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INWARD TELEGRAM
COPY FOR REGISION
217
188
No. 996.
FROM HONG KONG (Sir M. Young)
TO S. OF S, COLONIES.
D. 9th September, 1946. R. 9th
"
13.40 hrs.
MYOL. 1946
13. 521126/44/46
Your telegram No. 811, paragraph 2(1),
Aim is to reduce this year's deficit as far
as is practicable and to approach as nearly as possible a balanced budget in 1947/48, excluding of course special expenditure, With this object in view, I am appointing a committee to make recommendations designed to clone the gap, as far as possible, between present revenue and anticipated normal recurrent expenditure. This involves a comprehensive review of all forms of taxation, but there are certain sources of revenue in regard to which committee is being asked, to make interim recommendations with the least possible dolay so that immediate action can be teken. A general instruction will be given to committee that every effort is to be made as in paragraph 2(1) of your telegram under reference.
2.
Hy comments on further points raised in your No. 600 are as follows:-
Subatitution of a normal form of income tax for the present form of taxing will be considered by above-mentioned committee. Local opposition is strong as shown in recent budget debate and arises from feeling that evasion will be widespread,
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