CO129-515-3 Tobacco (Amendment) Ordinance- 1929 28-1-1929 - 11-3-1929 — Page 50

BRITISH-AMERICAN TÒBACCO CÒMPANY, LIMITED.

-3-

The Secretary of State for the Colonies.

50

28. 1. 29.

Had our China Company's sales in Hongkong been taxed

on an ad valorem basis of 40% for the year 1927-28 the revenue

paid would have been $706,023.

·

instead of $606,339.

The Company would be prepared to face this increased

revenue payment as we are confident that an ad valorem basis of

taxation, even at the high rate of 40%, would have a beneficial

effect on trade.

We are particularly anxious to avoid a per pound basis

of taxation, as such a basis is always a heavy burden on the cheap

cigarettes constituting the bulk of the Eastern trade. For

instance - at the rate of 80 cents a pound, our high grade brands

"Three Castles" and "Gold Flake" would pay $104. a case of 50,000,

while the popular brand "Premier" and all the cheapest grades

would pay $122. a case the cheaper brands containing a greater

weight of cheap tobacco per thousand.

Having regard to these facts and figures we recommend

very strongly that an ad valorem basis of taxation (or duty), at a

rate not exceeding 40%, be introduced in the Colony. The figures

seem to provide the clearest possible evidence that such a basis

would result in a considerable increase in revenue.

Should this system be adopted it would of course be

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