CO129-205 - Public Offices - 1882 — Page 281

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it was strenuously withstood both then and during Sir Henry Pottinger's negotiations; by some for financial reasons, the alleged export of silver occasioned by the opium from trade having produced alarm; by many, no doubt, on moral grounds; by many an unwillingness to face the censure that would not have failed to await overt advocacy of its legalization. Covertly, it was more than connived at. It is not too much to say that the trade was encouraged. The drug was not admitted into the open ports; at least not into the anchorages defined by the Customs; but it was sold at any point along the coast from Shanghae southward, at which it suited the foreign importer to station a receiving ship. Such vessels, I may be reminded, were heavily armed. They were; but for their protection against pirates, not against the authorities. authorities, it may again be urged, had, at the time, no executive fit to cope with armed opium clippers, had they been disposed to expel them. They had not; but they made no effort whatever on shore to deter the people from frequenting the receiving ships. On the reverse, the opium landed from them was, from 1842 if no earlier, farmed or otherwise taxed, and in 1858, when Lord Elgin took the matter up, li-kin was levied upon opium as regularly as upon any article of the regular trade.

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These circumstances had no doubt their due weight with Lord Elgin when he suggested once more the introduction of opium into the Tariff. But his Lordship did not ignore the fact that, while the degree to which Indian opium is abused in China is grossly exaggerated, it was yet beyond doubt that there is in the Chinese consumer a pronounced tendency to exceed in the use of the drug, and that such excess is too commonly followed by fatal consequences, He drew, therefore, a marked difference between the trade in opium and in other imports. He was prepared to concede any Tariff duty that the Chinese Government might demand, provided the import of the drug were so recognized as to bring it formally within the range of Customs sur- veillance, and thus to extinguish the discredit attaching to a trade which, though regularly taxed by the authorities, was technically contraband; but, to use his own expression, he would not assist his countrymen in scattering opium broadcast through the land, and he spontaneously conceded that it should be sold by the importer at the port only; that it should be carried into the interior by Chinese only, and only as Chinese property that the British trader should not be allowed (as in the case of other imports) to accompany it inland; that neither the provisions of Article XIX of the Treaty of Tien-tsin, by which British subjects are authorized to proceed inland to trade, nor those of Article XXVIII for the regulation of the transit dues, should extend to it; that the transit dues on opium should be arranged as the Chinese Government might see fit, and that in the future revisions of Tariff provided for by Article XXVII of the Treaty, the rule of revision applicable to other goods should not be applied to opium. To put it more briefly, if the Chinese would but include opium in the Tariff, they were to be free to do what they pleased with it. I am satisfied that these words do not mis. represent Lord Elgin's intentions regarding the trade. I state it thus explicitly, not as an argument for or against the morality of the trade in opium, but in indication of the position that I conceive Lord Elgin assigned to the trade, as distinct to that assigned to the trade in other British imports.

It may not be ont of place here to observe that but a few months after the negotia- tion of the Tariff, almost at the same moment that Sir Frederick Bruce, with the ratified copy of the Treaty of 1858, was being driven back from the Pei Ho, orders were sent down from Peking to levy a li-kin duty of 80 taels per picul on opium. The order was the result of an unpublished Memorial from the Governor-General, Ho, then resident at Soo-chow, who, if I recollect right, remonstrated against the proposed rate as excessive. The hollowness of the objection of the then Central Government, on moral grounds, to the admission of opium, and its appreciation of the value of the trade to the Exchequer, are more or less attested by this incident.

Sir Frederick Bruce's reception at the mouth of the Pei Ho having rendered necessary, in 1860, the second mission of Lord Elgin, Tien-tsin was added to the ports opened by the Treaty of 1858, and the provisions both of this Treaty and of the subsequent Convention of 1860 came, to a certain extent, into operation.

To a certain extent only. However good in our eyes our cause of quarrel, however indisputably moderate the concessions exacted by Lord Elgin, the hostilities of 1856-60, and eminently the last campaign, had naturally irritated the Central Government, and, as we now know, within a fortnight of the issue of the Decree directing promulgation of the Treaty the provincial authorities were instructed "to let the spirit of restriction abide" in all arrangements of detail that the Treaty must render necessary. The committee of favourites then in power was, it is true, exceptionally corrupt and despotic, but the instructions sent through them were little else than what might have been

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looked for, the traditions of Chinese foreign policy considered. It is certain that no provincial Governor receiving them would regard them as unfair or unreasonable.

We were not long, consequently, in encountering difficulties of various kinds; above all in the operation of those clauses of the Treaty that affect what we are wont to call the Transit Duty question, I employ the phrase most in

but it should more properly be described as the question of Inland Taxation.

vogue,

It must be admitted that, however much of wrong under this head we may lay at the door of the ill-will or bad faith of the Chinese Government, central or provincial, a certain portion of our difficulties is to be traced to the inevitable inexactness with which our rights are defined in the clauses on which those rights are assumed to be based. I am referring more particularly to the clauses concerning our import trade; to our manufacturing millions, the trade of chiefest consequence. To speak of the Chinese contention during our fifteen years' discussion of the matter would be almost a misapplication of terms, for they have rarely vouchsafed any other rejoinder to our protestations against taxation over and above the Tariff duty than the one-that the Government is free to tax its own subjects as it pleases, no matter what the nationality of the goods taxed. They have, at all events, adhered to this principle in action. They have pushed the collection of li-kin up to the very doors of our warehouses. At Amoy the li-kin collection has strangled the trade which from 1880 to 1865 had been flourishing. In the latter year the Tai Ping rebels, driven southward, invaded the province of Fuh Kien. This event authorized the introduction or augmentation of li-kin taxation. It has ever since been maintained in Fuh Kien, ostensibly to support the war on the Turkestan frontier. I have reason to believe that, until lately, the li-kin on imports at Amoy was equal to at least three times the Tariff duty. Our information is not, however, of the best at any port. Even at Shanghac I have found two authorities, both of whom I should have held to be equally valuable, assuring me, the one that li-kin taxation amounted to but 2 per cent. upon our imports, the other that it was not less than 25 per cent.

I return to the interpretation of the Treaty clauses. I have said that the definition of our rights in these was insufficiently exact; and that this was inevitable, because our information was inevitably imperfect. The only data really vouched for on official authority were those already referred to in the Code of the Board of Revenue, a list of the stations at which inland revenue was collected on Imperial account. We did not know, and do not now know, what transit, duty stations, not in the Imperial list, existed before 1843. We were at the same time certain that abnormal taxation was multiplying in every direction, whether on Imperial or provincial account mattered little; we could obtain no authoritative intimation of its nature or amount.

The responsibility of this unacquaintance with details so important to our interests must be charged, I need hardly say, not upon Lord Elgin, but upon those whose function it was to provide him with information; and of these I was one of the chief. I cannot, however, blame either myself or others, my colleagues, for failure to achieve what we desired in this regard. Ďata for a Chinese budget are still somewhat beyond the reach of any inquirer, native or foreign.

Lord Elgin's new Tariff was framed as imposing duty at the rate of 5 per cent. upon value as shown by inspection of the only papers then worthy of trust, the Returns of the Shanghae Customs prepared during the previous three years by Mr. Horatio Lay. The accordance of the half-duty, that is, of an additional 24 per cent., by payment of which the charges described as transit dues were to be commuted, was declared by the Chinese authority, with whom the Tariff was negotiated, liberal. Lord Elgin doubtless hoped that, this paid, our imports would be free of all other charges. I remember his observing, as the Tariff was about to be signed, that he thought if the Chinese Government got 7 per cent. on our trade it ought to be satisfied. He at the same time admitted that once our goods had passed into Chinese hands, he did not see how to secure them against further taxation.

But to what extent was the payment of the Tariff duty alone to avail imports? When would they become liable to the charges which the importer was to be free to commute by payment of the half-duty? It did not devolve upon Lord Elgin to answer the question, for his Lordship had left China before the Treaty had come into operation. But his brother, and successor, when it presented itself, was prepared to give an answer very favourable to the Chinese; for, but for the words that make it optional with the British merchant to compound for inland taxation by payment of a half Tariff duty, or to face the inland charges whatever they may be, Sir Frederick Bruce would have preferred to make the composition compulsory, and the half-duty payable at the same moment as the Tariff duty; that is, at the moment that the imports were landed.

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