That is where the whole trouble lies.

And the Governor has no power to grant them leave to tax the proprietary lands.

Not only so, but he is expressly forbidden by the terms of his commission to permit this taxation.
But the Assembly will not yield the point, nor will they consent to furnish means for the defence of the colony until this point is conceded.

That is where the deadlock comes in.

The Governor cannot yield; his powers do not permit it.