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HONG KONG LEGISLATIVE COUNCIL.
tion Committee at about $10,000,000 per annum. I can at present give no reliable estimate of the costs of administration but they are likely to be only a small percentage. The local defence and war expenses are not likely to aggregate more than $2,000,000 per annum and the balance payable to His Majesty's Government should be of the order of $7,000,000 or $8,000,000. I do beg, however, that nobody will hold these figures against me if they turn out wrong. There are no statistics whatever of total incomes
in the Colony and we are compelled to do a lot of guesswork at this stage."
So far from local defence and war expenses not aggregating more than 2 million dollars per annum they have in fact aggregated almost 12 million in the last year, due chiefly to expenditure on A.R.P. and food reserves. Two contributions of £100,000 each have been made to H.M. Government bringing the total war expenditure to 15 million dollars. I may add in passing that this Colony is further contribut- ing £200,000 per annum for the period of the war from the profits of its Exchange Fund, while almost a further £100,000 has been raised in the past year by voluntary subscription through the War Fund inaugurated by the South China Morning Post and Hong Kong Telegraph.
The excess of $5,300,000 on war expenses has had to be met from ordinary revenue, and to increase that tobacco duties were raised in September. The tax on cash sweeps has been doubled and postage rates are about to be raised. The recent increase in railway charges has not been to produce revenue but to offset the increased cost of coal, and the aim of the further increase in the petrol duties was not to produce more revenue, but, by reducing consumption parti- cularly in respect of private cars, to conserve foreign exchange and save tankerage. With the assistance of this increased taxation it is hoped that ordinary revenue, which has come in well all the year, will be sufficient not only to meet increased ordinary expenditure but also the war expenditure not covered by existing war taxation. I should like to remark in passing that it is difficult strictly to demarcate ordinary and war expenditure and that many items of expenditure in the printed estimates of this year and the draft estimates for next year are either due to or increased by the war.
I now
come to the resolution before Council "that the draft estimates of expenditure for 1941-42 be approved." These estimates amount in all to $62,389,776 inclusive of $12,300,274 specifically classed as war expenditure. The estimated revenue is $54,836,000, $45,536,000 from ordinary sources, and $9,300,000 from war taxa- tion, leaving a deficit of $7,553,776. There is one item in the draft estimates, namely a lighthouse tender for the Harbour Department, estimated to cost $600,000, the building of which would in any case be conditional on happier times and the cessation of other expendi- ture. Omitting this item, therefore, from the estimates we are faced with a deficit of roughly 7 million dollars.
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