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FUBLIC

། ། ། །

RECORD

OFFICE

བོ།

Reference :-

C.O.882/12

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

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had already been reached, and that any further fiscal burden upon it would be both intolerable and disastrous. Consistently with this view it would be necessary to balance the budget by retrench- ment alone and, to do them justice, its advocates did not shrink from this conclusion on general lines, but when it came to dis- cussing what public services would have to be dispensed with, or at least drastically curtailed, in order to effect the degree of retrenchment required, they were unable to afford us much prac- tical assistance. It became obvious at the end of the discussion that no section of opinion was prepared to make such a sacrifice of the benefits and conveniences enjoyed from the existing govern- ment services as would enable a net reduction of expenditure to be made of Rs.3,000,000, after allowing for pension charges in respect of the staff displaced. The scope and standards of the Mauritian public services are certainly not such as can be main- tained by a bankrupt community, and the general unwillingness to accept any substantial reduction of the services was only one of the many indications which led us to take the less despairing view of the Colony's financial resources. Notwithstanding the long-continued trade depression, aggravated by the exceptional calamity of the recent hurricane, there are abundant signs that the vitality and self-confidence of the planting as well as of the mercantile community are far from being exhausted, and the repre- sentations made to us by so responsible a body as the Chamber of Agriculture as to the desirability of restraining the excessive importation of luxuries by restoring the embargo on the rupee did not suggest that there was no margin of private income which could be made available for restoring the solvency of the Colony's finances.

3. We may note in this connexion a remarkable misconception which seems to exist in the minds of a number of important and influential members of the business community of Mauritius, namely, that the taxable income of the Colony cannot exceed in any one year the amount of the export value of the preceding year's sugar crop. It was put forward with all seriousness that, inasmuch as the total value of the sugar exports for the financial year 1930-31 was Rs.28,116,000, the expenditure estimates for the years 1931-32, amounting to Rs.14,638,305 represented an intention on the part of the Government to appropriate for its own use one half of the total income of the Colony. This illustration was urged upon us day after day and formed the stock argument adduced in favour of the view that the taxable capacity of the Colony had already been exhausted-in actual fact, of course, the taxable income of the Colony is the total income of all its inhabitants, and that total is many times the value of the sugar exports. In the absence of an income-tax system no official information is available as to the amount of private incomes in Mauritius except in the case of

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public servants, aud that of the wage-earning classes. Any esti- mate of the total taxable capacity of the Colony which we could attempt with the material at our disposal would, therefore, be little more than conjecture, but happily it is not necessary to hazard the conjecture in order to show that the particular classes of the community which will be affected by our proposals will still remain in the position which they now enjoy of being among the most lightly taxed classes in Mauritius, and much more lightly taxed than similar classes in other highly developed communities. Before stating and explaining those proposals, however, it will be necessary to submit a brief survey of the existing fiscal system of the Colony, covering both general and local taxation.

System of General Taxation.

4. The sources of general revenue for the current financial year (euding 30th June, 1932) are classified in the Estimates under eleven Heads as follows:-

I. Customs

II. Port, harbour and light dues III. Licences, excise and internal revenue IV. Fees of Court or office, payments for

specific services and reimbursements in aid

V. Posts and telegraphs

VI. Rent of Government properties,

VII. Interest

VIII. Miscellaneous receipts

IX. Rodrigues

X. Harbours XI. Land sales

Total

Rs. 4,762,500 314,700

5,868,200

809,504

262,660 111,800

1,076,333

155,500

88,365

250,000

400

Rs. 13,699,962

Of the above Heads of Revenue only 1 and III, which together amount to Rs.10,630,700 of the total figure, represent revenue from taxation. The remainder can be dealt with briefly. Head II is obviously determined by the volume of shipping traffic, and cannot be adjusted to the requirements of the Budget. The same holds good of Head X. Heads IV, VIII, and IX are made up of a number of small items, which are not elastic and cannot easily produce more revenue. Head V also is not capable of much ex- pansion but will probably be slightly increased as the result of the recent C.O.D. arrangements with France, and an increase in the rates of oversea postage. We have also suggested a further increase by the withdrawal of the privilege of free postage at present enjoyed by the local newspapers. This increase is esti- mated at Rs.12,500. No appreciable immediate increase is