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Enclosure 11 in No. 1.
(Enclosure 2.)
Governor Tseng to Acting Consul Barr.
(Translation.) (Telegraphic.)
Hangchou, January 9, 1910. YOUR telegram received. The tax is levied by the local Opium Suppression Bureau under instructions from myself, in accordance with regulations issued by the Government, and is already enforced in all the provinces. It is based upon the raw and prepared opium sold by the shops for consumption, and is not in the nature of an additional tax on foreign opium, and so does not infringe the treaties.
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Acting Consul Barr to Mr. Max Müller.
(No. 2.) Sir,
Ningpo, January 13, 1910. WITH reference to my despatch No. 1 of yesterday's date, I now have the honour to transmit copy and translation of my despatch to the Governor of Chekiang upon the subject of the new tax on opium at Hangchow.
I have, &c.
L. R. BARK.
(Enclosure.)
(Enclosure 3.)
Hangchow Regulations for the Licensing of Shops selling Raw or Prepared Opium. (Translation.)
1. SHOPS applying for licences shall be each guaranteed by a group of other shops, the guarantors to make good any default in payment of taxes. Hereafter the closing of shops, but not the opening of any new ones, will be permitted. Opium shall not be sold by shops dealing in other merchandise. Infringement of these regulations will be visited with punishment.
2. The scale of fees for the licences shall be as fixed by the Board of the Interior, shops being divided into three classes according to capital. Beginning from the 1st year of Hsuan-t'ung, shops of the first class shall pay 6 dollars, of the second class 4 dollars, and of the third class 2 dollars. Shops selling opium without a licence to be officially closed and the stock confiscated.
3. Buyers of prepared opium to have their permits inspected and opium only of the kind and quantity therein specified to be sold to them. Sales to be recorded in books, which shall agree with the figures on the permits. Sale to customers unprovided with permits shall be punished by fine of twenty times the value of the sale; similar fine, of twenty times the excess, in case of sale exceeding permitted quantity.
4. Similar procedure in case of buyers of raw opium; and it is to be ascertained whether they are permitted native or foreign opium, and how much of each. Two ounces of the raw drug to be held equivalent to 1 oz. of the prepared. Infringement will be punished.
5. No more than three months' supply to be sold at one time to any customer. 6. The Board of Finance has directed a tax, to be collected by each shop upon each sale of opium, of 40 cash per ounce of raw opium, and 60 cash per ounce of prepared opium. By order of the governor, this shall be replaced by 4 cents and 6 cents Mexican. Travellers buying under a sub-permit shall be subjected to the same tax.
Taxes collected to be handed to the magistrates every ten days for transmission to the Opiun Prohibition Bureau. Embezzlement and defalcation will be severely dealt with.
7. Strict account to be kept by all shops of the total monthly sales of opium, distinction being made between the native and foreign and the raw and prepared drug.
8. All official closings of shops to be reported and the licences cancelled.
9. Licences to be renewed annually. Lost licences may be replaced on satisfactory guarantees being furnished.
10. The tax herein mentioned does not replace or affect the already existing tax on prepared opium, which is still enforceable.
The foregoing regulations have been approved by his Excellency the together with certain regulations contingent thereon, and are printed and put into force governor, by his orders.
Sir,
Acting Consul Barr to Governor T'sêng.
Ningpo, January 12, 1910. I HAVE the honour to inform you that I have received a letter from Messrs. Sassoon of Shanghai stating that, contrary to the procedure established by the treaties and hitherto observed, whereby no further taxation beyond duty and li-kin may be imposed upon opium imported into China, a tax, to come into force upon the 1st day of the Chinese 12th moon (11th January) upon all opium, native or foreign, of 4 Mexican cents per tael weight, has been announced by the Hangchow Opium Suppression Bureau. Messrs. Sassoon asked me to request that the proposed tax might be pro- hibited, and on the 8th instant I accordingly telegraphed to you in that sense. the 9th instant I had the honour to receive your telegraphic reply, stating that the tax was to be levied upon opium sold to the shops and to the consumer, and that there was no question of any additional tax on foreign opium or of any breach of the treaties.
I have closely examined the regulations as to the new tax, and find that they make no mention of the tax being confined to native opium only, as your telegram, though somewhat indefinite upon the point, implies, so that Messrs. Sassoon's objections would appear to be justified.
On
I find, too, that in correspondence which passed between yourself and Mr. Consul Clennell in March last the latter urged the alteration of certain proposed regulations, which showed a similar ambiguity, with a view to their being more definitely worded.
With regard to the present regulations, your telegram merely states that the tax is leviable upon "raw or prepared opium" as sold to shops and consumers, an expression which falls so far short of explaining the scope of the new tax as almost to evade the question entirely. If foreign opium is not to be taxed, why is no clause clearly stating this inserted in the regulations, thus removing all ambiguity?
The tax of 4 cents amounts to 64 dollars per chest, an increase of almost one-half in excess of the maximum of 110 taels fixed by treaty. Since such a tax, under whatever disguise may be presenteil, is undoubtedly an infringement of the treaty provisions, and must seriously prejudice the interests of British merchants, I have the honour again to ask that you will order the Opium Bureau to levy this tax upon native opium alone, and to make kuown the fact that it is only so leviable.
I am reporting this matter by telegraph to His Majesty's Minister in Peking, and in the meanwhile have the honour to address to you the foregoing despatch.
Enclosure 12 in No. 1.
Mr. Max Müller to Acting Consul Burr.
I have, &c.
L. R. BARR.
(No. 4. Confidential.) Sir,
Peking, February 18, 1910. I HAVE carefully considered your despatches Nos. 1 and 2 of the 12th and 13th ultimo respectively, enclosing copies of correspondence that had passed between you and the Governor of Chekiang in regard to a new tax on opium at Hangchow.
1 approve the terms of your letter of the 12th January, but at the same time I would not wish you to take any further action in the matter unless you are of opinion that the tax in question is being levied in such a manner as to affect adversely the
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