106
Extract from Hong Kong Weekly Press
THE NEW GOLD UNIT.
RELATION TO HAIKWAN TAELS.
The following explanation, of the new scheme of duty collection on the basis of a gold unit has been made by the Customs, says the N.-C. Daily News, and shows the increase in dues in two periods, from February 1 to March 15, and from March 15 onwards.
Period from February 1 to March 15, 1930 inclusive: Goods which formerly paid Hk. Tls. 1 at a spe- cific rate will now pay Gold Units 1.50. One gold unit is equal to U.S. noney 0.40.
=
At present exchange one Shang- hai tael 50 cents U. S. money therefore one Shanghai Tael 50/40 = 1.25 gold unit.
(approximately)
For example: if the present spe- cific duty rate is Hk. Tls. 3 per picul then gold units 4.50 are to be collected. If paid in Shanghai taels the amount due will be 4.50/1.25, or Sh. Tls. 3.600. Before, a duty rate of Hk. Tls. 3 was equivalent to Sh. Tls. 3.342, and thus with the present scheme, with the ex- change as above, the increase is equivalent to Sh. Tls. 3.60-Sh. Tls. 3.342 = .258 which is equival- ent to 7-72/100 per cent.
3.600
3.342
1.0772
Period from March 16 onwards : Goods which formerly paid Hk. Ils. 1 at a specific rate will then pay gold units 1.75; thus the ratc in gold units is to be obtained by multiplying the present Hk. Tls. specific rate by 1.75.
In doing so for the example quoted above, an article now pay- ing Hk. Tls. 3 will be paying (3 x 1.75) 5.25 gold units.
Taking the prosent exchange, i.e. Sh. Tls. 1 gold units 1.25, as above, the amount in Shanghai taels required to cover the duty owing would be: 5.25/1.25, or Sh. Tls. 4.200.
Taking the same exchange (Sh. Tls. 1 = U. S. money .50) it will be seen that whereas formerly the amount of duty owing was Sh. Tls. 3.342 it will be Sh. Tls. 4.200, meaning an increase of over 25 per cent.
4.200
3.342
1.25 +
The above has been worked out at the approximate gold dollar ex- change which exists to-day.
ex-
If there is a rise in the price of silver the percentage will decrease correspondingly, and if the change returns to Sh. Tls. 1 equal- ling approximately U.S.A. gold $0.623 the percentage will be wiped
out.
In other words this scheme will produce the amount of gold expect- ed from the new tariff with the ex- change rate prevailing in January 1929.
Naturally goods paying an ad valorem rate of duty are unaffected by this new scheme except that values will have to be declared in the new unit.
76 Feb.1930
CENTRAL BANK.
NOT GIVING SILVER FOR $1 NOTES.
According to the vernacular Press, the Central Bank of China in Canton has been exchanging $1 banknotes for silver since Monday. On the first day the number of per- sons availing themselves of the privilege did not exceed a hundred. Mr. Lin Tien Chi, the managing- director of the Bank returned to Canton on Sunday from Nanking where he has been conferring with Mr. T. V. Soong, on the re-organi- sation of the Bank. In an inter- view with Canton Press representa- tives, Mr. Lin said that the bank- notes of $1 denomination now in circulation in the market are esti- mated at over $2,000,000. He added that notes of $5, $10, $50 and $100 denominations will be exchanged before long.
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