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The Colony is passing through a serious trade depression and a Commission has been appointed, and is now sitting, to enquire into the causes and effects of the depression and to make recommendations
for the improvement of trade.
Government revenue has fallen and is in
danger of falling further, but in view of the depressed condition of trade no attempt has been made to compensate for the reduction in revenue by increasing
taxation. On the other hand, it has not been possible to remit any of the existing taxes.
On account of the heavy programme of public
works extraordinary to which the Colony is committed
it has been necessary to budget for a substantial
deficit in 1935. The position is not so serious as
at first sight appears for four reasons: firstly, at
the beginning of 1934 the excess of assets over liabilities amounted to $13823,625 or nearly $4,000,000 more than the figure of $10,000,000 which is regarded as the minimum which should be maintained,
and, therefore, notwithstanding an estimated deficit in the current year of $1,200,000 and in 1935 of almost $2,000,000, the estimated excess at the end of 1934 amounts to $10,630,807 or some $631,000 more than the
minimum referred to above. Secondly, certain sources
of revenue which have not been accessible are likely pia of Enal 656) to become so e.g., the Arsenal Yard site, part of the
Victoria Gaol site, Kowloon Tsai Development and North
Point reclamation. Thirdly, the estimated deficit
is