HONG KONG LEGISLATIVE COUNCIL
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It was of course realised that Ordinance No. 13 of 1940 might have to be amended from time to time to cure such defects or anomalies which might be disclosed by actual experience, and in fact it was amended by Ordinances Nos. 21 and 29 of 1940, and was repealed and re-enacted with amendments by Ordinance No. 13 of
1941.
On the whole it can be said that the 1940 Ordinance worked well
and smoothly. Estimated to yield 6 millions each year it actually produced 9 millions for 1940-41, or 50 per cent. more than the original estimate, and the cost of the War Taxation Department was only 3 per cent, of the total amount collected.
Section 73 of Ordinance No. 13 of 1941 provides:
"No tax shall be collectable in respect of any year of assessment subsequent to the year of assessment in which the war which began on the 3rd September, 1939, is terminated."
According to Government this Ordinance is technically still in force and will remain in force until a Peace Treaty has actually been signed, or of course until it has been repealed.
It was in these circumstances, which I might describe as the historical background, that I accepted the invitation to serve as a member of the new Taxation Committee appointed by Your Excellency on the 3rd September, 1946, with terms of reference which include:-
(ii).
(c) Whether, and if so by what date, it will be expedient to replace the taxation now authorised by the War Revenue Ordinance (I have underlined those words, Sir) by the intro- duction of an Income Tax.
The subsequent history of this matter, from the time of the Report of this Committee to the publication of the Bill now before this Council, embodying all the recommendations of the latest Com- mittee appointed by Your Excellency, was fully set out by the Hon. the Financial Secretary when he spoke in support of the First Reading of this Bill last week. I need only add that to the Reports of the various Committees detailed by him I was an assenting party.
Sir, I have ventured to recall these facts, not by way of apologia for the part I have taken throughout this direct taxation controversy, but because I believe these facts are relevant in considering the Bill now before this Council.
In view of the Hon. the Financial Secretary's able analysis of the differences between this Bill and the 1940 Ordinance, I need not take up any further time of this Council in discussing such differences, which are all in favour of the tax-payer. Indeed, the only funda- mental difference between this Bill and the pre-war legislation is contained in Chapter VII, under which anyone liable to tax is entitled to elect to be personally assessed, with the consequential rights to personal allowances.
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