1921-12-01 — Page 7

CANTON'S LUXURY TAX.

An Official Statement.

We are indebted to the Ministry of Foreign Adairs, Canton, for the following official statement regarding the luxury tax on wines and tobayco:

wines and spirits, a statement was arrival at destination, so that to

ably.

third 7. A

THE HONGKONG TELEGRAPH.

been untouched.

Gusern-

empt from all taxus, imposta, that there are actually treaty per duties, likin, chargus, and exae visions expressly acknowledging tions of every nature and kind China's right to levy the fax in whatsoever, irrespective of the question may be surprising but is! nationality of the owner or pos- none the less true. In the fext place, sessor of the articles or the na- there is in general tarins the Amer tionality of the conveyance or can Treaty of 1903, already quoted. vessel in which the transporta recognising China's inherent right tion la mada.

to lay such taxes as are not in van- When it is pointed out, however, fict with treaties. Then the British) 1. It will be remembered that that the exemption given in this Treaty of 1903 recognises expresste before the imposition of the luxury article covers goods only while and specifically taxes ou forrig tax, in the form of stamp duty, on being transported it obviously goods at destination. In this con cigars, cigarettes, and certain has nothing to do with roods aftet |arction a historical nore may be issued by the Canton Information quote this article against this added here. It must be remembered Bureau and published by the Government only makes the case that likin, cansumption tax, and Canton Times in its issue of Sep- of this Government so much the other internal taxes have long been levied by China on both foreign and tember 5th last and by the foreign stronger.

charge levelled native goods. The Chinne`tiövern press elsewhere in China and in Hongkong.

I: pointed cut the against this Government le that it meat has always upheld it in- has torn up the Rules of Trade herent lights," to use the phrased alarming dimensions that the babits of cigarette smoking and based on article 26 of the British logy of the American Treaty. The alcohol drinking were assuming in Treaty of 1858 It must be con-likin, that is, the tax in transit. has China, thus bidding fair to become fessed that the argument is far been commuted by the transit date! successors to opium smoking, the fetched. That article provided for of 21%, but the taxes after un object of this Government in levy revised tariff duties and transi: stinktion have ing the tax; and the fact that other dues. But it is not intended by Efforts, have been made by the for- Governments, eg. the British this Government that either one besign Powers from time to time to

increased. American, Japanese, and, nearer

induce China to compound these? 3. Another treaty provision is taxes; but they have been fruitless. home, Hongkong, were imposing much higher duties on the same also gected in the shape of article When Sir. J. L. Mackay was com commodities. The Government of the French Treaty of 1859 missioned by the British noticed with gratification that the This is a long article providing for meat to negotiate a new commercial general public. beth Chinese and tariff of imports and exports treaty with China in 19, one of his foreign, received the tax favour-/which is to be revised every seves principal objects was to find a solu years and for most-favoured-nation

Con for this rexed question. The treatment

Presumably the pass objection of the Powers was not so 2 Questions having now been

age deemed relevant to the case raised by foreign interests in the following: "Er the paymentach to the taxation itself as to the directly affected by the tax as to of these (tariff) duties, the amount manner in which the taxes were its effect on treaties, it is deemed of which it is expressly provided levied and the uncertainties of their advisable, to remove possible misshall not be increased during the amount. After several months ol understanding, to examine

negotiations, China above mentioned period of seven protracted legal aspect of the tax with refer years and which may not be aug. agreed to accept a customs surtas ence to China's international

mented by any kind of charge or of one and a half times the import obligations.

surtar whatsoever. French sub-duty "to compensate for the aboli 3. One fundamental principleject may inpart into China fremtion of likin, of transit dues in lieu governing the case must first be French or foreign ports and like-[of likin, and út all other taention o stated with all emphasis. It is wise export from China to any foreign nouchi," the reason being that that Chins is a sovereign and it destination all goods which shall the Chinese Government recognised | dependent state and, as such, may not be, at the date of the signing that "the system of levying likin aað do any act she see fit, unless she of the present treaty, and accord-other dues on goods at the place off Has contracted herself out of hering to the classification of the anproduction. It transit, and at rights so to do. In other words, nexed tariff, the object of a special destination impedes the free cis- she may do anything which is not prohibition or special monopoly culation at commodities and injures expressly prohibited

the This translation from the French the interests of trade." Similar by treaties. Even the fact that for-text is not official bat is suf-

provisions were inserted in the eign interests are directly or in-fciently accurate). To say that

American, and Japanese Treaties. directly affected is immaterial; she this clause prohibits. China from does not have to show authority levying a luxury tax after French There was, however, a stipulation in for her act, it is for those who obgoods have reached their place of each of these treaties that these pro. ject to her act to quote treaty pro destination necessitates an inter-visions were to come into effect only visions to prove their case. This pretation which does violence to when all the other Powers bad ar obcious principle is found stated.its plain meaning. The signers of cepted the same engagements. Se if it need any statement, in the the treaty meant that the customs far, the other American Commercial Treaty of tariff should be fixed and shoulded, their acceptance: hence 1906: Article 4: "Nothing in this not be increased, by' any charges theses abvisions remain in abeyance article is intended to interfere or surtaxes (e.g. the recent famine and China stands in the same paris with the inherent right of China] surtax, had it been without con-tion ns before. She can exercise to levy such other taxes as are sent of the Powers). They did not her inherent right to lery transit art in conflict with its provisions." mean anything else. If the violent dues in lieu of likin the rate of Corollary to this principle is the interpretation were to be adopted. which has been fixed at 2-12%, and one that where the wording of a then even transit dues would be all other taxation 00 foreign treaty is ambiguous, that interpre considered illegal, which is ob sucels tation is to be adopted which lays viously absurd.

the

Powers have not

both in transit and at

Furthermore, destination," an dshe can continue

into

less burden on, and restricts to a such an interpretation does viol-

to do so until the provisions of the less extent the sovereign rights offence to the principle already em-

Mackay Treaty and similar treaties the nation under obligation. This phasized that a state can not bel generally accepted rule of in dubio deprived of its sovereign rights elating to the matter come

operation. The Mackay Treaty and mitius is not only good law but by mere implication. ala good sepse, because a con- 9. Article 6 of the General Re. the other treaties based on it there tracting party is not to be presum-gulations for British Trade of fore show that the foreign Pozers) ed to have given away more of his 1843 has also been relied upon as have expressly recognised China's

foreig rights than what he actually says.argument. It is necessary to right to levy taxation en

4. With this premise establish- into this article in view of the goods, so much so indeed that they ed, it is now proposed to deal fact that thase Regulations have have been willing to raise the tari

Erora 5% to 12-12% on condition specifically with the objections been abrogated. raised against the tax both official. ly and unofficially in the press.

5. Objections of the type that "the tax is illegal and cannot be legally enforced without receiving the consent of the foreign govern

with ments in treaty relations China are obviously worthless bat unfortunately often seen

in the

importation

10. The 9th article of the that China agrees to abstain from Japanese Treaty of 1806 has like-exercising that right. It is a cum- wise been pressed into service. pounding of the taxes that foreign he passage that "all articles, the goods are liable to pay. That the exportation of Powers have in treaties acknux- which is not expressly limited or edged China's right to levy on for prohibited by the Tariffs and eign gooda taxes of the nature of the Tariff Rules existing between present luxury tax is therefore a China and the Western Powers, tact. In the exercise of this un

press and sometimes even in of may be freely imported into and doubted inherent sovereign right. exported from China, subject only China may, without previous cua to the partment of the stipulated saltation with the Powers. impose import or export duties" evidently

Reial despatches. General and

vague accusations without proof

are no more valid against nations on the same lines as the French faxury tax even though foreign Treaty above discussed and is no goods are affected. It is, for exam

than against individuals.

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the reluctance 6. A more specific assertion is more applicable than it to the case ple, well known that some countries powerful foreign interests affected that foreign goods, having paid ander discussion.

impose a Inxury tax or ture de luse to accept this tax without demur ís an import duty and half of the 11. This list exhausts all thejon imported articles although they understandable (though, be it noted, import duty, "can take out transit treaty provisions which have been are admitted into the country under it is payable not by them but by the

Misa Annie J. Cannon, the passes covering them from taxa-invoked against this Government a conventional tariff China, in thi retail seller or the constunery, it is American lady astronomer to tion of all kinds whilst en route up to the present. It may be re- respect, is in no different position to be hoped that the talk of justice | whom Professor H. H. Turner

and marked that the wide range and from that of those countries. interior destination

and fairplay to all'riations, great recently paid remarkable after arrival there." The correct diversity of the treaties called into 11. There is a fear in certain and small, that the world has her tribute, has indeed made a came ness of this assertion is conceded service and the lack of unanimity, | quarters that if China's right to im mach, particularly since the for herself in the scientific world- as far as the words "to an interior even in foreign official circles pose a luxury tax on foreign wines downfall of Prussianism, is not mer by the ease with which she can destination." but is emphatically until the Diplomatic Corps in tobacco is admitted, there will empty talk of diplomats and states classify the spectra of the statu disputed us to the words "and after Peking made an official and be no limit to the range of taxes or men. It is to be hoped that obsie that it is not correct to say that but a correspondent points out their arrival there." There is no authoritative selection), as to what of goods taxes. The answer is that, cles will not be raised to China's this enables her to "tell the dis- treaty stipulation which can be chapter and verse should be quot inthe first place that right has at exercise of her proper rights merely tance of 700,000 stars." This was quoted to show that China hased, show that it is not easy to prove ready been admitted expressly To because the pockets of foreign surrendered her interent right to that this Government has been treaties as be pointed out so that dividuals may possibly be indirectly Turner's remarks concerning the due to confusing Professor tax foreign goods after they have solicitous of its treaty obligations. an admission now is nothing new. affected. The world, and in parti work

of measuring atellar arrived at their destination. It is 12. An objection of a different

is stilla sometimes attempted to quote, in kind is that the tax is a discrimina-Secondly this Government will not cular China, has been led to believe distances which support, the British Treaty of tion against a certain class of im-adopt the suicidal policy-of killing that a new era in international des very difficult and laborious busi 1858, article 28, and the Japanese ports of a particular country, foreign trade by indiscriminate ing has been inaugurated and witness with his account of Miss Cannon's marvellous facility in Treaty of 1896, article 10. The That this objection is invalid is at taxation Cams has often in the not bear to be disappointed!

recognising at a glance the special point relied upon in both articles once evident when it is known that past refrated from doing things order to bring peace to the world, characteristics of the spectra of is the same, the latter, which is cigars and cigarettes are imported she has an undoubted right to do the Golden Rule, whether in the various classes of stars. Certain supposed to be so worded as to be from more than one country, like upon representations by foreign Christian or the Confucian form, movements of the stars can be most favourable to this point of wise wizes, beers and spirits. It Powers that such actions work hard should be made the rule of conduct ascertained by examination of view, says:

is not even B discrimination | ship on their nations. But no such aming nations. All articles daly imported into against foreign goods because argument in or can be raised in this China by Japanese subjects or there are large and flourishing instance where impartial opinion transported, subject to the exist. Chinese manufacturers of cigar-must sympathise with this Govern- from Japan shall, while being ettes and wines.

ment in imposing a luxury tax on 13- To say that not only is there | wine and tobacco of 20% when sotie ing Regulations, from one opes port to another, be wholly ex- no infringement of the treaties but Governments impose a lax of 366%.

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