CO129-455 - Acting Governor Claud Severn - 1919 [7-9] — Page 70

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PROPOSED TAXATION OF SALT

- - - - - - - -

The objections to the proposed taxation of salt in the

interests of China are :-

(1) It will not provide Hong Kong with any additional revenue

worth mentioning.

(2) It involves an increase of some 250% in the price of a

common necessary of life. It is true that the average

Chinese consumes but little salt as such and that a

special rate has been provided for the salt used in one

of his princiapl articles of diet, salt fish: but, at the

same time, it can hardly be doubted that the tax will

result in a further increase in the already much enhanced

cost of living and even a few extra "cash" daily are a

serious matter when the total food-bill for the month is

between $4 & $5.

(3) Its effects on the trade of the Colony in general are by

no means certain. No provision is made in the Agreement

for any special terms to "pickle factories" (tseung yuen).

There is a considerable number of these in the Colony and

a very substantial export trade is done in various kinds

of "preserved" produce in which salt must be an important

ingredient. It would be no mean loss if the factories were

removed to Macao or Kwong Chau Wan. Further even the

reduced rate may be sufficient to divert much of our

fishing fleet to these places.

(4) Macao and Kwong Chau Wan are not the only places to which

taxation in Hong Kong might drive our salt-using trades.

From enquiries made among the salt-dealers of the Colony

it seems quite clear that salt can be obtained in fairly

large quantities along the coast of China between Hong

Kong and Swatow at a tax of 40 cents per picul or even

tax-free. Taxation in Hong Kong is proposed for the

purpose of preventing salt from being smuggled into China.

Its

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