CO129-623-8 Estimates of Expenditure- includes a report for the year ending March 1951 1-12-1949 - 31-3-1951 — Page 251

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HONG KONG LEGISLATIVE COUNCIL

Estimating revenue in these uncertain times is an unenvi- able task. A few sources of revenue can be estimated with reasonable accuracy, but some of the more important are liable to the most violent fluctuations from year to year, according to political and other developments. For example, receipts from duties in the last four years have varied over a range of more than $29 million but it is noteworthy that in 1948/49 when there were no windfalls our estimate did not leave much cause for complaint. We must base our estimates of receipts from such duties on probable local consumption. It is certainly not justifiable to gamble on windfalls which may or may not occur as a result of temporary unstable conditions elsewhere. Similarly, in the case of Airport revenue, we cannot pretend to foresee accurately what the future may hold. All that we know is that the air traffic has dropped for the moment to one sixth of the level last August, and we have to decide on a figure which we consider has a reasonable chance of being realized.

A careful review of all the possibilities has led to the con- clusion that it would be unwise to count for the coming year on a revenue of more than $192 million on the present basis of taxation. This is greatly below the figure which we expect to realize for the present year, but it is $28 million more than we reasonably expected to receive when the present year opened, leaving of course the grant from His Majesty's Government out of account. We have been lucky so far, but it would be unwise to disregard altogether certain factors which seem to serve as a warning against being too optimistic. I am told that sales of goods during the Chinese New Year Festival were not as satisfactory as in previous years. There seemed indeed to be an air of caution abroad, and money was not being spent as lavishly as in the past. Then the fact that almost the whole of the godown space in the Colony is taken up, and that the banks are forced to refuse to finance further imports unless they are furnished with evidence that storage space will be available, must give rise to a certain degree of concern. I repeat, there- fore, that an estimate of more than $192 million on the present basis of taxation would in my view be imprudent.

Incidentally this figure includes a sum of $250,000 in respect of a new tax on electric signs, draft by-laws in respect of which are now under the consideration of the Urban Council. The proposal is to license neon and other electric signs. Up to 20 square feet the fee will be $100 per annum. Above this size a further fee of $100 for each additional 10 square feet will become due.

Once again, in the final review of the estimates for the coming year, I was fortunate enough to have the assistance of the Unofficial Members of this Council sitting as an Estimates Committee, and I should like to express my thanks for all the assistance which they have so freely given me. The fact that