Mr. MacDougall
31
I attach a draft of an "Emergency Rates Proclamation" which is designed to provide a temporary substitute for rating under the Rating Ordinance, 1901.
I should be glad if you would consider this and let me have your views.
2.
The main problem is to get in revenue without creating hardship and without the pre-occupation trained staff. The matter bristles with difficulties.
3. Except in the case of the New Territories, we shall probably find a much reduced population and consequently many empty tenements or floors of tenements. The population itself, apart from war profiteers, is likely to be impoverished. Many tenements have doubtless been destroyed or rendered uninhabitable or barely habitable by war damage and the action of looters.
4. The records of the Treasury and of the Assessor may be intact or may be wholly or partially destroyed.
5. I do not know when the last complete valuation of all tenements was made by the Assessor. In 1941 the Governor in Council adopted the then existing valuation, so any valuation must be that of 1940 if not earlier. Thus even if the records should be found intact any valuation list would bear little relation to the true rateable values of the present day and circumstances. This, with the possibility of the destruction of records, is the fundamental problem.
6.
Much might be said for allowing rating to fall into abeyance pending some measure of recovery and a complete new valuation of all tenements;; but on the other hand it is understood that the Japanese have continued to collect rates (presumably on the basis of the old assessment) and it would be a pity to break the good habit of paying rates. And we must have revenue.
7. In the draft I have tried to meet the above difficulties while working on the general lines of (a) adhering as nearly as possible to the system of rating to which the population is accustomed and (b) making only short time provision (i.e. substituting a quarterly for a yearly basis) in order to avoid hampering transition to the former system when normal government is resumed.
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8, For tenements, other than those in the New Territories, see S.23, excepting New Kowloon, I have suggested instead of the former annual rate at 17 per cent (s.29 of Ord.No.6 of 1901) a rate at 3 per cent per quarter on the rateable value 1.e. 12 p.c. in all if the Proclamation should remain in force for a year.
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9. I recognise that by English standards this former rate of 17 per cent
(= 38/4d in the £) is almost fantastically low; but I think that a gesture of concession would be appreciated and, if we should find an assessment list in existence and elect to adopt and operate on it (retaining the old rateable values), the reduction in the percentage of rates would do much to offset the almost certain depreciation in rateable values. According to my figures it would be tantamount to an all round reduction of valuations by 29.4 per cent. It is difficult, if not impossible, to find any formula for general application which would be equally fair to all because some parts of the Colony have doubtless been harder hit than others.
10. On the extremely difficult question of how the rateable values are to be determined I have, in section 7, left a wide margin for the exercise of discretion.
11.
If we find one of the Assessor's valuations (either for the whole or for any part of the Colony) it can be adopted in whole or in part with any desirable modifications. Otherwise provision is made for utilizing such
data as may turn up.
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12. One thing is certain, we shall not have either the time, the machinery or the trained personnel which would enable us to make any general valuation such as the Assessor used to make and even he had the advantage of having before him the figures for previous years we must be prepared to improvise and the population will have to be content with our exercise of very wide discretionary powers.
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