148
C.O.
4
assembly of 43 members, consisting of 40 delegates and 3 representatives appointed by the Chinese Chamber of Commerce. The executive body is the town or municipal council, the members of which, at the time of writing, number 7.
The first elections were held in February 1908, and the total number of qualified voters was then 1,695, including 255 Chinese, none of whom, under-it is said-- instructions from the taotai, recorded their votes. It is, however, estimated that at the next elections, which fall due in February 1911, the number of persons entitled to vote will he only 1,169, a reduction of 31 per cent. The reason is that rents have fallen, thereby removing the right of franchise from many who previously enjoyed it. In order to counteract this tendency, a reduction in the rate of assessment on land and buildings has been suggested; but, according to present information, the proposal has little chance of being adopted.
The municipal administration began to function in 1908; it was not, however, before 1909 that its first budget was introduced and the direction and management of the town finances was definitely undertaken. It is not easy to follow from the published reports of the municipal authorities the exact system upon which public moneys have been levied and expended, but a few statistics are appended to this report which will, I trust, with the explanations which it is proposed to give, elucidate, to some extent, the present financial position. The statistics are:---
Annex 2.-Particulars of revenue, showing budget figures, taxation committee's estimate, and actual collection.
Annex 3-Particulars of expenditure, showing budget figures and actual dis- bursements.
Anner -Report of the taxation committee appointed to determine and assess the taxation on land, buildings, lodgings, or apartments, factories, and commercial undertakings.
Anner 5.-Scale of taxation on lodgings or apartments.
Annex 6.-Classification of factories and commercial undertakings, and particulars of suggested annual taxation on vodka distilleries, breweries, and various establishments selling alcoholic liquors.
A glance at the particulars given in Annexes 2 and 3, which are very full abstracts of the estimated and actual items of revenue and expenditure, as shown in the municipal reports, will reveal the work of amateurs, and it may be said at once that the figures purporting to give the revenue and expenditure actually collected and disbursed represent nothing more than a cash account published by the munici- It is, in fact, expected pality to show its financial position at the close of last year. that a complete statement of the year's working will not be obtainable before September next, when it will, it is thought, be possible to obtain a clear idea of the fiscal administration of 1909. This report will be a belated publication, but the fact has to be borne in mind that we are considering the initial work of an entirely new public body, the members of which have had no previous training or experience in dealing with matters of the kind.
Before proceeding to a detailed examination of the figures contained in the revenue and expenditure accounts, it will be useful to give some general information in regard to the different sources of revenue:
Land Taxes ---The rate of assessment is for improved or occupied land & per cent., and for unimproved or unoccupied land 62 per cent. of its market value, in accordance with its situation and position, as fixed by the taxation committee and approved by the assembly of delegates. The highest price asked in the new town and Pristan is 1r. 2c. (say 2.) per square foot and the lowest 20 especks (5d.) and 10 copecks (244) respectively. A premium is placed on corner lots, the cost of which is at times as much as 30 copecks per square foot more than other lots in the same street. It is to be noted that tlie rate of assessment is somewhat lower than that provided in article 8 of the municipal regulations of December 1907.
House and Building Tox.--The tax on houses and buildings is 8 per cent. of their value in relation to the net rental. The actual basis of calculation is that the annual net rent represents 20 per cent. of the total cost-that is to say, capital is held to have repaid itself in five years; business men reckon eight years; but, in either case, it is evident that building in Harbin is a very profitable investment. The assessment of 8 per cent. is within the limit allowed by article 8 of the December regulations, and it may be remarked that the sums of 878,735 roubles and 900,031 roubles, which are stated in Annex 4, to represent the net rentals derived from railway and private
5
30791 ¡REC?
buildings, work out to within a small fraction of 20 per cent. of 4,30L 765 x 10 4,495,409 roubles, the respective estimated value of each.
Tax on Lodgings or Apartments.-The graduated scale contained in Annex 5 shows that the rate of taxation under this head varies from 1 per cent. to 10
per cent.
Taxes on Factories and Commercial Undertakinys.-The taxes levied on factories and commercial undertakings purport to be based on the size and value of the business, the different concerns being classed in various groups according to the classification of the taxation committee as shown in Annex 6. decision lies with the town or municipal council and through that body with the An appeal from the committee's assembly of delegates.
Vodka Distilleries, Breweries, and various Establishments selling Alcoholic Liquors.- At a meeting of the assembly of delegates, held on the 3rd November, 1908, it was decided that certain enterprises, such as vodka distilleries, breweries, &c., should be divided into certain classes, according to the character of their business, and that each class should pay a lump annual sum as taxation, it being left to the persons engaged in the different trades to decide how much individuals and firms should contribute towards the total sum required from the particular class of enterprise concerned. Thus vodka distilleries were called upon to find 40,000 roubles; restaurants, taverns, dining-rooms, and café chantants selling alcoholic liquors, 35,000 roubles; stores and other similar establishmests dealing in the same commodities, 25,000 roubles; and breweries 6,500 roubles--in all, 106,500 roubles. It would, however, appear that this was a very liberal estimate, as I am given to understand that the total revenue obtainable from these enterprises will not exceed 65,000 roubles, the sum allotted to them in the budget.
37
Licences.Taxes "
per annum Izvozchiks (drivers of public carriages)
Carriages (four-wheeled)
Horses
Cycles
(two-wheeled)
Goods carts
Roubles.
12
12
5
S
83
6
Bazaar Lots.-These lots are divided into different classes according to their location, and the annual rents vary from 61 copecks to S copecks per square foot in the Pristan, and from 41 copecks to 10 copecks in the Novi Gorod or New Town,
To pass to a consideration of the revenue and expenditure accounts, Annexes 2 and 3, it is, as has already been stated, not possible to guage from the figures as they stand the results of the year's working. The statement of actual receipts and disbursements is, to reiterate again, merely a cash account and the extent to which it is deficient, as showing the actual revenue and expenditure with which the year should properly be debited and credited will be more clearly revealed by an examination into the more important items.
Revenue.The revenue stated to have been actually collected was 109,912 r. 93 c.,or 97,000 roubles less than the budget estimate of 506,591 roubles. Included in the sum of 409,912 r. 93 e. is, under miscellaneous receipts, an item of 58,454 roubles representing monetary security deposited by various contractors. This is not true revenue as is proved, if proof were necessary, by the fact that the sum of 35,757 roubles appears as à refund to contractors under miscellaneous expenses in the expenditure account. Adding, then, this amount of 58,000 roubles to 97,000 roubles, the deficit already shown, the revenue actually collected falls short of the estimate by 155,000 roubles. The reason for this is not far to seek the following items, land, buildings, commercial undertakings, factories, vodka distilleries, &c., and lodgings or apartments exhibit a total deficit of 221,000 roubles and 166,000 roubles as compared with the budget and the estimate of the taxation committee respectively. Assuming, as I am informed is the case, that for the first four items and the sixth the estimate of the taxation committee is more correct than the figures of the budget, and that as regards the fifth item, vodka distilleries, &c., the contrary holds, then the aggregate shortage on the six items is 188,000 roubles or more than sufficient to account for the total deficit on the budget.
The question which now suggests itself is: "What was the cause of the decreased collection, and is the deficiency recoverable?" The answer as regards the major part is, according to my information, in the affirmative and for the following reason: Under land and buildings the sums of 50,945 roubles and 35,133 roubles are
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