CO129-532-1 Basis of assessment for military contributions 9-12-1930 - 29-3-1932 — Page 34

II.

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THE CLAIMS NOW MADE BY THE GOVERNMENT OF HONG KONG FOR MODIFICATION OF ASSESSABLE REVENUE.

NOTE.

The effect on the Appropriations in Aid to Army Funds of the suggested modification has been measured in sterling taking the dollar as 1/-, the approximate rate now current.

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8. In C.0. letter No. 82756/31 of 27th February, 1931, the Colonial Office put forward a claim from the Governor of Hong Kong for certain items of the revenue of the Colony of Hong Kong to be exempted from assessment for military contribution. It was stated in October.

1928

(C.0. letter No. 52802/928 of 12th October, 1928), that such a claim would be made in the event of our not agreeing to the Colony's proposal to alter the method of assessment from percentage of revere to percentage of rateable valuation. The Colony's proposal was refused and a despatch, (0.0. to the Governor of 26th July, 1930), to the Governor in July 1930, was agreed with the Treasury and the Colonial Office which, while notifying the refusal of the proposal to alter the basis of assessment, indicated that consideration was being given to the question as to whether any modifications in the existing system were desirable and possible in order to bring it up to date. The Colony were asked to submit details of the concessions they thought were equitable, but were also informed that the general principles governing any deduction from gross revenue laid down by the Haliburton Committee would have to be borne in mind. In particular, the Colony were reminded that the exemption from assesment for contribution of any items of revenue which were taken into account in reaching the present basis of the contribution, 1.0.,

20% of the assessable revenue, would pro tanto "aisturb the proportion between means and contribution (established by the Haliburton Committee)

it would accordingly be necessary to restore the proportion by a corresponding increase in the percentage".

...

The items originally suggested by the Governor of Hong Kong as proper for modification before the percentage of revenue was applied for calculation of the contribution are given in the enclosures to the C.0. letter of 12th October, 1928, as follows :

'b'

'a'

Wireless Telegraphy

Waterworks

Aerodrame

Harbour Dredging

Fost Office

Ferries

To be treated on the basis

of net receipts.

Operations properly chargeable to municipal

rates to be excluded.

In addition, the Colony suggested that the interest on capital expenditure defrayed fram revenue in undertakings treated on the net recd pts basis should be increased from 47 to 6%. Attention was also drawn to the question whether military contribution should be raised on the appreciation of

securities when sold. On this last item a further separate letter was forwarded by the Colonial Office in February 1930, (C.0. letter No. 62832/29 of 19th February, 1930).

9./