CO129-595-3 Proposed introduction of income tax 12-12-1946 - 26-1-1947 — Page 16

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Dear Serpall,

Colonial Office,

Dover House

16.

Whitehall, S.V. 1.

23

Hamiary, 1947.

You may like to know in commeation with Hong Kong's efforts to increase reverme, timt progress is being made as regards the introduction of Insane Tax. You will remember that the Governor appointed a committee to go into the question of revenue and taxation (Hong Kong telegram No. 996 of 9th September, 1946, refers) and inter alia to consider the introduction of a normal form of Income Tax in plass of the wartime measure introdused in 1941.

We have new heard from the Governor that the Committee have reported in favour of a tax on income, but to avoid loss of revenue from the delay that would be entailed if an inccias tax ordinance en entirely new lines had to be prepared have recomended as an interim measure the re- introduction of the 1941 war reveme Ürdinance with such amend- ments as are neccamry to adapt it to peacetime conditions. To this end, the Governor sent E.W. Padney, who is nominated to take charge of Income Tax, to London for technion) discussions with the Board of Inland Hove mis. These have now been completed and Pudrey is on his way back. He has gone back with the re-drafted Ordinanos which, unless anything unforeseen happens, wẹ nticipate will come into force this year (1st April), in time to pornit tax to be levied en income accruing during April 1946 - March 1947.

We have not yet received an official copy of Tax Ocmmittee's report, bet according to a draft of the report brought by Radney, the Committee estimated that in a

D.R. Serpell, Esq., 0.B.E.,

year

Treasury.