CO129-499-3 Canton situation- governor's despatches 12-2-1927 - 10-3-1927 — Page 78

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other powers, to blame for failure to carry out the resolutions made at the Washington Conference in respect of China. She has also pointed out in it that at the Customs Conference last year, England was the first to support the suggestions of China, but that the Conference failed on account of opposition on the part of other Powers. What were the proposals at the Washington and Customs Conferences? They are questions of a surtax of 24% on ordinary goods and 5% on articles of luxury. In the interests of our revolution

we indeed welcome the fact that such a bold attack has been

male by England on the other Powers, for it will stir up bad' bad!

feeling and dispute among them. Japan proposed at the

Customs Conference that the surtax should be taken as

security against foreign loans owing by China, but England objected. In comparison, however, it would be better to

turn the surtax into security for loans than to let it fall into the hands of Chang Tso Lin and Shuan Chun Fong for military expenses, for which purpose particularly England

had approved of the enforcement of the surtax. By economic

estimates we know that the receipts of the Shanghai Customs consist of 40% of the Customs revenues of the whole of China,

and those of the Customs at Tientsin 10%; and with the

addition of those at Tsingtao and Ying Hau, 80% of all

Chinese Customs revenue is accounted for. The annual

revenues of all Chinese Customs are 70,000,000 taels, and

the surtax of 21% on ordinary goods and 5% on articles of

luxury, when enforced, will be about $60,000,000. This huge

sum of income which is levied direct from us Chinese, will

be a great help to Chang Tso Lin and Shuan Chun Fong in

destroying the revolutionary influence of China.

Such a

scheme will be more harmful than the loan of £20,000,000 to

Yuen Shih Kai during the second revolution, and this is what

the