3.

82

See

$3789/36.

increases of duty under the Stamp Ordinance and in the annual

fees for motor licences) I am satisfied that the limit to

remunerative enhancement of taxes has been all but reached, and

that any appreciable reduction of next year's foreseen deficit

must be engineered on the expenditure and not on the revenue side.

5.

As regards an income tax I am fully convinced that

even a mere suggestion of the idea at the present juncture would

be a mistake of the first magnitude; it would not only provoke

universal opposition but would at once dry up the fount of

philanthropy which at present feeds the Tung Wah Hospitals, the

Po Leung Kuk, the District Watch Force, St. John's Ambulance

Brigade and other indispensable institutions and social services

which Hong Kong is fortunate in having financed by private

subscription instead of from public funds.

6.

I am glad to say that the balance on our loan funds

will be sufficient to meet in great part one urgent and unforeseen

liability. The present Central Market, completed in 1895, has

recently had to be shored up in order to postpone temporarily (while plans for a new one are being got out) an imminent

collapse that cannot be economically averted. The replacement

is likely to cost something between half and three quarters of

a million dollars, but I will address you separately in the

matter when a properly calculated estimate can be given. Although this liability has fallen upon the Colony at a most untoward juncture it need not be too greatly deplored, as the doomed building is dark, dirty and cramped in its accommodation and would anyhow have had to be pulled down in the interests of

hygiene at a not far distant date.

7.

But even after setting a new Central Market against

Loan Account and after a radical combing and pruning of departmental proposals I find myself faced with an estimated revenue of roughly twenty-eight and three-quarter million

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