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a prohibitive price, and was adulterated to such a degree that nobody would purchase. In the end an enquiry was held, and he was ordered at his own expense to reboil it, separating the good from the bad, and adding a sufficient quantity of the pure article to bring the whole amount of nearly 200,000 oz. up to standard. This he did; but the difficulties of the store were not then over: there were no branch stores or licensed dens or "p'i fa tien " to assist in the disposal of the rehabilitated stock; the police and headmen of the different wards of the city, whose services were sought, refused to have anything to do with it, and it has now been arranged that so-called reputable merchants, furnished with adequate guarantees, shall be allowed to purchase and sell it. As a Chinaman justly observed, this opens the way to various abuses, and any person charged with smoking can retort that he is consuming the official drug. It may be taken for granted that the authorities care naught so long as the stock can be sold and the accounts of the store be duly squared. It is reported that the nefarious deputy has been dismissed, and it is estimated that his speculative venture will have involved him in an outlay of several thousand taels. He remains, however, in Chungking, and is possibly being detained until the whole business is settled. It may here he explained that opium dens being, on paper, now non-existent, the necessity for "kuan kao tien" should cease; but it will be understood from what has just been said that the officials do not mean to be left with any surplus stocks.
2. Area under Opium Cultivation.-Basing my conclusions on the statistics with which this report opens and on information acquired in a general way. I have no doubt that the area under opium cultivation in Eastern Szechuan last season was much in excess of that during the preceding one, and was, I am disposed to think, up to the average of previous years. To do full justice to this part of the matter extended travel is necessary, but I can say this much from personal observation, namely, that in April last the poppy was growing in abundance along both banks of the Yang-tsze the whole way from Chungehou to Chungking, passing by Shih Chu Ting, Fengtu, and Fuchou, a distance by water of 540 li. Two ostensible causes may be assigned for this increase: firstly, the vacillating and changeable policy of the officials; and, secondly, the threat of total prohibition this autumn. Though operating on the minds of the people in different ways, the effect was the same: the man who saw that his neigbour had not suffered by cultivation the previous season again took heart, while the threat of impending total probibition acted as a stimulant to sow as much seed as possible and make bay while the sum still shone. In fact, the Chungking prefect is, as stated by my predecessor in bis opium report for November and December 1908, popularly credited with having said that the people might grow as much as they liked last season as there would be no poppy allowed this.
3. Taxation in Substitution of Opium Revenue.-Two taxes have been introduced which are to take effect throughout the province. One is an increase of 3 cash per catty on salt and the other an addition of 200 cash on every pig slaughtered for food.
I have endeavoured to form an estimate of the revenue previously collected by the provincial authorities on salt, and of the extra amount likely to be obtained from the increased taxation now imposed. Mr. George Jamieson, in his report on the revenue and expenditure of the Chinese Empire, 1896, puts the total revenue accruing to the province from this commodity at 2,170,000 tacls." He takes the total production at 400,000,000 catties, and reckons 1,600 cash to the tacl. Substituting Sir Alexander Hosie's round figures of 500,000,000 catties for the 400,000,000 mentioned by Mr. Jamieson, and taking 1,500 cash to the tael-which is a better average rate for Szechuan at the present time-I estimate that the total annual revenue previous to the new increase was approximately 2,500,000 taels, and that the addition of 3 cash per catty will furuish a further sum of 1,000,000 taels, which is 100,000 taels in excess of 900,000 taels, the amount of native opium li-kin as reported to the Peking Govern- ment in the 28th year of Kuang Hsu.
The additional levy on pigs which became operative on the 1st of the 8th moon (13th September) was inaugurated by a viceregal proclamation, in which the people were given to understand that the proceeds were to be sent to the Board of Finance as the province's contribution towards the loss of revenue which will result to the board from the eradication of opium. The Viceroy in his proclamation estimates that the additional tax will not raise the cost of pork more than 1 to 2 cash a-lb. (catty). The future may bear testimony to his sagacity; but at the present moment the price of pork in Chungking is 112 cash per catty; it had not previously gone above 100. Two or three months only have elapsed since the former levy of 300 cash per pig was increased to 400, and the pork butchers have taken advantage of the new impost to run up prices as above described and to fix a minimum of 106 cash a catty. This,
The now
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however, is somewhat of a digression, and, to return to the point at issue, pork and salt will provide the funds necessary to meet the demands at present made by Peking, it being presumed that the former acknowledged revenue of 900,000 taels from opium li-kin was held at the disposal of the Central Government. There remains the question of províncial requirements.
salt levy will, as previously explained, apparently leave a small surplus of 100,000 tacls. Salt being a Government monopoly its taxation is easily controlled, and it would appear that the idea of the present Viceroy is to obtain a tighter grip on the revenue derived from other sources and to some extent concentrate taxation. Thus, except in the small districts, fees on land transfers have been taken from the magistrates and are now collected by the inland revenue officers, who are appointed from Chengtu, and who have also been made responsible for the taxes on wine, oil, and pork. In principle, there is a good deal to be said for the Viceroy's scheme, as there is for his recent innovation of a fixed scale of salaries for district magistrates; in practice, there is good reason to doubt whether these measures will be equal to the strain put upon them, and one may look to see the old abuses, where not continued in whole or in part, give place to new. Generally speaking, too, it may be expected that the different localities will be largely left to shift for themselves, and that fresh taxes will spring up according to place and circumstance. Some districts report new levies on inns, coal, tea shops, and paper; at Chungking, however, the only increase which can to date be definitely ascribed to opium reform is--excluding, of course, salt and pork--the tax on tea shops of 10 cash
table per diem reported in my intelligence report for the June quarter.
per
4. The Position of the Szechuan Farmers.-The conditions of tenancy of agricultural land in the province of Szechuan are not, I believe, generally known. Briefly, the position is this: The land-owner when leasing to the tenant exacts an adequate deposit in cash as security; the summer crop of rice, less a percentage calculated in various ways, belongs to the land-owner; the winter crops are the tenant's own, and they with the percentage on the summer crop, which I have heard stated may be taken at a rough average of 25 per cent., are supposed to recoup the tenant for his labour and furnish a proper rate of interest on his deposit money. It will, of course, be understood that this is a mere outline the system, and does not embrace the numerous modifications of which every Chinese arrangement of the kind is capable. The winter crops, then, being the tenant's, it follows per se that the opium crop falls to him and not to the land-owner. I have already shown that a rough average assesses the profits on the poppy cultivation at three to four times the amount of those on pulse and cereals. I think that this fact should be borne well in mind when we are told, generally by missionaries, that the people in the province are in favour of opium reform. Such a state of mind does not accord with the character of the Chinese. It is, in fact, quite evident that the entire prohibition of opium cultivation is a very serious matter for large numbers of Szechuanese farmers; it deprives them of their most profitable crop without making provision for an equally valuable substitute. It is easy to talk of scriculture, tea-planting, and cotton; but time, knowledge, suitable physical conditions and capital are needed to make these industries pay. What is possible in one place is not suited to another, and for the most part I under- stand that, should the poppy not be allowed, its place in Ch'uan Tung can, in the immediate future, only be taken by the usual winter crops of pulse, cercals, and rape. It will be said that the prices of these foodstuffs will thereby be reduced. So they will, but the cheaper they become the smaller the margin of profit affecting both land-owner and tenant-the former indirectly; and it must be remembered that in average years Szechuan already produces enough to feed its large population.
5. The Effect of Opium Reform on the Economic Conditions of Szechuan.-To put the matter tersely, opium prohibition involves Szechuan in a commercial and fiscal revolution. New sources of revenue have to be found, and I have shown under the preceding heading that the farmer will be a keen sufferer, intimating that the land- owner will be called upon to share in the tenant's loss. I have, in fact, already heard of local meetings between landlords and tenants, the stand taken by the latter being that they cannot lease on the old terms if deprived of the benefits of poppy cultiva- tion. Farmers and land-owners, however, do not stand alone. Opium, as before stated, is the province's most valuable developed asset, and to Szechuan opium is money, for the whole trade of the province with the outer world is practically an exchange in kind in the hands of the merchant capitalists who (vide Chungking Trade Report for 1903) control the import of yarn and export of opium and silk. Thus it may be anticipated that the abolition of opium will induce à decline in the import of
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