3
(15)
86
6.
As I explained in my Telegram No. 756, there can
be no doubt that the ordinary individual in Hong Kong is
finding extreme difficulty in meeting essential commitments
even though on paper he may enjoy what appears to be a high
salary. The prices of many essentials, particularly such
articles as clothing, remain exorbitantly high and it seemed
to me that the argument was well founded that a higher rate
than 10% would, in present circumstances, result in a good
deal of hardship. I therefore agreed to the inclusion of a
10% rate in the Bill. I felt that the main consideration was
to establish the machinery for direct taxation, for once that
was accomplished any adjustment in rate which might become
necessary to meet a change in conditions would not present
the same difficulty. I hoped, too, that this decision might
result in one or two Unofficial Members voting with the
Government. In this, my hopes were more than realised for
four Unofficial Members finally supported the measure.
7.
In order to meet the augmented Taxation Committee's
contention that the Bill reqı ired more exmination by the
unofficial element than had hitherto been possible, I appointed
a committee composed of lawyers, bankers and chartered
accountants, under the Chairmanship of the Honourable
Mr. Arthur Morse, C.B.E.
8.
(a) to examine the Bill in detail and to submit
recommendations in regard to any provisions
which, in the opinion of the committee, might
inflict special hardship on any section of the
community and
(b) to examine the Bill with a view to detecting
anomalies or conflict between provisions and
to submit recommendations for their removal.
The Commissioner of Inland Revenue was the only
official on the committee and I hoped that, although the
terms of reference were restricted, this examination by what