CO129-591-7 Estimates for 1946-1947 12-12-1945 - 14-3-1947 — Page 131

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TREASURY CHAMBERS,

GREAT GEORGE STREET,

LONDON, S.W.1.

31st May, 1946

ar Palmer,

133 1

I refer to your letter of the 9th May to James enclosing a draft copy of a telegram to Hong Kong on their estimated figures of revenue and expenditure up to the 31st March, 1947, set out in Telegram No.C.A. 3685 of the 3rd April.

ing

We have the following comments to make on the Colonial Office draft reply.

Paragraph 2. We consider that this paragraph on the recoverable expenditure of the Hong Kong Government needs further expansion. We have sanctioned expenditure of approximately £9 million on consumer goods for Hong Kong and we shall need to know what proportion of this is in fact likely to be spent from Government Funds and how the proceeds of the sale of the goods will be dealt with. A similar question arises on goods procured from Army funds but sold under the Civil Government.

We suggest therefore the insertion of (a) after "it is assumed" and the addition of a new clause (b) at the end of the sentence as follows:-

"That the proceeds of sale of stores and supplies procured either from Army funds or from U.K. advances to Hong Kong will be repaid immediately to the U.K. Exchequer in accordance with Treasury letter of 22nd November 1945."

Paragraph 3. We would like the words "if approved" inserted after "and the financing of this".

Paragraph 6. We agree to clauses (a) and (b), and we suggest that the Hong Kong Government might also be invited to consider some form of Excess Profits Tax in arrear, directed against wealth Accumulated during the war, particularly by collaborators. could be inserted at the end of clause (b) as follows:-

H. Palmer, Esq., O.B.E.,

Colonial Office.

This

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