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(x) moneys received as punitive rates specially exempted under the provisions of any Ordinance for the time being in force relating thereto from contribution under this Ordinance;
(xi) revenue from the profits arising from the Crown Agents' routine realizations.
Net Receipts of Certain Undertakings only to be Taken.
(8) (i) The charges for working expenses and maintenance of the British Section of the Kowloon Canton Railway and of any railways, telephones, or other productive undertakings of a similar character which may hereafter be established and for interest and sinking fund on any sums raised by loan and utilized for the construction of such railways, telephones, or undertakings shall be deducted from the gross receipts of such railways, telephones or undertakings respectively, and the percentage struck on the net receipts only in each case.
(ii) For the purposes of this Subsection the Government Opium Monopoly, the Government Wireless Telegraphy Services, the Government Motor Meat Van Services, and the Water Installation (House Service) Account shall be recognized as productive undertakings in respect of which the maintenance, cost of manufacture and other work- ing expenses shall be deducted from the gross receipts.
Deduction of Percentage when Productive Undertaking is constructed out of
Revenue.
(4) (1) In the case of the Government Wireless Telegraphy Services the cost of construction of which has been defrayed out of the revenue of the Colony, and not by means of a loan, there shall be deducted in the year 1933 a sum equal to five and a half per centum on the capital expenditure incurred in the establishment of the undertaking during the years 1915 to 1932 inclusive.
(ii) In the case of the said Wireless Telegraphy Services after the end of the year. 1932 and in the case of any railways, telephones, or other productive undertakings men- tioned in Subsection (3), the cost of construction of which may be defrayed out of the revenue of the Colony and not by means of a loan, there shall be deducted annually, until the end of the year 1982 a sum equal to four per centum on the capital expendi- ture incurred in the establishment of such undertakings, and the percentage shall be struck on the net receipts, if any, after deducting the said sum of four per centum.
Objects and Reasons.
1. This Amendment Bill when enacted will repeal Sections 2 and 3 of the principal Ordinance and substitute two sections which represent their effect as modified by agree- ment contained in instructions received from the Secretary of State.
2. The new Section 2 corresponds with Section 2 of the Straits Settlements Ordinance No. 64 (Defence Contribution) and also with the first paragraph of the repealed Section 3 of the principal Ordinance.
3.
The new Section 3 (1) corresponds with Section 3 (1) of the Straits Settlements Ordinance and with the repealed Section 2 of the principal Ordinance with the exception of the inclusion of a saving reference to Subsections (2), (3), and (4) and of the omission of the reference to land sales, premia on leases and statutory land grants which are now included in Subsection (2) of the new Section 3.
4. The new Section 3 (2) gives a list of sources of revenue excluded.
Paragraph (i), relating to land sales, comes from the latter part of the repealed Section 2.
Paragraph (ii), relating to condemned stores, appears in Appendix II of the draft Estimates for 1933 as authorized by Colonial Office despatch 129 of 29th April, 1922.
Paragraph (iii), relating to Gap Rock Lighthouse, expresses the agreement by the Army Council in paragraph 4 of the War Office letter of the 25th April, 1932, enclosed with the Secretary of State's despatch of the 3rd June, 1932.
Paragraph (iv), relating to anti-piracy escorts, and paragraph (v) relating to over- payments, expresses the agreement by the Army Council in paragraph 5 of the said letter. Paragraphs (vi) and (vii), relating to transfers to revenue under Colonial Regulation 291 and to profits from the appreciation of investments when realized, represent the understanding referred to in Colonial Office letter of 14th October, 1932, to the War Office enclosed with the Secretary of State's despatch of the 22nd October, 1932.
Paragraph (viii) refers to Section 5 of the Widows and Orphans Pension Ordinance, No. 15 of 1908, the consolidation of which with its amending ordinances is in course of preparation.
Paragraph (ix) refers to Section 14 of the War Loan Ordinance, No. 12 of 1916, the loan under which has been paid off to Section 15 of the Public Works Loan Ordinance, No. 14 of 1927 and to Section 13 of the Public Works Loan Redemption Ordinance, No. 15 of 1933, the loan under which is to be paid off shortly either in cash or by conversion bonds under the latter Ordinance, and to the proposed new Loan Ordinance for a loan of approximately $28,000,000 with respect to which, as stated in War Office Letter of 25th February, 1933, enclosed with the Secretary of State's despatch of 7th March, 1933, the Army Council is prepared to make a similar concession. Paragraph (x) refers to Section 9 (8) of Ordinance No. 41 of 1912, the operation of which Ordinance is, however, suspended by Proclamation No. 3 in the Hong Kong Government Gazette of the 7th February, 1913.
Paragraph (xi) refers to routine realizations dealt with in paragraphs 12 and 13 of the Governor's despatch No. 400 of 10th September, 1929, and agreed to in para- graph 11 of the War Office letter to the Colonial Office of the 25th April, 1932.
5. The new Section 3 (3) (i) represents the first proviso to the repealed Section 3 of the principal Ordinance.
The new Section 3 (3) (ii) sets out the productive undertakings other than railways and telephones which have been recognized as entitled to similar treatment. The Opium Monopoly appears in Appendix II of two draft Estimates for 1933 as recognised under Colonial Office despatch No. 173 of 10th July, 1914. The Government Wireless Telegraphy Services were recognized in paragraph 2 of the War Office letter of 25th April, 1932, enclosed with the Secretary of State's despatch of 3rd June, 1932. The Government Motor Meat Van Services and the Water Installation (House Service) Account were recognized in paragraphs 3 and 5 of the same letter.
6. The new Section 3 (4) (i) relates to the deduction at the rate of 5 per cent.
in respect of the capital expenditure on the Government Wireless Telegraphy Services for the years 1915 to 1932 referred to in paragraph 2 of the War Office letter of 25th April, 1932, enclosed with the Secretary of State's despatch of 3rd June, 1932, and in paragraph 3 of the War Office letter of 25th February, 1933, enclosed with the Secretary of State's despatch of 7th March, 1933.
7. The new Section 3 (4) (ii) is derived from the second proviso to the repealed Section 3 of the principal Ordinance: but the period of fifty years is made to run from 1932 as stated in paragraph 2 of the said War Office letter of 25th April, 1932.
8. This draft Amending Bill is submitted for consideration under the instructions contained in the final paragraph of the Secretary of State's despatch of 7th March, 1933.
C. G. ALABASTER,
June, 1933.
Enclosure 2 in No.
MILITARY CONTRIBUTION.
DRAFT ORDINANCE.
Attorney-General.
THE adjustment of military contribution in respect of the revenue of any one year is made annually when the final figures for that year are known. The revised assessment on the basis of these despatches has been made in respect of the year 1932. The draft Bill includes the various points on which settlement has been reached, but certain observations and explanations are necessary in regard to the first adjustment. Section (2) (v), Overpayments Recovered in Previous Years.These overpay- ments, which previously had been deducted from expenditure, would amount normally to perhaps $10,000 a year. At the end of 1932, however, the sum $234,444.91 was standing to the credit of this account, and was made up of ordinary overpayments $11,571 and an extraordinary credit of $222,873, being a reimbursement from loan account in respect of the salaries and conveyance allowances of officers employed on loan works. The salaries were in the first instance charged against expenditure to safeguard the pension rights of the officers concerned (vide Secretary of State's despatch Confidential of 24th November, 1930). The amount so charged being in 1931 $152,204.10 and in 1932 $67,282.31. The latter sum represents salaries for the period 1st January, 1932, to 23rd June, 1932, the new Pensions Ordinance being enacted on the 24th June, 1932. Strictly speaking, the sum of $67,282.31 was not an 3 overpayment in previous years but an overpayment in previous months, and but for the fact of imperilling the pension rights of the officers concerned would have been deducted from expenditure account rather than credited to revenue account.
If it
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