021
6
# Permits and Stamps.
20. All stamps, permits, certificates, and labels shall be manufactured by the Head Office, whence they will be issued to the branch offices. Any irregularity in stamps or documents and any misrepresentations on the part of merchants will result in the confiscation of the opium, unless it be clearly shown that there was no intention to defraud. Fines, however, may not be inflicted.
21. Square stamps will be used by the branch offices and round stamps by the Customs, clearly printed and bearing the name of the province, the serial number, and the date; the same marks are also to appear on the certificates, special permits, and labels, which are to be printed in blue, red, and black respectively.
All these documents are to be obliterated with the seal of the Head Office. Of the quadruplicate certificates, one slip only is to be handed to the merchant, one (the counterfoil) is to be retained by the issuing office, and the other two are to be forwarded, for purposes of verification, to the Head Office and the Board of Revenue respectively.
22. Documents issued to merchants are to be forwarded monthly by the receiving stations through the branch offices to the Head Office, and carefully checked, as forming the evidence of taxation receipts.
23. The opium of any merchant guilty of concealment or obliteration of marks or numbers will be confiscated. Penalties will be inflicted on officials responsible for the careless affixing of stamps or for errors in the issue of documents.
## Statements of Accounts.
24. The total receipts in respect of tax proper and of expenses are to be forwarded monthly by each station to the branch offices, who will return to each province the sum which it is entitled to retain. All surplus receipts are to be forwarded to the Head Office to be dealt with.
The accounts of each station are to be drawn up in duplicate, one copy being retained in the branch office and the other forwarded to the Head Office, together with two copies of the joint account for all the stations under the jurisdiction of each branch office. Of these joint accounts, one copy will be retained by the Head Office and the other forwarded, together with a general statement of accounts for all the provinces, to the Board of Revenue. Forms for accounts will be issued by the Head Office.
Accounts must be carefully checked, each month being kept separately, and must bear the official seals. To avoid unnecessary delay in transmission, surplus receipts from the northern provinces should be forwarded direct to the Board of Revenue.
25. In regard to the retention of revenue derived from opium taxation, each province will, as far as possible, conform to the precedents afforded by the years 1904 and 1905, the surplus being devoted to army funds.
Special allowances will, however, have to be made for certain of the provinces in which either the production of opium has been insignificant or the revenue has been derived from imported opium only.
For the Province of Hupei, a special Report will be furnished by K'o Feng-Shih for the consideration of the Board of Revenue.
The salaries of the officials at collecting stations are to be provided out of the funds to be retained.
Special conditions are also sanctioned for the Provinces of Kuangtung and Kuanghsi.
26. The evidence for the retention of funds will be furnished by the permits and duty certificates handed in by the merchants; these are to be forwarded, with lists, through the branch offices to the Head Office. There must be no irregularities or misrepresentations.
27. The salaries and office expenses, &c., of the taxation officials will be paid out of the "expenses" receipts, in accordance with the recommendations made by the Head Office to the Finance Council and the Board of Revenue. Telegrams on service also may be included under this heading. These sums will, for the present, be advanced by the Head Office, such advances being subsequently refunded from the "expenses" receipts. No other expenditure may be included under the heading of office expenses except the cost of forwarding lists and receipts, which will be made good.
7
28. Of the proceeds of confiscated opium, one-half is to be employed on rewards, and the remainder is to be the property of the province. Monthly reports are, however, to be furnished, and for all opium thus sold, as well as for opium pledged in lieu of payment of taxation, the regular uniform taxes are to be paid and stamps issued.
29. The funds derived from taxation by the Head Office and the branch offices are to be deposited in banks at a fair monthly rate of interest, and the officials will be required to make good all losses resulting from the failure of such banks,
## Reform Prospects.
A
30. The evils introduced by the opium drug are universally recognized, but a thorough eradication alone can effect a change for the better. The introduction of increased taxation can only operate as a preventive if it is rigidly enforced. A gradual reduction, resulting finally in complete abolition, of this scourge might be effected by good advice, as opportunities arise, at the taxation stations, and by the establishment of anti-opium Societies by the officials. The resulting loss of revenue would be no matter for regret.
31. Contingencies not touched on in the above Regulations will be dealt with as they arise in further Memorials.
(No. 15.) Sir,
## Inclosure 2 in No. 1.
Consul Fox to Mr. Carnegie,
Ichang, June 22, 1906.
I HAVE the honour to inclose copy and translation of a Proclamation which was posted here on the 16th instant, inaugurating a new scheme of taxation of native opium throughout the Empire.
The new Regulations, of which the principal clauses are contained in the above Proclamation, came into force at Ichang on Sunday, the 17th instant.
My predecessor, Mr. Ottewill, in his despatch No. 8, dated the 6th July, 1905, reporting the inception of a scheme for the payment in advance of all taxes and duties on native opium in the eight provinces of Hunan, Hupei, Kuangtung, Kuangsi, Kiangsi, Anhui, Kiangsu, and Fukien, stated: "The fundamental principle is that the collection of all taxes on opium is taken away from the provincial authorities and undertaken by the Central Government." In practice, however, the high authorities of these eight provinces resolved themselves into a sort of Syndicate for the collection of the opium taxes within their boundaries; the other provinces, such as Szechuan and Yunnan, continued to levy taxes on their own opium. The Syndicate having apparently proved a success financially, the Central Government have now, in principle and in practice, taken into their own hands the taxation of all native opium produced throughout the Empire. That is to say, on payment of a fixed sum of 115 Kuping taels at the first barrier en route, opium may be transported free of any further fiscal charges to any part of China.
As far as Ichang is concerned, the immediate effect of the new scheme will be to greatly diminish the importance of the port as a taxing station. The duties collected on native opium last year by the foreign Customs alone amounted to 763,576 Haikwan taels, or 94 per cent. of the total revenue collected; of the amounts collected on account of "kao chuan" and "duties," no statistics are available, but the total revenue derived from opium taxed at Ichang in 1905 is estimated to have been well over 4,000,000 taels. I hope shortly to be able to forward details of this estimate. This source of revenue will henceforth be lost to Ichang, as the prefecture produces no opium for export and the Szechuan and Yunnan product will now pay its taxes at Chungking, Fuchau, Kueichou-fu, or some other barrier above Ichang. The Hupei Provincial Treasury will not, however, be altogether a loser, as the scheme provides for an annual refund of a sum equal to the amount collected during the thirtieth year of Kuang Hsü, i.e., 1904. The total collection that year was, I am informed, well above the average of the last ten years.
As the port of transhipment for river-borne opium, Ichang will continue to be an important examination and clearing station.
Page 630
Page 631
021
6
Permits and Stamps.
20. All stamps, permits, certificates, and labels shall be manufactured by the Head Office, whence they will be issued to the branch offices. Any irregularity in stamps or documents and any misrepresentations on the part of merchants will result in the confiscation of the opium, unless it be clearly shown that there was no intention to defraud. Fines, however, may not be inflicted.
21. Square stamps will be used by the branch offices and round stamps by the Customs, clearly printed and bearing the name of the province, the serial number, and the date; the same marks are also to appear on the certificates, special permits, and labels, which are to be printed in blue, red, and black respectively.
All these documents are to be obliterated with the seal of the Head Office. Of the quadruplicate certificates, one slip only is to he handed to the merchant, one (the counterfuil) is to be retained by the issuing office, and the other two are to be forwarded, for purposes of verification, to the Head Office and the Board of Revenue respectively.
22. Documents issued to merchants are to be forwarded monthly by the receiving stations through the branch offices to the Head Office, and carefully checked, as forming the evidence of taxation receipts.
23. The opium of any merchant guilty of concealment or obliteration of marks or numbers will be confiscated. Penalties will be inflicted on officials responsible for the careless affixing of stamps or for errors in the issue of documents.
Statements of Accounts.
24. The total receipts in respect of tax proper and of expenses are to be forwarded monthly by each station to the branch offices, who will return to each province the sum which it is entitled to retain. All surplus receipts are to be forwarded to the Head Office to be dealt with.
The accounts of each station are to be drawn up in duplicate, one copy being retained in the branch office and the other forwarded to the Head Office, together with two copies of the joint account for all the stations under the jurisdiction of each branch cffice. Of these joint accounts one copy will be retained by the Head Office and the other forwarded, together with a general statement of accounts for all the provinces, to the Board of Revenue. Forms for accounts will be issued by the Head Office.
Accounts must be carefully checked, each month being kept separately, and must bear the official seals. To avoid unnecessary delay in transmission, surplus receipts from the northern provinces should be forwarded direct to the Board of Revenue.
25. In regard to the retention of revenue derived from opium taxation, each province will, as far as possible, conform to the precedents afforded by the years 1904 and 1905, the surplus being devoted to army funds.
Special allowances will, however, have to be made for certain of the provinces in which either the production of opium has been insignificant or the revenue has been derived from imported opium only.
For the Province of Hupei a special Report will be furnished by K'o Feng-Shih for the consideration of the Board of Revenue.
The salaries of the officials at collecting stations are to be provided out of the funds to be retained.
Special conditions are also sanctioned for the Provinces of Kuangtung and Kuanghsi.
26. The evidence for the retention of funds will be furnished by the permits and duty certificates handed in by the merchants; these are to be forwarded, with lists, through the branch offices to the Head Office. There must be no irregularities or misrepresentations.
27. The salaries and office expenses, &c., of the taxation officials will be paid out of the "expenses" receipts, in accordance with the recommendations made by the Head Office to the Finance Council and the Board of Revenue. Telegrams on service
also may be included under this heading. These sums will, for the present, be advanced by the Head Office, such advances being subsequently refunded from the " expenses" receipts. No other expenditure may be included under the heading of office expenses except the cost of forwarding lists and receipts, which will be made good.
7
28. Of the proceeds of confiscated opium one-half is to be employed ou rewards, and the remainder is to be the property of the province. Monthly reports are, however, to be furnished, and for all opium thus sold, as well as for opiam pledged in lieu of payment of taxation, the regular uniform taxes are to be paid and stamps issued.
29. The funds derived from taxation by the Head Office and the branch offices are to be deposited in banks at a fair monthly rate of interest, and the officials will be required to make good all losses resulting from the failure of such banks,
Reform Prospects.
A
30. The evils introduced by the opium drug are universally recognized, but a thorough eradication alone can effect a change for the better. The introduction of increased taxation can only operative as a preventive if it is rigidly enforced. gradual reduction, resulting finally in complete abolition, of this scourge might be effected by good advice, as opportunities arise, at the taxation stations, and by the establishment of anti-opium Societies by the officials. The resulting loss of revenue would be no matter for regret.
31. Contingencies not touched on in the above Regulations will be dealt with as they arise in further Memorials.
(No. 15.) Sir,
Inclosure 2 in No. 1.
Consul Fox to Mr. Carnegie,
Ichang, June 22, 1906. I HAVE the honour to inclose copy and translation of a Proclamation which was posted here on the 16th instant, inaugurating a new scheme of taxation of native opium throughout the Empire.
The new Regulations, of which the principal clauses are contained in the above Proclamation, came into force at Ichang on Sunday, the 17th instant.
My predecessor, Mr. Ottewill, in his despatch No. 8, dated the 6th July, 1905, reporting the inception of a scheme for the payment in advance of all taxes and duties on native opium in the eight provinces of Hunan, Hupei, Kuangtung, Kuangsi, Kiangsi, Anhui, Kiangsu, and Fukien, stated: "The fundamental principle is that the collection of all taxes on opium is taken away from the provincial authorities and undertaken by the Central Government." In practice, however, the high authorities of these eight provinces resolved themselves into a sort of Syndicate for the collection of the opium taxes within their boundaries; the other provinces, such as Szechuan and Yunnan, continued to levy taxes on their own opium. The Syndicate having apparently proved a success financially, the Central Government have now, in principle and in practice, taken into their own hands the taxation of all native opium produced throughout the Empire. That is to say, on payment of a fixed sum of 115 Kuping taels at the first barrier en route opium may be transported free of any further fiscal charges to any part It is, in fact, the logical extension of the payment-in-advance principle which foreign Governments have for years past been urging the Chinese Government to adopt in the case of foreign goods.
of China.
As far as Ichang is concerned, the immediate effect of the new scheme will be to greatly diminish the importance of the port as a taxing station. The duties collected
on native opium last year by the foreign Customs alone amounted to 763,576 Haikwan taels, or 94 per cent. of the total revenue collected; of the amounts collected on account of kao chuan" and "duties" no statistics are available, but the total revenue derived from opium taxed at Ichang in 1995 is estimated to have been well over 4,000,000 taels. I hope shortly to be able to forward details of this estimate. This source of revenue will henceforth be lost to Ichang, as the prefecture produces no opium for export and the Szechuan and Yunnan product will now pay its taxes at Chungking, Fuchau, Kueichou-fu, or some other barrier above Ichang. The Hupei Provincial Treasury will not, however, be altogether a loser, as the scheme provides for an annual refund of a sum equal to the amount collected during the thirtieth year of Kuang Hsü, ie., 1904. The total collection that year was, I an informed, well above the average of the last icu years.
As the port of transhipment for river-borne opium Ichang will continue to be an important examination and clearing station.
Page 630Page 631
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