C. S. O.
M.F. 237.)
a
The
help in the attainment of this object. In memorandum dated the 7th March, 1934, I pleaded strongly for a substantial reduction in the charges for excess water consumption.
ction of the Government in granting rebate of 15 per cent-though it is no means an adequate allowance is in some measure, à contribution to- wards the restoration of public con- fidence, and as such is to be welcomed.
Three Proposals.
In another memorandum dated the 12th May, 1934, as a result of a more comprehensive inquiry conducted by some leading Chinese merchants into the possibilities of ameliorative mea- sures, I submitted three further pro- posals. These proposals were:-
(1) That the Government should, as far as possible, grant extension of time for the fulfilment of building
covenants;
(2) That, in the case of Chinese tenement houses, assessment should he made for each floor instead of for the whole house; and
(3) That, as a temporary measure, the Assessment Tax otherwise known as Rates, be reduced from 17 to 13
per cent.
In respect of the first of these three proposals-extension of Building Covenants-it is a matter for grati- fication that the Government has adopted the generous attitude of granting free extensions. with sub- sequent extensions at reduced rates, in cases of genuine hardship.
It is my understanding that the other two proposals have been referr ed
measures
was dealt with by my honourable friend Mr. T. N. Chau and by myself at the meeting of this Council held on October, 1933 (Hongkong the 12th Hansard 1933, pages 119 & 125). It may be useful to repeat here some of the reasonings adduced by the Hon. Mr. T. N. Chau. in favour of the present system is change: The economically unsound, for it has the tendency of compelling landlords to close the whole house when there are two or more floors vacant, in order to enable them to obtain refund of Rates.
a
This may have the effect of spread- ing the population, but in these days of extreme economic depression, the sight of entirely empty houses dotting all over the town, does not conduce to
a restoration of confidence so essential may not suffer substantially by the to recovery. Further, the revenue change, since many of the houses now entirely vacant will be at least partial- ly occupied, and Rates will be payable in respect of such partial occupation.
The Hon. Colonial Treasurer, Mr. M. J. Breen, in objecting to the pro- posals at the time, said that to assess floors separately as proposed by us would treble the work of the revenue collection branch of the Treasury, and
more than treble the work of the
Assessor's Office, as the extra super- vision would be increased dispropor- tionately (Hansard 1933, page 130). Mr. Breen went on to say (page 131 of Hongkng Hansard 1933) that to assess each floor separately, and con- sequently to refund as vacancies cccur, would merely encourage land-{ lords to remove the occupants of a partially occupied floor and crowd the remaining ones.
An Inconsistency.
I know of a case in which two floors became vacant, and the third was occupied by the cwner himself. If a mortgage also exists, as it does in many cases in these hard times, the position is still worse, and the owner may be forced by the mortgagee to sell out at a ruinous price.
To give another illustration. A common type of such three-storey tenement-houses is one in which the ground floor is used as a shop. In this case the rents, when all parts are occupied, may be $100 for the ground- flcor, and $40 for each of the two upper floors. If, through slackness of trade, a condition too common to-day, the ground floor is unoccupied, the whole-tenement system of assessment is a proportionately heavier burden upon the owner, and correspondingly more disastrous in its results upon livelihood.
I believe, therefore, that the assess- ment of Chinese tenement-houses by floors,
is a measure which would
ameliorate the situation by lifting part of the burden now resting upon a large section of the people, and by restoring in some degree the pur- chasing power on which business activity SO largely depends. The concession, in my view, would not in-
crease the risk
of overcrowding. There would be no inducement to wards overcrowding of flors any more than there is with the present
towards system
overcrowding of houses. At any rate, the matter can easily be regulated by law.
Loss Of $660,000.
to the Trade Commission for
It is computed that the suggestion, examination. I have the greatest
if adopted, would involve a loss in confidence in the Commission, whose
revenue of about $660,000. This personnel is such as to encourage
figure has been arrived at in this hopes that its labours will be produc-
way: The vacant floors of Chinese tive. But while the
I do not think that to change the ad-
tenement houses are estimated to re- vocated by me were intended, as I system would necessitate the heavy present roughly 10 per cent. of all the specifically stated in the memorandum, augmentation to staff feared by the rate-paying buildings in the Colony. as palliatives, to be put in operation Treasury; but even if it would, I sub- According to the report of the Asses- at once, the task of the Commission is mit that it should not stand in the
sor for 1933-34, the total valuation of much more
far-reaching and must way of the change. It is important to the Colony is $38,941,273. Calculat- therefore take time to complete. My bear in mind that the system I ad-ed on the above basis of 10 per cent., to enquire into what vocate has already been applied in the decrease in the total valuation is cculd be done to alleviate the situa- the case of what are called "European- $3,894,127, and the consequential loss tion in the meanwhile, and not to ex-style houses". Why should there be to revenue, being 17 per cent. on the plore the whole question of our trade this inconsistency as between Europ- latter figure, is about $660,000. I depression.
ean-style and Chinese-style houses?
shall later on offer suggestions for If it be no more than justice in the meeting this additional deficit. case of the former that each floor should be assessed separately, it follows that the denial of this con- cession to the latter must mean in- justice, and cannot be defended on any valid principle.
concern was
The proposals which were put for- ward in the memorandum made no claim to be ultimate solutions; their value lies rather in the claim, which may properly be made for them, that they would tend to check the down- ward movement of business generally, so that the conditions which have been daily becoming worse
may not finally deteriorate to a stage at which recovery, even when the opportunity arises, will be most seriously retarded. In short, the measures which I have suggested are measures which, if they are to have any efficacy at all, should be adopted at the earliest possible
mcment.
Assessment of Taxes.
Now, in regard to my second pro- posal-a change in the method of assessment--the system which is at resent applied to Chinese-style tene- ment-houses is illogical and inequit able, as I shall show. This matter
Moreover, the present method of assessment of Chinese-style houses tor in the present depression. The must, in its results, be an added fac- effects it may produce can be simply illustrated. Take a three-storey Chin- ese house. Each flcor may be let for a monthly rent of $50. The owner himself, and be dependent for his may very commonly occupy one floor livelihood on the rents received from the remaining two floors, subject, of course, to payment out of such rents for Crown rent, Rates, insurance and repairs. If one of the floors is vacant, he receives in rent only $50 a month, combined rental of the whole tene- out has to pay 17 per cent on the
ment, namely, $150. Add to this charge the other disbursements men- tioned, and it is clear that his income may be reduced to a starvation point.
In regard to my third and most im- portant recommendation--a reduction in Assessed Taxes by 4 per cent.-I may remind Your Excellency that when this percentage was added in 1930, strong protests were raised by the Chinese community. At a meet- ing of this Council held on the 20th the ensuing year was under considera- October, 1930, when the Budget for tion, I stated that the proposed in- crease had caused great concern among the Chinese, and that re- presentations had been made to the Council by public bodies as well as Chinese members of the Legislative by individuals urging that the rate should remain at 13 per cent. I also said that the opinion had been ex- when cost of living was very high and pressed that in view of the bad times,
the volume of trade abnormally low, any increase in the Rates would have an immediate reaction on the pros- perity of the Colony (Hongkong Hansard 1930, page 203). Whether trade has been in part accentuated by or not the subsequent further fall in
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