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from the farmers, who, on the other hand, are entitled to full official assistance to enforce their rights.

Assessment of Taxes.—For the purposes of assessment the taxes may be divided roughly into two classes: (1) variable taxes; (2) non-variable taxes. Under the first head would be included proportional taxes dependent upon the value of the property taxed; under the second, taxes whose amount does not depend upon that value. The first class contains such revenues as the emlak verghi-si (duty on realty), ‛ashār (tithes), temettū (professional tax), &c. In all such cases the taxable values are fixed by a commission of experts, sometimes chosen by the tax-payers themselves, sometimes by the official authorities; in all cases both tax-payers and authorities are represented on the commissions, whose decisions may be appealed against, in last resort, to the council of state at Constantinople, whose decision is final. Revenues composing the second class such as the tapu (registration tax) do not vary, unless by special decree, and the assessment is automatic.

The systems, both of assessment and collection, were equitable and far from oppressive in theory. In practice they left almost everything to be desired. The officials, already too numerous and underpaid, frequently, as has been stated above, found such pay as they had far in arrear. They were therefore naturally open to bribery and corruption, with the result that, while the rich often got off almost scot free, the poor were unduly taxed, and often cruelly oppressed by the tax collectors and farmers of revenue. In all departments there ensued, thus, an alarming leakage of revenue, amounting, it was credibly estimated, to quite 40%. The new government energetically proceeded to remedy this state of affairs.

International Administration of the Ottoman Debt.—In consequence of the piling up of the exterior public debt as described above, it amounted after the issue of “general debt” in 1875 to £T190,750,000, and swallowed up annually upwards of £T10,000,000, or nearly half the revenue of the empire as it was then constituted. The revolt of various disaffected provinces brought matters to a climax; in September 1875 one-half of the service of the interest was suspended, paper certificates known as “Ramazans” (since they were issued in the Arabic month of that name) being issued for that half in lieu of cash, and in the following March it was suspended altogether. After the war with Russia, in order to obtain credit from the Imperial Ottoman Bank and local financiers, who refused any further accommodation unless their previous and further advances were amply secured, revenues known as the “six indirect contributions” were handed over to a committee of local bankers (by decree of Nov. 22, 1879), to be administered and collected directly by them. These “six indirect contributions” were the revenues from tobacco, salt, wines and spirits, stamps (commercial), certain specified fisheries, and the silk tithe in specified provinces. Two years later, partly in view of the recommendations of the Congress of Berlin, partly to overcome insuperable difficulties in obtaining any kind of credit, the sultan authorized the Sublime Porte to issue an invitation to the various bondholders' committees in Europe to send delegates to Constantinople for the purpose of negotiating a resumption of payments. These “committees” were the “Council of Foreign Bondholders” for Great Britain, the Imperial Ottoman Bank and its “group” for France, Herr S. Bleichröder for Berlin, the Credit-Anstalt and its “group” for Austria-Hungary, and the Chamber of Commerce and of Arts of Rome for Italy. The Dutch bondholders placed their interests in the hands of the British council. Russia declined to countenance the negotiations in any way. Delegates from the various committees assembled in Constantinople in the early summer of 1881. The commission formed by them in conjunction with the delegates of the Sublime Porte is more generally known as the “Valfrey-Bourke commission,” from the leading parts played by the Right Hon. R. Bourke (Lord Connemara), the British delegate, and M. Valfrey, the French delegate. The outcome of the negotiations was the issue of an imperial decree, known as the “Decree of Muharrem,” owing to its bearing the date (Turkish style) of the 28th of Muharrem (Dec. 20) 1881. By this decree the outstanding capital of the exterior debt, to which were added the Ramazan certificates above mentioned, and all interest fallen due, making a grand total of £252,800,000, was scaled down to £106,437,234 (£T117,080,958). On this reduced capital a minimum interest of 1% was to be paid, the rate of interest to be increased by quarters per cent. as the revenues set aside for the service of the reduced debt permitted. For purposes of sinking fund the old loans were combined into four groups:^[1] group i. containing the 1858 and 1862 loans, with a reduced nominal capital of £T7,902,259; group ii. the 1860, 1863, 1864 and 1872 loans, with a reduced nominal capital of £T11,265,153; group iii. the 1865, 1869 and 1873 loans, with a reduced nominal capital of £T33,915,762, and group iv. the “general debt,” of which the last issue was in 1875, with a reduced nominal capital of £T48,365,236, and the “lottery bonds” (railway loan), with a reduced nominal capital of £T15,632,548, the total of group iv. being thus £T63,997,784. As security for the service of the new reduced debt it was provided that an international council should be formed, composed of one delegate each from the bondholders of the United Kingdom, France, Germany, Austria-Hungary, Italy and Turkey, and one representing the “priority bondholders,” a term which will be explained later. On this council the Turkish government has the right of naming an imperial commissioner with “consultative voice,” i.e. no voting power, but the right to express his opinion on the proceedings of the council, who would make all reports he considered necessary to his government. The government was empowered also to name controllers to whom all the accounts of the administration should be open for inspection on demand. In all other respects the council, provided that it kept within the limits of the laws the administration of which was entrusted to it, was to be entirely independent of the Ottoman government, free to appoint and dismiss its own officials from highest to lowest, and to carry on its administration on such lines as it thought best. Proposals made by the council for the modification and improvement of the existing laws and regulations which concerned it were to receive an answer from the government within six months; this provision has remained a dead letter. Any difference between the government and the council, if not possible of adjustment, was to be settled by arbitration.

To this council, with these extended powers, was handed over the absolute administration, collection and control of the “six indirect

contributions” above enumerated, for the benefit of the bondholders, and in addition, it was to encash for the same purpose bills on the customs, to be drawn half-yearly in its favour by the minister of finance, amounting annually to £T180,000, representing the tax on Tumbēki (£T50,000) and the surplus revenue of Cyprus (£T130,000); and the Eastern Rumelian annuity, originally fixed at £T245,000, but gradually reduced by force of circumstances, until after frequent suspensions of payment it reached in 1897 the level of £T114,000, and has, since the declaration of Bulgarian independence, been definitely stopped. In order to assist the young kingdom of Bulgaria, which could only with great difficulty and with much damage to its resources have found means to indemnify Turkey for this serious breach of treaty engagements, the Russian government intervened, and proposed as compensation to the Turkish government the deferment for forty years of the annual payment (£T350,000) of the 1877 war indemnity. This proposal was accepted by the Turkish government, which undertook to continue the annual payment of £T114,000 to the public debt administration until the extinction of the debt. The public debt council consented with good grace, although the minister of finance, by omitting to consult that council during the progress of negotiations, lost sight of the fact that a sum of £T87,823 was due to the public debt administration on account of arrears of the Eastern Rumelian annuity up to December 1887, and that a further sum of £T430,741 was due by the Bulgarian to the Turkish government itself in compensation for the Rustchuk-Varna railway under the Treaty of Berlin. As pointed out by Sir Adam Block, the representative of the British and Dutch bondholders, in his report for 1908–1909, the above arrangement would have been prejudicial to the bondholders had the public debt not been “unified” (as described below) since, however, as a result of that unification, the ceded revenues now produced a sum more than sufficient for the service of the debt, it was only the surplus of revenue reverting to the government which was affected. There were further handed over, under the Muharrem decree, to the public debt council, the tribute of Bulgaria, the amount of which has never even been fixed, but as compensation for which the tobacco tithe up to a yearly amount of £T100,000 was ceded to the council in the same conditions as the “six indirect contributions”; the proportional shares (generally known as the “contributive

1. For simplicity's sake, the lottery bonds having a special treatment different from that of the rest of the loans, these groups, when the new bonds of the reduced debt were exchanged against the old bonds of the original loans, became “series” thus: Series A, group i.; series B, group ii.; series C, group iii.; series D, group iv. and lottery bonds.