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in all conscience, complicated enough at the moment with the necessity to take account of the single or married status of each officer, whether, if he be married, he is accompanied or has left his family in the United Kingdom, and what is his status within the official hierarchy. If we now have to contemplate yet a further complication by way of having to gross up our Colonial Allowance rates to meet the possible incidence of local Income Tax a nightmare situation is likely to develop. We would, therefore, wish to press the Colonial Office to ensure that all possible steps are taken to ensure that no Colonial Government introduces local Income Tax regulations which will involve the taxation of the Colonial Allowance rates payable to the employees, permanent or temporary, of the United Kingdom Government. This is an insurance policy for the future: in the present instance the Hong Kong Government have already taken such action. In view of the serious difficulties which promise to arise if the Colonial Allowance has to be increased to any extent at this instant and all the evidence
and if we is that such an increase will have to be given should then have to allow for the incidence of Hong Kong Income Tax, we would be very grateful if you could get in
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immediate touch with the Hong Kong Government with a view to ensuring the complete exemption of the Colonial Allowance payable to all our United Kingdom based employees on the Station.
4.
I am sending copies of this letter.to Rae at the Treasury, Uppington at the War Office and Adams at the Air
Ministry.
Yours sincerely,
< Sargent
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