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The exact etymology of the term "boxing" is unclear. There are several competing theories, none of which is definitive. The European tradition, which has long included giving money and other gifts to those who were needy and in service positions, has been dated to the Middle Ages, but the exact origin is unknown. It may come from a custom in the late Roman/early Christian era, wherein metal boxes placed outside churches were used to collect special offerings tied to the Feast of Saint Stephen, which in the Western Church falls on the same day as Boxing Day.
In Britain, it was a custom for tradesmen to collect "Christmas boxes" of money or presents on the first weekday after Christmas as thanks for good service throughout the year. This is mentioned in Samuel Pepys' diary entry for 19 December 1663. This custom is linked to an older English tradition: Since they would have to wait on their masters on Christmas Day, the servants of the wealthy were allowed the next day to visit their families. The employers would give each servant a box to take home containing gifts and bonuses, and sometimes leftover food.
Boxing Day is a secular holiday that is traditionally celebrated on 26 December, the day after Christmas Day, which is also St. Stephen's Day, a religious holiday. However, when 26 December falls on a Sunday, Boxing Day in many places is moved to 27 December. In the UK, where Boxing Day is a bank holiday, if Boxing Day falls on a Saturday, a substitute bank holiday is given on the following Monday, but if 26 December falls on a Sunday – which means that Christmas Day, another holiday, fell on a Saturday – then the Statutory Holiday for Christmas is moved.
In Scotland, Boxing Day has been specified as an additional bank holiday since 1974, by Royal Proclamation under the Banking and Financial Dealings Act 1971.
In Ireland – when it was part of the UK – the Bank Holidays Act 1871 established the feast day of St. Stephen as a non-movable public holiday on 26 December. Since Irish Independence, the name 'Boxing Day' is used only by the authorities in Northern Ireland, which remains part of the UK. There, Boxing Day is a movable public holiday in line with the rest of the UK.
In the Australian state of South Australia, 28 December is a public holiday known as Proclamation Day and Boxing Day is not normally a public holiday. The holiday for Proclamation Day is observed on the first weekday after Christmas Day or the Christmas Day holiday. Nowadays Boxing Day is popular in Australia as the first day of a Test cricket match held at the MCG. A Test match is also often held in South Africa starting on Boxing Day.

In some Canadian provinces, Boxing Day is a statutory holiday that is always celebrated on 26 December. In Canadian provinces where Boxing Day is a statutory holiday, and it falls on a Saturday or Sunday, compensation days are given in the following week.