32
relief.
This I propose to hold in reserve as a further
inducement to the acceptance of a more normal income tax.
9. Double Taxation and non-residents.
The provisions of the Model Ordinance, with the
amendments and additions suggested in 1943 and 1946 are incorporated. The 1949 acditions give power to substitute
the model arrangement enclosed with the unnumbered circular
despatch dated 23rd Septemer 1946 (c.o. file 1585/73).
Before
an arrangement on these lines can be suggested with the U.K.
or other administrations I shall have to have consultations in
Hong Kong as the effoot of these provisions on the taxation of
shipping companies, in particular, will n ed careful considera-
tion before any decision is reached.
10.
Returna Assessment
Penalties etc.
These Chaptera re-enast the provisions of 1942
with minor changes. The organisation set up in 1940 and 1941
functioned smoothly, socording to the information available to
me, and I see no reason for change save such as may be necessary
to cope with personal assessment. uch change would not need
legislative sanction.
11.
General.
As indicated in the opening paragraph of these netes,
I have endeavoured at one and the same time to adhere to the
general plan of the 1941, taxation and to offer to Họng Kong
the benefits of a more orthodox Income Tax. The extent to which
election to personal assesment is inde under Chapter VII should
give some indication of the general Chinese attitude towards
the implications of an Income Tax as regards the disclosure of
private affairs and business interests; the extent to which
taxpayers prefer not to aleat for personal assessment should
at any rate indicate the extent to which the Chinese are
prepared to pay for the privilege of not having to disclose
their private business connections.
The proportion
of/