HONG KONG LEGISLATIVE COUNCIL.
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in trade, land development, after years of depression, is only just showing signs of revival, and any adverse factors such as this proposal would do much to set it back again. To the property- owner a 4% increase in the rates would mean a 4% decrease in his return, and the reaction would be general.
Already a case has come to my knowledge where the intending purchaser of a large property withdrew his offer to buy, imme- diately on hearing of the impending increase. It should not be supposed that the present activity in building operations is an unmistakable sign of returned and settled prosperity. Some houses have had to be erected because building covenants had to be ful- filled; others have been and are being put up to meet the demand caused by unrest in the interior. As soon as peace manifests itself in the neighbouring provinces, a general exodus will ensue, as past experience teaches.
We submit that the Government should do everything in its power to encourage land-development, because more buildings will not only bring in more revenue, but relieve the congested parts of the Island.
However, my Chinese colleagues and I recognise that, since the general increase in salaries is an accomplished fact, increased taxation is inevitable, as long as the rate of exchange remains at the present level; and that in the absence of alternative schemes of revenue, an increase in Assessed Taxes is unavoidable as a final measure to enable us to balance our accounts for the coming year.
The point is whether or not there are alternative schemes. Several have been put forward, and we hope that the Government will thoroughly explore their possibilities with a view to adopting some of them. If the proposed increase in the Assessed Taxes is passed by this Council to-day, we ask that in the event of other forms of taxation being devised, or of the rate of exchange rising, or, again, of the financial position of the Colony improving generally, this 4% increase may be remitted or at least reduced proportionately.
The Military Contribution.
I would now proceed to examine Military Contribution, to which attention has been drawn by the Chinese General Chamber of Com- merce. This item is increased from $3,865,560 to $4,784,290—a difference of $918,730. It is an irony that while fresh taxation is about to be levied on it, the Colony is called upon to pay a further sum of nearly a million dollars, not because this sum is actually necessary to meet Military Services, but because we have to pay a prescribed percentage to the War Office, irrespective of the actual cost.
The community was greatly disappointed at the refusal of the Secretary of State to accede to Sir Cecil Clementi's request that
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