyra in 315 subsequently came to conflicting decisions, the council of Elvira forbidding the reception of offenders into communion during life, and the council of Ancyra fixing a limit to the penalty in the same cases. But the excommunication was on all hands regarded as being “medicinal” in its character. It is noteworthy that the wordἀνάθεμαhad fallen into disuse about the beginning of the 4th century, and that, throughout the same period, no instance of the judicial use of the phraseπαραδοῦναι τῷ Σατανᾷcan be found.

A new chapter in the history of the church censure may be said to have begun with the publication of those imperial edicts against heresy, the first of which,De summa trinitate et fide catholica, dates from 380. Till then exclusion from church privileges had been a spiritual discipline merely; thenceforward it was to expose a man to serious temporal risks. Excommunication still continued to be occasionally used in the spirit of genuine Christian fidelity, as by Ambrose in the case of Theodosius himself (390); but the temptation to wield it as an instrument of secular tyranny too often proved to be irresistible. The church fell back on carnal weapons in her warfare and invoked the secular powers to uphold the ecclesiastical. In the formula used by Synesius (410) which is to be found in Bingham’sAntiquities, we already find the attention of magistrates specially called to the censured person. The history of the next thousand years shows that the magistrates were seldom slow to respond to the appeal. Even the hastiest survey of that long and interesting period enables the student to notice a marked development in the theory and practice of excommunication. One or two points may be specially noted. (1) When the Empire became nominally Christian and the quality of the church life was sacrificed to the quantity of its adherents, the original character of excommunication was lost. The power of excommunication was transferred from the community to the bishop, and was liable to abuse from personal motives: Gregory the Great rebukes a bishop for using for private ends power conferred for the public good (Epist.ii. 34). Excommunication became a common penalty applied in numberless cases (see thePenitentialof Archbishop Theodosius: Haddan and Stubbs,Councils and Documents, iii. 1737), and was invested with superstitious terrors. (2) While it had been held as an undoubted principle by the ancient church that this sentence could only be passed on living individuals whose fault had been distinctly stated and fully proved, we find the medieval church on the one hand sanctioning the practice of excommunication of the dead (Morinus,De poenit.x. c. 9), and, on the other hand, by means of the papal interdict, excluding whole countries and kingdoms at once from the means of grace. The earliest well-authenticated instance of such an interdict is that which was passed (998) by Pope Gregory V. on France, in consequence of the contumacy of King Robert the Wise. Other instances are those laid respectively on Germany in 1102 by Gregory VII. (Hildebrand), on England in 1208 by Innocent III., on Rome itself in 1155 by Adrian IV. (3) While in the ancient church the language used in excommunicating had been carefully measured, we find an amazing recklessness in the phraseology employed by the medieval clergy. The curse of Ernulphus or Arnulphus of Rochester (c.1100), often quoted by students of English literature, is a very fair specimen of that class of composition. With it may be compared the formula transcribed by Dr Burton in hisHistory of Scotland(iii. 317 ff.). To the spoken word was added the language of symbol. By means of lighted candles violently dashed to the ground and extinguished the faithful were graphically taught the meaning of the greater excommunication—though in a somewhat misleading way, for it is a fundamental principle of the canon law thatdisciplina est excommunicatio, non eradicatio. The first instance, however, of excommunication by “bell, book and candle” is comparatively late (c.1190).

5.Modem Survivals in Existing Christian Churches.—At the Reformation the necessity for church discipline did not cease to be recognized; but the administration of it in many Reformed churches has passed through a period of some confusion. In some instances the old episcopal power passed more or less into the hands of the civil magistrate (a state of matters which was highly approved by Erastus and his followers), in other cases it was conceded to the presbyterial courts. In the Anglican Church the bishops (subject to appeal to the sovereign) have the right of excommunicating, and their sentence, if sustained, may in certain cases carry with it civil consequences. But this right is in practice never exercised. In the law of England sentence of excommunication, upon being properly certified by the bishop, was followed by the writde excommunicato capiendofor the arrest of the offender. The statute 5 Eliz. c. 23 provided for the better execution of this writ. By the 53 Geo. III. c. 127 (which does not, however, extend to Ireland) it was enacted that “excommunication, together with all proceedings following thereupon, shall in all cases, save those hereafter to be specified, be discontinued.” Disobedience to or contempt of the ecclesiastical courts is to be punished by a new writ,de contumace capiendo, to follow on the certificate of the judge that the defender is contumacious and in contempt. Sect. 2 provides that nothing shall prevent “any ecclesiastical court from pronouncing or declaring persons to be excommunicate on definite sentences pronounced as spiritual censures for offences of ecclesiastical cognizance.” No persons so excommunicatedshall incur any civil penalty or incapacity whatever, save such sentence of imprisonment, not exceeding six months, as the court shall direct and certify to the king in chancery.

In the churches which consciously shaped their polity at or after the Reformation the principle of excommunication is preserved in the practice of church discipline. Calvin devotes a chapter in theInstitutes(bk. iv. chap. xii.) to the “Discipline of the Church; its Principal Use in Censure and Excommunication.” The three ends proposed by the church in such discipline are there stated to be, (1) that those who lead scandalous lives may not to the dishonour of God be numbered among Christians, seeing that the church is the body of Christ; (2) that the good may not be corrupted by constant association with the wicked; (3) that those who are censured or excommunicated, confounded with shame, may be led to repentance. He differentiates decisively between excommunication and anathema. “When Christ promises that what his ministers bind on earth shall be bound in heaven, he limits the power of binding to the censure of the church; by which those who are excommunicated are not cast into eternal ruin and condemnation, but by having their life and conduct condemned are also certified of their final condemnation unless they repent. For excommunication differs from anathema: anathema which ought to be very rarely, or never, resorted to, in precluding all pardon, execrates a person, and devotes him to eternal perdition: whereas excommunication rather censures and punishes his conduct. Yet in such a manner by warning him of his future condemnation it recalls him to salvation” (Inst.bk. iv. chap. xii. 10). The Reformed churches in England and America accepted the distinction between public and private offences. The usual provision is that private offences are to be dealt with according to the rule in Matt. v. 23-24, xviii. 15-17; public offences are to be dealt with according to the rule in 1 Cor. v. 3-5, 13. The public expulsion or suspension of the offender is necessary for the good repute of the church, and its influence over the faithful members. The expelled member may be readmitted on showing the fruits of repentance.

In Scotland three degrees of church censure are recognized—admonition, suspension from sealing ordinances (which may be called temporary excommunication), and excommunication properly so-called. Intimation of the last-named censure may occasionally (but very rarely) be given by authority of a presbytery in a public and solemn manner, according to the following formula:—“Whereas thou N. hast been by sufficient proof convicted (here mention the sin) and after due admonition and prayer remainest obstinate without any evidence or sign of true repentance: Therefore in the name of the Lord Jesus Christ, and before this congregation, I pronounce and declare thee N. excommunicated, shut out from the communion of the faithful, debar thee from privileges, and deliver thee unto Satan for the destruction of thy flesh, that thy spirit may be saved in the day of the Lord Jesus.” This is called the greater excommunication. The congregation are thereafter warned to shun all unnecessary converse with the excommunicate (seeForm of Process, c. 8). Formerly excommunicated persons were deprived of feudal rights in Scotland; but in 1690 all acts enjoining civil pains upon sentences of excommunication were finally repealed (Burton’sHistory, vii. 435).

The question whether the power of excommunication rests in the church or in the clergy has been an important one in the history of English and American churches. Hooker lays down (Survey, pt. 3, pp. 33-46) four necessary conditions for the execution of a sentence involving church discipline. “(1) The cause exactly recorded is fully and nakedly to be presented to the consideration of the congregation. (2) The elders are to go before the congregation in laying open the rule so far as reacheth any particular now to be considered, and to express their judgment and determination thereof, so far as appertains to themselves. (3) Unless the people be able to convince them of errors and mistakes in their sentence, they are bound to joyn their judgment with theirs to the compleating of the sentence. (4) The sentence thus compleatly issued is to be solemnly passed and pronounced upon the delinquent by the ruling Elder whether it be of censure or excommunication.” In this passage it is clear that the effective power of discipline is regarded as being wholly in the power of the individual church or congregation. Hooker expressly denies the power of synods to excommunicate: “that there should be Synods, which havepotestatem juridicamis nowhere proved in Scripture because it is not a truth” (Survey, pt. 4, pp. 48, 49).

The confession of faith issued by the London-Amsterdam church (the original of the Pilgrim Fathers’ churches) in 1596 declares that the Christian congregation having power to elect its minister has also power to excommunicate him if the case so require (Walker,Creeds and Platforms of Congregationalism, p. 66). In 1603 the document known as “Points of Difference” (i.e.from the established Anglicanism) submitted to James I. sets forth: “That all particular Churches ought to be so constituted as, having their owne peculiar Officers, the whole body of every Church may meet together in one place, and jointly performe their duties to God and one towards another. And that the censures of admonition and excommunication be in due manner executed, for sinne, convicted, and obstinately stood in. This power also to be in the body of the Church whereof the partyes so offending and persisting are members.” TheCambridge Platformof 1648 by which the New England churches defined their practice, devotes ch. xiv. to “excommunication and other censures.” It follows in the main the line of Hooker and Calvin, but adds (§ 6) an important definition: “Excommunication being a spirituall punishment it doth not prejudice the excommunicate in, nor deprive him of hiscivilrights, therfore toucheth not princes, or other magistrates, in point of their civil dignity or authority. And, the excommunicate being but as a publican and a heathen, heathen being lawfully permitted to come to hear the word in church assemblyes; wee acknowledg therfore the like liberty of hearing the word, may be permitted to persons excommunicate, that is permitted unto heathen. And because wee are not without hope of his recovery, wee are not to account him as an enemy but to admonish him as a brother.” The Savoy Declaration of 1658 defines the theory and practice of the older English Nonconformist churches in the section on the “Institution of Churches and the Order appointed in them by Jesus Christ” (xix.). The important article is as follows:—“The Censures so appointed by Christ, are Admonition and Excommunication; and whereas some offences are or may be known onely to some, it is appointed by Christ, that those to whom they are so known, do first admonish the offender in private: in publique offences where any sin, before all; or in case of non-amendment upon private admonition, the offence being related to the Church, and the offender not manifesting his repentance, he is to be duely admonished in the Name of Christ by the whole Church, by the Ministery of the Elders of the Church, and if this Censure prevail not for his repentance, then he is to be cast out by Excommunication with the consent of the Church.”

In contemporary English Free Churches the purity of the church is commonly secured by the removal of persons unsuitable for membership from the church books by a vote of the responsible authority.

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