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(d.) Or does it mean exemption for all goods that have once paid duty, no matter when met, how handled, or in what sizes, shapes, and quantities ?
(e.) And if this last, how can distinction be made, in the case of native goods, between those that ought to be so free, having arrived by ship and paid duty, and those others which are really locally taxable, having arrived in some other way?"
Accordingly, considering how much there is that is still unsettled in connection with the general question, it is difficult to formulate any statement concerning cigarettes such as "after payment of export and coast trade duties, such and such is The drafting of such a rule- the treatment they are entitled to within port areas." supposing such a rule possible--would be easier if a specific case were stated, for from its settlement a generally applicable principle or modus operandi might be evolved. If therefore you could put a specific case, setting forth that on such a day and at such a place such cigarettes which had paid such duties were called on to pay such additional tax by such office while in the port area, and in the possession of such person, and in such quantity and in such condition, &c., a step might be considered as taken towards making understanding or arrangement possible.
As for the Shimonoseki Treaty, Article VI, paragraph 4, it seems to me to have lost its significance when interpreted by the October Protocol of 1896, which says: "The Chinese Government may impose such tax as it may see fit, provided such tax shall neither be other than that payable by Chinese nor higher."
This lengthy letter is simply to point out the direction in which the ground remains to be cleared, unless you can get the Chinese Government to say that cigarettes are to pay export or coast trade duties at the Maritime Customs and nothing else to any other tax-office; but I fear that assent to such a general rule is not possible, and so you will have to tackle the question of the definition of port areas, otherwise local tax-offices will certainly continue to charge on cigarettes that have no papers to protect them, seeing that opening a port by Treaty does not mean the disappearance of such offices and taxes.
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I am aware that the subject presents some difficulty, and must be treated with discretion. Should the Chinese authorities of Manchuria refuse to recognize the claim of the British-American Company's cigarettes to exemption from li-kin in Treaty ports and trade marts, and the question be referred to the Legation, it will assist me materially if you can submit a specific case in full detail in which the goods can be proved to have paid an additional levy within the port area. Time, place, quantity, ownership, amount of extra tax and by whom levied, together with other facts of importance, should be carefully stated, and evidence of the payment of export and coast-trade duties should also be furnished.
&c.
I
am,
(Signed)
J. N. JORDAN.
Sincerely yours, (Signed)
ROBERT HART.
(No. 11.) Sir,
Inclosure 8 in No. 1.
Sir J. Jordan to Consul-General Fulford.
Peking, February 22, 1907. WITH reference to your despatch No. 8 of the 22nd December, I beg to inclose, for your information, copies of correspondence relating to the duties leviable on cigarettes manufactured at Shanghae.
Prince Ch'ing's note of the 26th December, 1904, closed a correspondence between the Legation and the Wai-wu Pu which arose from a protest made by the British- American Tobacco Company against a 5 per cent. ad valorem tax imposed by the Chinese Government in January 1904 on Chinese manufactures of foreign type. His Highness, in conceding that the earlier specific export duty of 4 m. 5 c. per 100 catties should be levied, made it a condition that the cigarettes should be treated as native produce, and should pay coast trade duty, if reimported at another Treaty port, and internal customs dues if conveyed into the interior from that port. You will notice that his Highness did not stipulate for the payment of any duty other than the coast trade duty in the port of re-entry, and it would appear only reasonable that goods which have already contributed both an export and a coast-trade duty should be free from further taxation until they actually leave that port for the interior.
It seems to me therefore that, while it must be conceded that you are not entitled under Treaty or Regulation to protest against the imposition of internal taxes in a Treaty port on produce classed as native, you may fairly represent to the Chinese authorities that these cigarettes, which are not, in reality, ordinary native produce, have been made the subject of a Special Arrangement, and that the fact of their having already paid export and coast-trade duties does give them a legitimate right to exemption from further levies in the Treaty port, and in support of your arguments you may find it useful to point to the statement in Prince Ch'ing's note which I have referred to above.
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