CO129-595-3 Proposed introduction of income tax 12-12-1946 - 26-1-1947 — Page 9

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I have passed on to Mr. Pudney the sense

of the preceding minutes.

As regards reserving the surtax point, there

The

is possibly some misapprehension about this.

reasons why a surtax is not possible are given in

paragraph 7 of, No. 3 and, I think, are self-explanatory.

A surtax is something appropriate to a normal Income

Tax and if it is agreed (as it appears to be from the

preceding minutes) that we cannot force a normal Income Tax on Hong Kong at this stage, then the

question of a surtax does not really arise. The

absence of a surtax is, however, a reason for urging

the Governor to put the standard rate as high as

possible.

As regards consulting the Treasury, they are,

I think, usually content to allow the Board of Inland

Revenue to advise even Treasury controlled colonies

on technical Income Tax points. This is understand-

able since the Treasury themselves are advised by the

Inland Revenue. We have, I venture to suggest, been

quite within our rights in not consulting the Treasury

while Mr. Pudney was here on the technical points

involved.

Furthermore, the Treasury usually take a

very long time to give their comments on any matters

Key ULAR

which are either technical, and therefore under

reference to other departments, or are obscure.

avoid this happening in this case, the draft letter

to Mr. Serpell attached is expressed more like a

progress report than a submission of proposals for

Treasury sanction.

To

Nevertheless, Mr. Serpell's con-

currence in the terms of the draft telegram is sought.

ऋ

S

I um.

To Simpell (Ty) Но бирле 6 Cope && Sulbert (BIR)

20th January, 1947.

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