CO129-558-11 Mission of Sir F. Leith-Ross to China- proposals for a Hong Kong - China customs... 29-9-1936 - 30-12-1936 — Page 21

paragraph 6) of the enclosed note, that the Frade in

additional burden to Hong Kong of the payment

of Customs duties on the Chinese scale might

forms of taxation

be offset by reductions of other taxes at

present levied in the Colony. This, however, un totte

no account of

ignores the fact that the beneficiaries by

not warranty

reduction of taxes would hardly be identical

would ham to

no/pay

with the persons who/pay the import duties.

Still more important is the fact that good

many duties in the present Chinese tariff are

definitely protective in character, and the

number of such duties is likely to increase.

The burden of such duties in increasing the

cost of supplies would not be offset by

reductions of taxation in other directions.

5. It has also been suggested that

on the basis of the figures put forward in

the enclosed note the Chinese coastal trade

represents on

culy 8

per cent. of Hong Kong's

total trade, and is accordingly not deserving

of special consideration.

htt

be noted,

must,

It was

however, noted that it is precisely this

trade