4
pledges given me, has already formed subject of protest to the acting Governor- General. The Opium Prohibition Bureau, on the matter being brought to their notice, explained that the purchaser in question could, or would, not give a guarantee of the payment of the new tax after the opium had been boiled down, and accordingly elected to deposit the same in advance with the hong from which he made the purchase, and by which it would eventually be paid into the collecting office. Although paid in this manner by the boiler-not the dealer-this is a technical infraction of the convention, and I shall be glad if those concerned would endeavour to ascertain whether or not this be an isolated case. (As the office of the Kuang Jung Yuan, where the new tax is collected, is entirely dissociated from the premises in which they carry on business, I was at one time under the impression that they had retired from the trade, and I take the opportunity of acknowledging my error.)
Not being an expert, I am not in a position to controvert the statement regarding non-deterioration of prepared opium if stored for long periods. I was simply quoting the representative of the Kuang Jung Yuan firm, who seemed to think that boiling down would act as a deterrent against hoarding.
I would, in conclusion, remark that the Chinese word "chuan," translated "monopoly," by Messrs. E. D. Sassoon and Co., and which, according to you, indicates a payment voluntarily made, is the recognised expression for all taxation not of a statutory or permanent nature, e.g., the li-kin tax, originally, as was the British income tax imposed temporarily for a specific purpose, but, equally with the latter, never likely to be abandoned. None of the other Chinese characters cited by you would be used officially to describe an impost of this nature. To argue, therefore, that the word was used ambiguously is not correct, and to translate it by "monopoly " is a misuse of language.
I have, &c.
Enclosure 4 in No. 1.
J. W. JAMIESON,
Précis of the Regulations for Extending the Licence Tax on Prepared Opium. (Translation.)
(A.)-Object.
The object with which the regulations have been drawn up is primarily the suppression of opium and not revenue. This is achieved by raising the price of opium in Kuangtung, thereby bringing Kuangtung into line with other consuming centres, and discouraging opium smokers.
Comparative prices of opium-
In Hong Kong, 1 tael of prepared opium
#
*
Straits Settlements, 1 tael of prepared opium
Canton, 1 tael of prepared opium (foreign)
"
33
(native)
(B.)--Treaty Stipulations.
Dol. c.
4 50
10 00
3 50
2 00
The original intention of the Board of Finance was to confine the tax to native opium, but this was not carried out as the proportion of native to foreign opium consumed in Canton is only 8:7. The additional article to the Chefoo Convention states that a tax can only be imposed on foreign opium after the packages have been broken and the contents sold by retail. For this reason a tax on raw opium has been discarded, and a tax on prepared opium, after boiling, imposed so as to bring foreign opium within the scope of the regulations, and at the same time obviate interference by foreign Powers,
(C.)—Procedure.
The usual procedure followed in Canton when raising funds has been the formation of a monopoly, and the granting of the farm to the highest bidder.
In the present instance, however, the main object is to supervise sales and purchases, and to stop opium smoking. The idea of an opium monopoly has accordingly been abandoned, and a merchant has been appointed to collect the tax on behalf of the Government. It was
5
deemed inadvisable for officials to undertake the collection, as they are unacquainted with the complicated details of the business.
The amounts of foreign and native raw opium are determined by the statistics of the Imperial Maritime Customs and the native opium li-kin office respectively. Its destination is to be determined by reports from raw opium dealers of their sales to prepared opium shops. The tax is to be collected from the latter.
The merchant in charge of the collection has been chosen from among the most respectable and substantial dealers in Canton. He is to work in co-operation with dealers in Canton and in the country. He is to remit the collection to the Opium Prohibition Bureau every ten days for Canton and every month for places in the
country.
The foreign opium consumed in the Nan Hai and Pan Yü districts is 40 per cent. of the consumption of the whole province.
The foreign opium imported at Swatow is 25 per cent. of the import for the whole province.
(D.)-Investigation.
A head investigation office is to be established in Canton, and, where necessary, branch offices are to be opened in the country. The deputy in charge is to keep a daily record of taxes collected and licences issued. The raw opium dealers are to send him a statement every five days, and the deputy is to send a statement every ten days to the Opium Prohibition Bureau, so as to secure a complete system of checks.
The points to which the investigation offices are to direct their attention are the daily purchase and sale of opium by raw opium dealers, and for this purpose they are to examine dealers' books to prevent their reporting less than the actual amounts. The licences to buy raw opium are to be issued daily by the investigation offices and checked when the opium is sold.
The investigation offices are to have nothing to do with remittances of taxes by the merchants in charge of the collection. Their duty is merely to report what amounts should be remitted. The investigation offices are similarly not to concern themselves with disputes between the merchants in charge of the collection and other dealers and local officials. Such disputes will, at the request of the merchants in charge of the collection, be settled by a special deputy sent from Canton.
The expenses of the investigation offices are to be borne by the Opium Prohibition Bureau.
(E.)-Finance.
In the first year of Hsuan Tung-
Import of foreign opium
Consumption of native opium
Total (raw opium)
Therefore (taking 1 picul raw opium as producing 800 taels
prepared opium), total of prepared opium was
--
Thereon the tax (at 80 cents per tael) would amount to
18,538 piculs.
7.972 39
26,510
21,208,000 taels.
6,362,400 dollars.
The import of foreign opiuma in the year referred to above was less by 1,430 piculs than in Kuang Hsü, 34th year.
According to the Imperial Maritime Customs statistics the import of foreign opium in the first quarter of this year was again less by 420 piculs than in the corresponding period in Hsuan Tung, 1st year.
The consumption of native opium is also decreasing.
Allowing two months from the 1st of the 5th moon as an experimental period, it is proposed to decrease the consumption of prepared opium, starting from the 1st of the 7th moon by 10 per cent. every three months, and to increase the tax from time to time. It is thus expected in 30 months to stop consumption entirely,
Taking the annual collection at 6,000,000 dollars, 10 per cent. is to be devoted to the expenses of the Opium Prohibition Bureau and the offices in the country, 20 per cent, is to be given to the merchant in charge of the collection, and 70 per cent., From this amounting to 4,200,000 dollars, is to be retained by the Government. amount a sum calculated at 60 cash per tael of prepared opium consumed is to be deducted and remitted to Peking. Of the remainder, one-half is to be devoted to the suppression of gambling and one-half to miscellaneous purposes.
532