September 13, 1909.]
HONGKONG LEGISLATIVE
COUNCIL.
A meeting of the Hongkong Legislative Council was held on Sept. 10 in the Council Chamber.
The following were present: HIS EXCELLENCY THE GOVERNOR, SIR FREDERICK, JOHN DEALTRY LUGARD, K.C.M.G., C.B., D.S.O.
HIS EXCELLENCY COLONEL C. H. DARLING (General Officer 'Commanding).
Hon. Mr. A. M. THOMSON (Colonial Secretary).
Hon. Mr. C.MI. MESSER (Colonial Treasurer). Hon Mr. P. N. H. JONES (Director of Public Works).
Hon. Mr. A. W. BREWIN (Registrar-General), Hon. Mr. F. J. BADELEY (Capt. Superinten- dent of Police).
Hon. Dr. Ho KAI, M;B., C.M.G. Hon. Mr. W. J. GRESSON. Hon. Mr. E. OSBORNE.
Hon. Mr. E. A. HEWETT.
Hon. Mr. MURRAY STEWART.
Hon. Mr. WEI YUK, C.M.G. Mr. C. CLEMENTI (Clerk of Councils).
MINUTES.
The minutes of the last meeting were read and confirmed.
FINANCIAL.
The COLONIAL SECRETARY, by command of His Excellency the Governor, laid on the table the report of the Finance Committee (No. 14) and moved its adoption.
The COLONIAL TREASURER seconded, and the motion was agreed to.
LIQUOR LICENCES,
The COLONIAL SECRETARY withdrew the resolution standing in his name under section, 6 of the Liquor Licences Extension Ordinance, 1908.
LIQUOR ORDINANCE. *
The ATTORNEY-GENERAL moved the first reading of a Bill entitled an Ordinance to pro- vide for the collection of a Revenue of Excise upon Intoxicating Liquors.
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that, of course, is the essence of all contracts, including contracts for railways and public works. Another drawback is that the contractor must deduct from the amount of his tender the whole cost of the machinery for collection, whereas the Government could to a certain extent use the machinery it has, namely, the Harbour Office, the Police Department, the Treasury and other departments of the Government. But still it is conceiv- able that in calling for such a tender, the machinery of the Government may to some extent be made available to the contractor and so decrease his expenses. A year or two ago, in discussing the question of the railway, I had occasion to state my views to the Council regard- ing the contract system and its advantages and disadvantages, and I observed that in my opinion the contract system had great disadvantages, when it was likely there would be an alteration in the contract subsequent to the signature by the contracting parties. Under this Bill there would be no alteration of contract. In this Bill there is nothing which precludes the system of contract either for European or Chinese liquor should it be found more expedient to adoptlater such a system. At the present time, however, there is great prejudice against it, prejudice which I put down to a confusion of ideas between a contract for the collection of duties such as I have described and a farm such as the opium farm. You will remember that under the contract there is no right of search of private houses or persons or vessels, and that therefore the two most objec-
tionable features of the farm are eliminated,
CHINA OVERLAND TRADE REPORT.
revenue. I was aware that it might create a hardship on some of the smaller dealers. I foresaw that it would be necessary also, if licences were put up, to tax clubs either on their turnover or by licences, and I saw it would inevitably tend to increase private. im- ports by non-licencees. In spite of these difficulties the resolution was introduced to the Council, for after mature consideration the difficulties surrounding the imposition of import duties seemed to be even greater, especially as regards Chinese liquor. In a greater or less degree import duties means £ Customs service as far as the collection of duties is concerned, a service to prevent evasion of duties and a system of bonded warehouses. The proximity of Hongkong to the mainland, and to the free port of Macao, seemed also to increase the liability of smuggling, and that fear of smuggling is also enhanced by the known venality and inefficiency of the Chinese detective | service when under the supervision of Euro- peans. Liquor once smuggled into the Colony cannot be detected like the opium of the opium farmer, and therefore once it is in, there is little further risk to the smuggler. Then there is the difficulty of dealing with liquor imported for re-export after blending and bot- tling, which must either involve an elaborate system of rebates or of bonded warehouses in which such operations must be carried on. I am informed also that goods are largely imported into this Colony to order; that is to say that the name of the consignee does not appear on the case. If liquor were thus im- ported in disguised packages and were discovered, The second method of collecting import duties it is possible-probable that there would be no is to prohibit the sale of any liquor except in claimant for it, as we have often found in the vessels bearing a revenue label which would case of smuggled morphia and firearms, for it is have to be broken in order to extract the liquor. a curious thing that when cases are detected it Under such a system it would be illegal to invariably appears to leak out. The importer have in possession any vessel containing liquor therefore suffers no penalty other than the forfei- except with a broken or unbroken label. ture of the whole or part of his, consignment, The label would boar a revenue stamp. which he could well afford in view of profit to be proportionate in value to the quantity and value made on undetected consignments. I need not, of the vessel containing the liquor. Labelled however, go into the difficulties in detail. They cases would in addition be branded and number- are well known to you, and some of them have ed and entered in a book by the revenue officer, been discussed in the local Press. The resolu. The system has some advantages. Detection tion of August, 13th had, as I anticipated, would be so easy. The contravention of the law the result of focussing public attention would be so palpable to servants and others that upon the question. The unofficial members the risk would be too great to be incurred by consulted the views of their constituents. people occupying respectable positions in the and I received from the senior unofficial mem- Colony. Its cost is negligible, for it involves ber a copy of the resolutions passed at the no machinery. Private importers would import meeting in which they embodied their views. through an agent, who would have the label- Looking at the thorny nature of the question ling done for them or the labelling could be at issue it has struck me as a remarkable done in a government warehouse. The whole- fact that those resolutions were passed unani- sale dealers would have to stamp before sale and mously without a single reservation on the part would get a rebate for re-exportation. of any individual member, and so strong reasonable Itime would be given for ly did the members uphold those views that they consumption of existing stocks, either three took the somewhat unusual course of sending or: six months. This system has of them to the Press for public information, con- course its advantages. It involves to some fident that they would meet with the approval of extent domiciliary visits. It involves the open- HIS EXCELLENCY-The Bill before the the community. The senior unofficial membering of cases, and I am told that the cases in Council which we propose to read a first time said his colleagues would like to discuss which liquor is imported is a very important to-day overlaps, and to some extent supercedes, the subject with me. I gladly acceded item. (Hon. Mr. Murray Stewart-Hear, hear.) two other items which stand on the agenda. In to this proposal, and a very useful and
Broken and damaged cases are not so saleable. the first case the resolution introduced on the interesting discussion took place upon the first The system of farms forms another alternative 13th August last, and secondly, the second read-resolution; which runs as follows:
to the system of collection by Government, a ing of the Bill entitled an Ordinance to amend duty be imposed on all foreign and Chinese method perhaps to be resorted to if the system the Liquor Licences Ordinance, 1898, and the alcoholic liquors imported and consumed in this we now propose to introduce should fail. Lastly, Liquor Licences Extension Ordinance, 1908, Colony. Liquors supplied to ships in un- there is the system to which we propose to and to repeal the Liquor Licences Amendment broken cases for consumption on board, and give a trial. That is to say, the collec Ordinance, 1902.. Before this resolution liquors re-exported, to be exempt from duty." tion by Government of duties on importation was introduced into the Council last In that description I pointed out the difficul- combined with the minimum possible of Cus- August the two comparative systems of raising ties which I have already alluded to, and others toms preventive service. The simplest way revenue on intoxicating liquors, namely, by which I have not to-day dealt with in detail. In in which I can describe that system would be increasing licences and import duties, received some cases effective answers were given in the examination briefly of the main provisions my most careful and earnest consideration. others difficulties were made light of or gave way of the Bill before you. So far as it is applicable When I spoke to that resolution I used the to optimistic forecasts. I will confess that I was the Bill is based on the Liquor Ordinance of the following words: "Beyond doubt it seems to me myself a willing convert, and wished if possible Straits Settlements. The duties that we pro- the simplest and fairest method, and the most to give the import duties a trial. Assuming that pose to impose are the same as those in the advantageous to the revenue would be the import duties are levied on intoxicating liquors, Straits, They are, roughly speaking, so far aş imposition, so far as European liquor is concern- three methods of collection present themselves. spirits are concerned, half the existing duties ed, of import dues," I further said, it falls First, by a contract under tender, leaving the levied in England. Hon. members have noticed equally on all sections of the community, upon contractor to proville all machinery for collec- In the papers that it is proposed in the new private importers and upon service canteens, as tion. It is not fair to call such a system by the Budget to increase these duties by about well as upon the trade." The difficulties sur- name of farm, for no monopoly, either of 33 per cent. The duty imposed on Chinese rounding the effective collection of such duties import or of manufacture is given, and it is liquors is, of course, not identical with that in appeared to me to be so many and so serious simply a contract for the collection of duties the Straits, but the duty is, as I am informed by that we considered that the increase in instead of the Government collecting them. the Registrar-General, acceptable and consider- licence fees was on the whole preferable. I was One drawback to this system, as I have already ed fair by the Chinese community. The aware and fully alive to the fact that they pointed out in connection with the resolu- advantage of that system is that every quality would tend to create a monopoly in the hands tion regarding licence fees, is that the of liquor of the same class pays alike, and of a few capitalists, who might put up prices of contractor's profits form an extra burden therefore there is a tendency to improve liquors with no limit except the limit of their on the community, and are additional to the class of liquor consumed in the Colony. desire for profits, and without any benefit to the the amount paid in as revenue, but (Hon. Mr. Murray Stewart-Hear, hear.)
The COLONIAL SECRETARY seconded The Bill provides that there shall be paid upon intoxicating liquors hereafter imported into, distilled, made or prepared in the Colony the following duties:-
On all spirituous liquors, On all sparkling wines, On all still wines,
native
$3.20 per gallon $2.00 per gallon $1.33 per gallon
On all other intoxicating li
quors, excepting wines and spirits,...
80.32 per gallon On all native wines and spirits, $0.15 per gallon It shall be lawful for the Legislative Coun- cil at any time by resolution to alter or amend all or any of the foregoing duties.
That a
Į
.
A
the