explained that it is difficult to increase the number of samples selected for detailed analysis as suggested, because the Govern at Chemist does not have sufficient capacity in his laboratory.
15. Head 2- General Rates. Under Section 79A of the Public Health and Urban Services Ordinance the management and control of the public markets shall be vested in the Urban Council in respect of the urban areas and in the Director of Urban Services (Director of Regional Services with effect from April 1985) in respect of the New Territories. Following discussions within the Rating and Valuation Department in 1978 on the question of whether markets managed and controlled by the Urban Council and the Urban Services Department should be assessed to rates, it was decided they should, although it was recognized that there might be some difficulties, and it was agreed at a Rating Valuation Conference of the Rating and Valuation Department in August 1978 that necessary arrangements would be made to rate the public markets with effect from April 1981.
16. At a subsequent meeting in December 1978 however, the Commissioner of Rating and Valuation considered that the problems involved in assessing each stall individually were enormous and amendments to the Rating Ordinance were discussed which would make the Urban Council (and the Urban Services Department in respect of the New Territories) liable for the payment of rates. The adoption of these amendments, it was thought, would facilitate assessment work because only one assessment would then be needed for each market. In July 1979 the Secretary for the Environment advised against such a course of action as he did not believe that it would be acceptable to the Urban Council on account of the high costs and administrative difficulties involved. In November 1980 the matter was again discussed at the Rating Valuation Conference and it was agreed that the matter should be pursued with the Director of Urban Services with a view to securing his agreement to being named the ratepayer in respect of the public markets in the New Territories. If this proved successful then the Urban Council might be prepared to acquiesce in respect of the public markets in the urban areas. No further action was taken however until December 1981 when the Rating Valuation Conference agreed that whilst the matter remained of concern it was not a priority item. No follow-up action has since been taken.
17. The delay in assessing public market stalls to rates has resulted in a substantial loss to the revenue as in accordance with the Rating Ordinance rates due on an interim valuation are only payable from 24 months before the date of the issue of the first demand. Based on the 1979 levels of rateable value and rates of charge I have estimated that the loss to the revenue by way of rates forgone amounted to $2.92 million for the years 1981-82 and 1982–83.
18. I have invited the attention of the Commissioner of Rating and Valuation to the delay in assessing the public markets to rates and the resultant loss to the revenue. I have expressed the view that the problems of seeking the agreement of the Urban Council to be named the ratepayer could be overcome by pursuing the alternative of individual assessment of the public market stalls to rates as my calculations show that it is clearly a cost-effective exercise. On the basis of the Commissioner of Rating and Valuation's costing data, estimated annual recurrent revenue of $1.46 million can be obtained by incurring one-off expenditure of approximately $0.5 million in staff costs. I have suggested that prompt action should be taken to individually assess the public market stalls to rates.
19. In reply, the Commissioner of Rating and Valuation has informed me that he agrees that the public market stalls are rateable tenements under the law. The Commissioner has expressed the view that the net effect of rating these stalls would probably merely transfer part of the Urban Council revenue to the Government revenue as rating the individual market stalls may result in lower rents for the Council. He has also informed me that he is intending to look into the matter again in due course at the Rating Valuation Conference but, because of the current heavy workload and the need to assess other more revenue productive properties, he is unable to give a higher priority to this exercise.
20. I have pointed out to the Commissioner that the market stalls are chargeable to rates under the Ordinance and even if he is correct in his assumption that rating the market stalls would result in the Council receiving less in rentals this should be allowed to take place in order to properly reflect the true position and bring the markets managed by the Urban Council and the Urban Services Department into line with those in Housing Authority estates, private retail markets and wholesale markets run by the fish and vegetable marketing organizations, which are all rated. I have reiterated my concern about the delay in the assessment of the public market stalls to rates, pointing out that any further delay would increase the loss to the revenue. I have suggested that the assessment exercise should be accorded a higher priority.
21. Head 2- General Rates. Subhead 010. Hong Kong and Kowloon (including New Kowloon). Under Section 28(2) of the Rating Ordinance the effective date of an interim valuation in respect of a newly constructed building is the first day of the month following the expiration of three months (for domestic tenements) or six months (for non-domestic tenements) from the date of issue of the occupation permit (or temporary occupation permit), or the first day of the month following the date of occupation, whichever is the earlier. A recent audit inspection at the Rating and Valuation Department revealed four cases where the effective date of interim valuations was incorrectly stated on the interim certificates and as a result periods ranging from one to eight months were not rated. Under Section 29(1) of the Rating Ordinance no adjustment can now be made to correct the effective dates and I estimate that the errors have resulted in a loss to the revenue of $314,000.
22. The Commissioner of Rating and Valuation has informed me that in three cases the loss of rates revenue was due to his staff overlooking the temporary occupation permits at a time when they were busily engaged in a revaluation
7