「 ། ། །
PUBLIC RECORD OFFICE
Reference:
C.O. 882
4PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
J.
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labourers that they would recoup the land tax. Now, if the rice duties were removed before the imposition of a general tax, the result would be that the planters would naturally accept the remission, but would resist with all their influence the equivalent for Moreover, the that remission which would have subsequently to be demanded of them. loss to the revenue of 177,000l. a year, the present income, from rice duties, would be disastrous, and should not be entertained for a moment in view of the obligations to which we have already bound ourselves, and to which we shall have to bind ourselves, before the breakwater and railway extensions now contemplated are completed. The import tax on rice and the home tithe on paddy must stand or fall together.
10. I now proceed to the financial aspect of the question, and I think it desirable to show the state of the revenue of the Colony at the three periods when the question of taxation was mooted and at present, giving at the same time the amount of ordinary and what I may call casual revenue, and also the amount of the taxes on grain at each of the periods.
1845.
Total revenue, Rs. 4,508,720; of this Rs. 770,000 was casual and from incidental
receipts.
Tax on imported grain, Rs. 753,779| = Rs. 1,229,084.
"
on home grain
33
475,305
1868.
Total revenue, Rs. 8,095,684; of this Rs. 1,156,973 was casual. Grain taxes imported, Rs. 1,432,661
Home grain.
"
-
Rs. 2,291,625.
1875.
Total revenue, Rs. 14,093,983; of this Rs. 1,620,141 was casual.
Grain taxes imported, Rs. 1,776,645) Rs. 2,876,689. Home grain
-
1,100,044
Your Lordship will perceive with satisfaction that casual revenue is diminishing in Under this head is classed by the Auditor General, its proportion to ordinary revenue, land sales; interest; fines; pearl fisheries; sale of Government property; survey fees; Government vessels; interest on surplus funda investment; and many other incidental and miscellaneous items of minor amount.
11. It will be seen from these figures that in 1845 and 1868, the revenue derived from taxes on grain were more than one fourth of the revenue of the island, and in 1875 more than one fifth. It must also be considered that this is gross revenue, and that if casual revenue be deducted, the tax on grain forms a very large component part of the resources of the Colony. Before abolishing this source of revenue, we must be sure that whatever is substituted for it should either at once or certainly at no distant time be an equivalent to it, and that the prospect of expansion under the change should be as reliable as it is at present. Moreover, we should carefully inquire and be satisfied that a change will not involve grave and permanent irritation. The Sinhalese are a most peaceable well- conducted race, but taxation and religion are two explosive elements in the East.
12. It is generally, I may say universally, admitted that the only substitute for the home tax on paddy and the import duties on grain would be a general land tax; and it is contended that a land tax may be imposed which would be an equivalent to them. I now proceed to investigate the proposed land tax.
13, I enclose to you a memorandum, drawn up by the Surveyor General, Colonel Fyers, R.E., at the request of my predecessor in 1869. Colonel Fyers has added some He takes the area of taxable statistics to it to make it applicable to the present time.
private land to be about 1,750,000 acres, and that this at an average rate of 38. an acre would give a revenue of 262,000l. per annum. This would nearly make up for the present grain duties and taxes, amounting to 287,000, but taking Colonel Fyers' figures and stretching them as far as I can do, I am quite unable even to approach his estimate.
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14. The following table shows the very highest rates which should be exacted :—
*
Coffee Tea
Acres.
300,000
ΤΑΣ.
£
5 per acre
75,000
4,000
-
-
5
-
1,000
Cinchona
Tobacco
17,000
3
-
2,550
要预
Cocoanut
320,000
-
3
Cinnamon
28,000
Gardens
80,000
564,000
Other grain
102,000
2
1,336,000
Paddy lands
3
2/6
95
48,000
4,200
·
1
2
8,000
70,500
10,200
£219,450
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The large difference of acreage between this calculation and that of Colonel Fyers is to be accounted for, inasmuch as it would be hardly possible to raise a tax on the vast extent of pasture land which he includes in his scheme, not less than 414,000 acres. great portion of this land would hardly find a purchaser at 38. an acre, much less annual renters at any appreciable rate. As cattle are the fly-wheel of agricultural work in Ceylon, no greater blow could be inflicted on the cultivator and on his cultivation than to curtail his pasture ground, which he has hitherto freely enjoyed, and any tax worth collecting would unquestionably curtail it, as he would be unable to pay for the large tract which from the poorness of the herbage he requires to give food to a limited number of cattle.
15. It will thus be seen that we start according to my figures with a loss of 68,0007, a
year.
16. We are now bound to ascertain whether these taxes have hampered cultivation,
or have pressed so hard on the consumer of rice that importation has been hampered.
Home Grain Tithe.
1836 1845
-
379,060. 470,530.
1854
600,240.
1865
·
1875
1,045,350. 1,100,044.
·
Tax on Imported Grain.
229,520 608,051 722,310
--
608,580. 1,168,581.
1,312,550.
1,516,350 2,561,700. 1,776,645
=
2,876,689.
The increase of home cultivation since 1836. is most remarkable, and does not corro- borate the rash and unjustifiable assertions of those who proclaim without looking into returns that the paddy tithe has crushed cultivation, though I should not be warranted It may in concluding that the manner in which it is collected has in no way checked it. be said that the enhanced price of paddy since 1886 swells the value of the return, and affects the favourable conclusions which might otherwise be drawn from these figures as to the increased area of cultivation. This is no doubt true to a certain extent, but that paddy cultivation has largely extended and is largely extending cannot be gainsaid. Moreover, it should be remembered that if the Government has been the gainer by the rise in the value of the bushel of paddy which falls to its share, the cultivator is the gainer by the nine bushels of enhanced value which are his share.
17. As regards the figures which I have assumed in calculating the return from a land tax, I greatly doubt if the sum which they denote could be levied. I have taken the tax which brings in the largest return, that on coffee land at 5s. per acre; but so far as I can ascertain, the planter does not pay in taxation for the rice he furnishes his coolies more than about 58. 3d. an acre per annum on the best estates; and it would be manifestly unjust to apply the same scale to a plantation producing 6 or 8 cwts per acre and to one returning but little profit after deducting working expenses. There must be a dis- criminating tax on valuation, a most difficult operation, and as the maximum would be 58. per acre it is clear that the return of 75,000l. per annum must be reduced. planters, moreover, pay at present at the rate of 2s. an acre under the Cooly Medical Wants Ordinances, and from 28. to 6s, an acre on the annual maintenance of roads in their districts constructed on the grant-in-aid system, by which they have had to defray one half the original cost of such roads. They would undoubtedly claim to have these burdens taken into consideration in case of the introduction of a land tax, unless it were demonstrated that such a tax fell more lightly on them than the customs duty on rice. Under the head of “coffee land” the native gardens producing coffee are reckoned, but
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