Directory_and_Chronicle_1935 — Page 44

8

THE BRITISH COMMERCIAL TREATY WITH CHINA

remains the loss of lekin revenue on internal trade to be met, and it is therefore agreed 'that the Chinese Government are at liberty to impose a Consumption Tax on articles

of Chinese origin not intended for export.

This tax shall be levied only at places of consumption and not on goods while in transit, and the Chinese Government solemnly undertake that the arrangements which they may make for its collection shall in no way interfere with foreign goods or with native goods for export. The fact of goods being of foreign origin shall of itself free them from all taxation, delay, or stoppage, after having passed the Custom-house.

Foreign goods which bear a similarity to native goods shall be furnished by the Custom-house, if required by the owner, with a protective certificate for each package, on payment of import duty and surtax, to prevent the risk of any dispute in the interior.

Native goods brought by junks to open ports, if intended for local consumption— irrespective of the nationality of the owner of the goods-shall be reported at the Native Custom-house only, where the consumption tax may be levied.

China is at liberty to fix the amount of this (consumption) tax, which may vary according to the nature of the merchandise concerned, that is to say, according as the articles are necessaries of life or luxuries; but it shall be levied at a uniform rate on goods of the same description, no matter whether carried by junk, sailing-vessel, or steamer. As mentioned in Section 3, the Consumption Tax is not to be levied within foreign settlements or concessions.

Section 9.-An excise equivalent to double the import duty as laid down in the Protocol of 1901 is to be charged on all machine-made yarn and cloth manufactured in China, whether by foreigners at the open ports or by Chinese anywhere in China.

A rebate of the import duty and two-thirds of the import surtax is to be given on raw cotton imported from foreign countries, and of all duties, including Consump- tion Tax, paid on Chinese raw cotton used in mills in China.

Chinese machine-made yarn or cloth having paid excise is to be free of Export Duty, Export Surtax, Coast Trade Duty, and Consumption Tax. This Excise is to be collected through the Imperial Maritime Customs.

The same principle and procedure are to be applied to all other products of foreign type turned out by machinery, whether by foreigners at the open ports or by Chinese anywhere in China.

This stipulation is not to apply to the out-turn of the Hanyang and Ta Yeh Iron Works in Hupeh and other similar existing Government Works at present exempt from taxation; or to that of Arsenals, Government Dockyards, or establishments of that nature for Government purposes which may hereafter be erected.

Section 10.-A member or members of the Imperial Maritime Customs Foreign Staff shall be selected by each of the Governors-General and Governors, and appointed, in consultation with the Inspector-General of Imperial Maritime Customs, to each pro- vince for duty in connection with Native Customs affairs, Consumption Tax, Salt and Native Opium Taxes. These officers shall exercise an efficient supervision of the work- ing of these departments, and in the event of their reporting any case of abuse, illegal exaction, obstruction to the movement of goods, or other cause of complaint, the Governor-General or Governor concerned will take immediate steps to put an end to

same.

Section 11.-Cases where illegal action as described in this Article is complained of shall be promptly investigated by an officer of the Chinese Government of sufficiently high rank, in conjunction with a British officer and an officer of the Imperial Maritime Customs, each of sufficient standing; and in the event of its being found by a majority of the investigating officers that the complaint is well founded and loss has been incurred, due compensation is to be at once paid from the Surtax funds, through the Imperial Maritime Customs at the nearest open port. The High Provincial Officials are to be held responsible that the officer guilty of the illegal action shall be severely punished and removed from his post.

If the complaint turns out to be without foundation, complainant shall be held responsible for the expenses of the investigation.