1939-11-09 — Page 24

Thursday,

HONGKONG TELEGRAPH

DEBATE ON THE BUDGET-Continued From Page 3 HISTORY OF H.K. FINANCE TRACED BY HON. MR. M. K. LO

HOW HONGKONG

HAS GAINED

and conditional recommendations.

These Include the absolute neces- sily for a detalled investigation of the whole field with the assistance of an "expert", and to this I would personally add the maintenance of numerous experts, far beyond the preliminary or Introductory stages, And further, the Committee recom- mended that the imposition of this

Hon. Mr. M. K, Lo

appearing in the individual Heads of form of Tax should be preceded by Your Excellency: My Hon. friend, Estimates, although approved by thin the formation of a large and sub- the Financial Secretary, i Council and the Secretary of State, stantial body of favourable opinion illuminating "Memorandum on the would not be automatically carried in this Colony.

Financial Position, 1030, 1039 and the out if the revenue position did not The experts whose reports I should Estimates for 1940-41," to which Justify the expenditurn. like to hear before this matter pro-shall have occasion to refer again, re-

Grants To Charity ceeds any further, are not those who marks:

The above, Sir, is all that I have con assure us how successfully In- **An inst year, the revenue for to any on the General Budget, except come Tax worite in other communi- 1940-1941 has been estimate gener to renew a plen which has already Eles, but why it has falled amongst ally on the Aumption that the Chinese communities.

economic activity of the Colony will been made by me in the last two be maintained a not far short of its successive Budget Debates in present level. This many prove to be Counell, The plen, Sir, is that Gov- over optimistle, especially since the ornment may be kind enough to mulce outbreak of the war, but the whole substantial grant for providing

As for those

who would be responsible for ad- ministration of Income tax they would have to be persons with expert training und much experience, The Alternativo

•

The hope of obtaining such advice and permanent assistance does not under existing conditions, appear at all bright. The alternative of pro- curing officials who have to guin their experience at the expense of the smooth working of the system, which should be guaranteed from its Initiation, is a sure way of main- trining its unpopularity.

Whils

outlook in at present no uncertain that charitable and medical relief to the no other firm basis for estimating Chinese the revenue presunta Useif,"

on account of the Sino-

As I have previously pointed out.

trade caused by the war, and by the

With the Inevitable dislocations of Japanese conflict. various measures dictated by Imuch relief is in a humanitarian cause. perial war economy, and with new of mere "proft and luss."

which transcends any consideration i taxation under the proposed War Budge!.

But, speaking In this Counell on! confess to a strong feeling October 13, 1030, I was able to show, that the Financial Secretary's fear on the high authority of the Finnn- that the assumption

clal Secretary, that, in respect of) revenue position la based may bej over optimistic will, unhappily, prove 1937, the revenue benefited to the extent of over $1,000,000 by the Sino-Japanese conflict. Since then, Very striking #gures have been re- vealed by the Financial Secretary's

which I have a

which the

ready referred, Memorandum, to

I am convinced that the majority only too true. of the Chinese community belleve I wish, therefore, to state that, in that it will never be possible to ap-assenting, as a member of the Select proach that stage at which the in- Committee, to the Budget now before cidence of the Tax falls fairly and the Council, I have paid due rekord equitably amongst those who should to the Financial Secretary's state- contribute their more or less towards ment in this Council on October

Millions From War 12. 1939, that the programme at Taking. first, 1938. When the Es- In the Chinese busincas com-

Public Works Extraordinary and also timate for Revenue was first framed, munity the conception of profits on the many items of special expenditure Revenue was put at just over 30% Investment diitera fundamentally

million. The actual revenue exceed- from that which is essential for the

ed this estimate by $0,480,035, and assessment of the Tax,

it.

income where

Difficulty

the

is derived merely this Excess is attributed by I am aware that there is an in- from a single couree. We are, there- Financial Secretary to the incrense creasing proportion of Chinese book-fore, Invariably thrown back, for the in the activity of the Colony which keeping which approaches European mediods, but the bulk of Chinese purpose of assessment not only of prevailed, owing largely to the Sino- business, whether connected with come but of allowances, to in Japanese hostilities and the large in-

vestigate eneh Individual case.

erease in population due to the stume production or industry or with that!

Опо Class Of

enuse." preponderance which may be desi

On the other hand, As an example of one class of dif- expenditure, put at $33,379,549, x- the originul cribed as general trading, ndheres to the systems which, although king culty, I am reminded of the very seeded the estimate

by $3.796,340. business But of this excess, enre of the specific profils on output large proportion of the

the Financial or sales, do not inke cognizance of transacted in this Colony by what Secretary points out that $2,203,210 is known as the "middle man" or general, profits on enterprise.

In unincorporated partnership is commission, agent, the person who was in respect of unallocated stores, loans and Military Contribution, due issued combined Balance Sheet buys and sells not for his own new and Income and Expenditure Account but passes money after mak-lounges in the accounting system, leaving an excess of $1,503,133 in count in which what is considered ing certain recognised deductions.

respect of all other Heads, as the capital may be increased or decreased but in which the "profits for distribution"

are not shown.

as such

hear that

But the only Items that can fairly' be attributable to the Sino-Japanese conflict are Head 22, Medical De-

I would be surprised the total income from this cines of business could be ascertained, with an approximation to accuracy by partment (epidemies and lurger popu- specting all transactions involved Intion $220,513), Head 29, Charitable and the records kept by the princi- Services (relief of refugees $245,355). puls in such transaction.

Hend 34, Public Works Extraordinary (construction of refugee camps and nequisition amounting to $1,097,120,

Ultimato Dofoat To those who cinim that the in- formation required for assessments

In a large number of cases, neither may nevertheless be easily extracted,

of the principals carries on business and to, those who maintain that partial transition from the present in this Colony, Whilst on this ques

tion of commission, it must be well would methods has been envisaged,

known that in each business, and make the same reply, namely, dist all who are qualited to speak in indeed in many private transactions, recognised deductions

there

are

HON, MR. M. K. LO

Head 3, Sub-Head 23, that the Moreover, I note from Port 2 of the Financial Secretary's Memorandum,

amount of $250,000 provided for, re- lief of refugees at the present rate of outlay, will not suffice for more than six months.

If. therefore, we Increase Chis amount to, say, $625,000 to cover the whole period of fifteen months, plus. the whole increase of $224.749, to inlling $049,740, and subtract this total from the net increase of $9,120,003, the resulting increase to the Colony revenue for 1040-1941 s) $0,270,854.

Enormous Profit

November 9, 1939.

hong tax-payer.

there are undoubtedly known rich

have also been made in this Coun

Free And Spontaneous ell, between the crushing burden laid people, and also people whosa riches Since the underlying idon is a on the British tax-payer and the are unknown because concealed, free and spontaneous gift by the light burden imposed on the Hong-| sheer poverty is general and wide-] Colony to England, and not a tribute

spread.

to be excited from an unwilling Before coming to the Colony's con-1 On the question of prevalence of population, the following broad prin-. tribution wish to deal shortly with poverty. I need hardly dwell, for ciples should, in my opinion, govern boll of these points.

As a painful fact, well known to all the chalce of means- Sir, there are no data which lead, social workers. me to think that the Colony in light- to the ly taxed in relation either social services available, or to the taxable capacity of the Colony.

I propose to touch on the question of local social services later on in my remarks. In the meantime, I must concede that this question in complicated by the peculiar position: of the Colony, with lis large fluctuat- ing and 'migratory population.

T Taxablo Capacity

As regards the taxable capacity:

L

Only at the beginning of this year the Hon. the Director of Medical Services, in his inauguralj address before the newly recon- silinted Nutrition Committee. pointed out that on account of: malnutrition, which is a concomit» ant of poverty, more than сде chlid out of every three died-last | year before attaining the age of one year, as compared with one in twenty in England,

Standing Disgrace

1-That, if possible, the means. chosen should not involve a violent departure from the Colony's, facul 'polley, which has been in existence -for nearly a century; and

2-That the TIGANS adopted should command ns ranch popular ' approval an possible: at least it should not go counter to deep- rooted and funčiamental objections of a substantial portion of the community.

Moreover, it seems to me that the amount of the gift should be sub-... · ordinated. to the means available,

We have no hospitals for children. based on the above principles, rather

of the Colony, It seems to me that Indeed, our hospital accommodation

arbitrarily decided amount,

an important point which requires is utterly inadequate, and the over-than that the means should be expert Investigation is as to how crowding in the Chinese hospitals is, adopted in violation of those prin- mach of the Colony's wealth is in though inevitable, a standing dis- ciples for the sake of obtaining an the hands of the permanent resid-grace. ont, and how much of it is fugitive and can be driven away by bur- deasome taxation-fiest From

the

"Hansard which, thanks to my Hon, friend, Sir Henry Pollock, happens to be in my possession that for 1990-I notice that the estimated revenue for 1007] was under 5 million.

By 1916 the revenue was nearly doubled. In 1030, it nearly reached the 28 million mark, and from then) to 1930 it fluctuated between 28 to 33 milion. The average yearly re- venue for the past 10 years works; out at 324 million.

The problems of compulsory edu-

Accordingly, I am bound to say cation (and even of Government that I do not agree with the Govern- provided primary education), and of ment view that the imposition of an juvenile deliquency, are still a long on tax is by far the most suit- way from being solved.

able means to give effect: to tho With thousands of deaths from natural desire of everyone to bear tuberculosis we have as yet not enuse, for it violates

hin.just burden for the common

both of been ablo to find the means to

the. build

principles i have suggested. torium

Chinese Opposition

There can be no reasonable doubt

a properly equipped sana For lack of funds we have not| begun to tackle the problem of that views opposed to the introduc- Slum-clearing

tion of income tax have been con-

Wo have no Old Age Pension, sistently held by many people in the no Poor Law. We have no Air Colony for at least a quarter of a Protection for the masses.

century.

Moreover, the Chinese opposition

Since Your Excellency's arrival in

venture to think that no one who has studied the Budget figures, the Colony you have spared no to this measure must be well known of past years can fail to experi- effort in providing and increasing to Government. When the Idea of ence a sense of concern and dis social amenities. for the Colony in income tax was mooled in con- may at the colossal rise the cost every direction possible, and the nection with the 1914-1018 war, the of Government, culminating in this Colony owes Your Excellency a very then Senior Chinese representative year's 40 million dollar Budget or heavy debt of gratitude. But the on this Counell, the late Mr. Lau to ask himself anxiously whether list of omissions is necessarily still Chu-puk, wrote in to Government a the Colony's expenditure is not formidable. reaching, if it has not niready! over-reached, the Colony's taxable

capacity.

Those who care to read the 1000 Budget Debate will And it interest-

ng reading.

30-Year-Old Slogan

As the "South China Morning!

strong nemorandum against it.

My Senior colleague on this Coun- Post", in its leading article published cil, on November 10, 1938, in anti- cipation of the appointment and re- on October 13, 1930, pointed out:--

"The upper ranks of the Govern- port of the Taxation Committee, ex- mant Service re not open to the pressed himself strongly against it. Hongkong citizen: he has no vote nor As a member of the Taxation deca he enjoy the full privileges of Committee which reported to Your a British subject-bis nationality is Excellency on April 5, 1939, I myself only xtremned for taxation purposes sent in to the Committee a memo- "The Colony is predominantly randum setting out in detail my own

Chinese. It hun therefore " deal objections,

alliance and a dual commitment.

"These have emphasised themselves in the Far East war that has been rnging for two years-n war which han profited some in the Colony, but bted the injority through economic wounds.

many

Committee's Doubts

Some of the grave doubts which

are widely felt as to the possibility of the successful administration of an income tax in the Colony were "No other part of the Empire has summarised in the Taxation Com- suffered this strain."

mittee's report, which include the following:-

Sense Of Injustico

They will find, tou, that the slogan "Hongkong is lightly taxed" was al- If my calculation is right, the

ready current in those early days! financial gain to the Colony aris-

The estimated revenue for 1007 ing from the Sino-Japanese con was $5,202,135, whiel

which apparently re- Gict, in respect of the period 1937 presented a somewhat serious decline to the end of March, 1011, comes on the previous year's revenue. The to the stupendous figure of $25, following quotation from Sir Mat- 351,152.

thew Nathan's address gives an in- Honourable members may be interesting historical background of terested to know that the total sub- the Colony's revenue position, and scriptions received up to October, constitutes not an unworthy guide to In connection with the above I 1939 by the British Fund for Relief us as to how the Colony's financial feel it my duty to give expressiori of Distress in China, Hongkong and dimeutties should be met in times, to the sense of injustice felt by many South China Branch, amount

ja to of adverse trade or economic uncer of the companies incorporated amount $401,074, and that the

of tainty:--

Hongkong which carry on business in expenditure

sanctioned afready

"Defere going into the long array Shanghai, Hankow and other parts comes to $406,170.

of figures which I have on may notes: af China. By the Defence (Finance) This Fund, of which Your Excel- I think it will meet your wishes Regulation 3B, Government has the: I explain generally how it is proposed right to acquire certain foreign cur- lency is Patron, is non-political, and purely philanthrople.

rencies from every British subject (as defined) resident in the Colony, and certain duties are imposed upori such a British nubject.

The flow of subscriptious to the Fund seems to be rapidly drylug: up, whilst calis on lis resources aro continuous.

May $022,052),

therefore, venture, to ex- press the strong hope that Your Excellency will see ft to making n substantial grant to this Fund as a friendly gesture of the Colony 10- wards the indescribable sufferings of the Chinese?

such matters deny that such trans-which are not a matter of record but 097,325 (including $839,704 trans- formation appears feasible, except perhaps at the expense of much are, nevertheless, an essential.

cunfusion and ultimate"defeat,"

which

foundation of the Colony's business!

if I may

have

The War Budget

I now turn to the War Budget. The Prime Minister, in the House

of Commons on October 12, stated:— " is not with, any' vindictive pur- pose we embarked on war but simply in ilefence of freedom. It i nut along the freedom of a sinali nation that is at stake. There is in Jeopardy the peaceful existence of Britain, the Dominions, India and the rest of the) British Empire, France, and indeed nil froodam loving counteles,"

This quotation bears *eloquent testimony to the force and meaning) of Your Excellency's observation In this Council on the same day, that "this is every whit as much our war ns it is Brlióin's."

And the complete realization of the implication of the war on the

to meet that decline.

"There are there methods' open to: us. Either to be further Jose, or to lagrouse taxatlon, or to reduce expenditure.

strongly voras to raising: additional loups at the present time I am also averse to increasing

taxation.

By this Regulation "British Sub- ject" includes every company incor- porated in the British Empire.

con-

3. The migratory nature of the Colony's population, and the extreme- ly mixed taxable community, with grently differing standards of living, innke Hongkong unsuited to the tax generally.

д

1.Many henefits are at to be derived from prosorving the Colony as a haven for "refugee" capital. The Coluny's prosperity depends to largo extent on the fact that it is the antrepot of Chine, a fruo port, without income tax and without ex connivo taxation.. An unwise, facul Imposition may well uprot (kin pra- carious prosperity.”

"0. Economic and Industrial deve- lopment particularly of smail, fac. torice as yet in their infancy-would bo wartously affected."

During the Sino-Japanese flict companies of the class I have! The Committee, whilst recom- mentioned have sought protection mending the introduction of income from the British Authorities, but tax in a certain eventuality “If it be such protection has, always been considered that the tax is capable of tho refused on the ground that such successful administration -companies, - though-registered in Culony," fell-It-necessary to qualify. the Colony, are not entitled to pro- this recommendation in five ways, specified in the report, from which I merely quote two:-

"It has been pointed out to e that this Culony is very lightly taxed, nad I by nu iseuns preminu that I xhall not on nome future occasion additional Imports, but n propune time like the present one when trade In hud does not seem a sultuḥle one -at-which-to-med-to-the- burdene-of:

traders. There remalas a reduc- tion of expenditure, and that is the method which It is proposed to adopt, "We must cut our cent necording to our cloth. It must necesarily be 'n simple garment but 1 hope when I which is a "British Subjec!" as de- como presently to try it on you, you fined by the Regulation, has proper- will agree with mo that it is a fairly) Ues in Canton, Swatow and Tolshan, serviceable one in which the Colony which were either burned or looted, need not feel ashamed to appear.next, or both..

модром.

"It is somewhat of a tight fit, but.

tection. tection.

In one case to my knowledge a company incorporated in Hongkong,

Patriotic Duty

"(x), The, passilsility of the suc cessful working of the tax should Arst be the subject of a detailed in- vestigation with the assistance of an expert, preferably familiar with the collection of the tax in on Eastern country.

("(b) Wo tool that it would be un- whe to impone a tax of this nature until a substantial body of solnion In the Colony bolfeves that the tox can bo Invied fairly and elciently." Should some of the misgivings re-

if we adhere to the estimates we have I have discussed these points-the framed we shall remain in the same lightness of Hongkong taxation and sound financial position at the end of the relative burdens between the 1987 as I am happy to say we shall, British and Hongkong tax yergarding this proposal, which are

bo in at the end of 1908,"

Britain And Hongkong

hot for the purpose of funding ex-

of property

The next gain to the Culony is therefore $5,383,815.

Coming, now, to 1930. The original estimated revenue was put at $30,-

ferred from Government House and Iwould-be Interesting-to-know-19 City Development Fund) Now this In spite of marked and, we hope tals and qualifications made by the the basis of the continued operation what extent the preliminary essen-estimate was obviously framed on permanent Industrialisation

Taxation Committee would has been noted in recent years, the beers augmented or emphasised had about such striking increases to the of the same factors which brought

is sull the merchant through whom it been asked to report on this par- Colony revenue in 1930. political business Bows from the ticular subject under the conditions

1045 I this argument is Bound us g outside world to and from the main-imposed on this Colony through be- think it is, then

# can be fairly ing itself involved in a state of war. stated that Innd.

the nett gain to the venture to surmise that what little Colony in 1939 must be approximate- I need perhaps not remind Your; Excellency that the bookkeeping for encouragement that Report may ly the same as in 1938, on the basis have given to the Government for of the original estimate, less any irt- the average Chinese merchant is divided into two very separate com- the introduction of the measure now, creased expenditure which had not would have been replaced by a been taken into account in the Estl- partments.

There in the general recording of solemn warning against it.

mate of 1939 Expenditure. transactions with the world at large,

Refugee Capital

Of the latter, as shown in Table 3 which is dealt with by the employees Attention has been sumciently of the Financial Secretary's Memor-

euses for us to try to get out cheap-indicated in the Taxation Commit- of what is known as "the outer drawn to the tramallory and migra- andum, the only item I can find re-

Great Britain and Hongkong, I cub- mission,

As regards comparisons between ly", but of showing that, in my sub-tee's report, prove to be true, then counter", but there is an additional tory nature of the capital-refugee lotes to Hend 5, Charitable Services

we should approach the the Colony might well suffer a sot- set of books which are kept in the capital,

so describe it (relief of refugees). In respect of part of the publle is reflected in it, Sir, that however Battering it question of the Colony's contribution back from which it might take her inner counter" by the proprietor or witich has found its way to this which the excess over original están- its ready acceptance of and full- may be to compare the Colony with to England as a matter of patriode very long time to recover. partners of the business maintained Colony in the last two years,

ale amounts to $1,241,739.

hearted co-operation in all the the Mother Country, the greatest and duty, freed from any

At all events, self-reproof

it is difficult to under conditions of extreme privacy, Investment and enterprise, includ-

*** wealthiest varied measures which Govern Europe, no useful comparison be- and uniroubled by any comparisons unpropitious than that now obtain- democratic country in that we have been too lightly taxed, imagine a set of circumstances more to which no employees have access) lug the transfer of manufacturing, £3,750,000 Nett Gain

ment has found t necessary or under any circumstances.

plant to Hongkong, has been stimu“ The nett gain to the Colony for

desirable to Introduce In this tween the two places from the point, made between 11ongkong and clse-5 for trying out an extremely We must try to realise that an|inted by a profound sense of security 1930, on the basis of the originai

Colony, ailliough many, if mot all, of view of flaent incidence can be where. official Invasion of the "Inner coun- and by satisfactory appraisement of estimate, is therefore, say, roughly of them must have a restrictive radical differences in government, in this spirit.

fairly made, having regard to the

I therefore approach the question ter" means to a Chinese business the benefits to be derived,

$5,000,000, less $1,241,730, i.c. $3,

effect on business, man a great deal more than the A disturbance of the enlculations 758,264.

institutions, economic resources and disclosure of his business secrets. and estimates which have preceded

First, as to the amount of the con- That residents in the Colony- To understand this we should up these wartime investments will un- venue of $40.175,246 shows an exceality should have to bear some fin- the commencement of this century of seven or eight million dollars, as

But the revised estimate of re irrespective of their rage and nation-social conditions.

tribution, In England the amount spent since

It must be appreciated that a gift | preelate that this privacy, which is doubtedly involve a consideration of of $4,377,023 over the original traditional, has no origin in uny | alternatives

ancial Forrifice, in order that should, of estimate, and if the sum transferred tribution might be forthcoming to on Health, Education. Housing and suggested by the Hon. Financla attempt to evade inxation or to mis- course, be our object to retain the from Government House and City the Imperial War Chest, Atting from Benefits, Poor Law Relier, Old A Secretary, to Great Britain can be

10 Social Services Unemployment advantages which this Colony so Development Fund ($130,704) the point of view of the Colony as Pension, Industrial Insurances, etc. carely needed.

deducted from this increase, the in a vital part of the British Empire amounts to astronomical figures. It is not a question merely of Uls Hon. Senior Unofficial Member that Estimate amounts to $3,538,219.

endorse the remark made by the ercase as shown by the Revised and worthy of a Colony which yields, closure of business secrets, of

to Bone in loyalty and devotion 10 university, thrnce to the highest past From the primary school to the sources of supply or of customers, the unanimous opinion of the Com-

the Crown, is inevitable. but of the breaking down of amittee and Members of the Hongkong

in the State, the path is open to the traditional element in business pro- Chinese Generul Chamber of Com

poorest lad with bralna. Here is a cedure which has been regarded for) merce adverse to the institution of

Professor H. A. L. Fisher, In ben-picture of post-war England by centuries fundamental form of income tax In this Colony. A copy

"History of Europe" (page 1210) security, and with it would go a of the Chamber's letter has been sent degree of confidence which might to Government through the

Hon. undermine the whole structure of Secretary for Chinese "Affairs.

I will conclude, as I began, with business life.

It may be said that the assess an nasurance that the responsible ments would depend only in part on elements of the Chinese community the investigations of books, and that are prepared to assist in every way there are considerable sources from they can in finding a solution to the which reliable and Indisputable In-urgent and special financial problems formation is available. These in-with which the Colony is inced, clude income from public invest- Alternative Methods ments; public or private companies,

Numerous methods of raising re from house properties, mortgages, venue alternative to Income Tax salaries (which are a matter of ro- have already been suggested, and in is put at $50,801,470. fecard by employers), and all income their consideration the

lead ometal inquiry,

Traditional Procedura

when

The total net increase to the Colony attributable to the Slip- Jopanese conflet for 1939 is there- fore $7,200,483.

The gain to the Colony in re spect of 1937-1939 is ascertainable and, on my calculation, amounts to a total of $17,080,298. The gain for 1040-1941 can only be an estimate, based on the estimated!

· ́ Budget Agures.

of 1040-

Coming, then, to the, prospective revenue and expenditure 1941. The estimated revenue, which "has been estimated generally on the assumption that the economic activity of the Colony will be maintained atj not far short of its present level".

It is, therefore, fülr to assume that]

from the Sino-Japanese conflet will No scheme will be attacked on not be less than in 1030, namely,} the ground that it inflicts hardship $7,200,403, plus a quarter of this or strain en any portion of the amount for the three months in 1941) community.

31,024,120, making a total of $9,120,-

Chinese

which is remitted from abroad and business community desires to be not the nett gain to the Colony arising which passes through recognised[critical but constructive. channels, such as Danks,

Whilst not agreeing that the pro- portion of these sources is as large as anticipated, the ability to inx that source does not, unless I misunder

But the opposition to the institu- 003, less any increase in expenditure stand the situation, provide any en- tion of anything in the nature of a attributable to the same causes not couragement.

tax on income or profits, which I budgetted for in 1939. There ariso numerous questions of now have formally to record, arlacs Of the latter, as shown in para rebates and allowances nuinly from the firm conviction that graph 11 of the Financial Secretary's "refunds,

which will have to be considered, as the disturbing effect of its introduc- Memorandum, the only stem I can the vast majority of cases such tion and the confusion attendant on ace which is directly attributable to class of income will not represent its administration will, by doing in the Sino-Japanese conflict is under the sole sources. A calculable harm to business interests, Head 3, Charitable Services, which In this Colony, except perhaps in defeat the object which it is obvi- shows on increase of $224,740, being the cop of foreign employees, in-ously the desire of the Government "increased; grants to the Tung Wah stances – must be comparatively few to attain.

Hospital and for relief of refugees"

сол-

Opportunity Welcomed Indeed, they should welcome the opportunity of making such a con tribution, for it is unthinkable that they would be content to render mere lip service to a cause, the result of which must have much a significance to Civilisation.

I am certain that there is a com- plete unanimity amongst all sections of the community on this point.

A recollection of the part which this Colony took in the 1914-1018) wan-Including the splendid res- ponse of fis cittacus to appeals for war charities and war loans, and the voluntary presentation to Eng- Iand of two Service deroplanes by certala Chiness resideals -renders 14 Imbomible for anyone to enter. lain any, doubt of the Colony's at tliade in this matter,

"At this time the British people boro without repining a burden of taxation honvler than that of any European country.

"The annual servleg of the debt, charge alone amounted to more than 300 million aterling.

controversial fiscal experiment, with its dangerous potentialliles.

need.

The Chinese in the Colony, who constitute some 97 per cent, of the population. have, for over 1wo years, been going through a severe financial strain In order to render badly needed assistance to their Mother Country In her. Lour, of

patriotism and of her willingness to certainty in the Colony's whole out only a gesture of the Colony's

That there is a depressing un- "do her Empire bit" as a part of the British look is the authoritative view of the

That sum represents only a few

Financial Secretary himself. hours of the Imperial War Expen Colony's revenue serve but to cloak

The

fortuitous increnses' In the diture, and nothing that the Colony the unsatisfactory position of the can give can be of arty material Colony's economy. financial assistance to England.

The light to the Colony of "re- luctant to discuss the quantum of years or so is due

This being so, I feel the less refugea" capital during the last two ПD doubt to proposed gift in relation to the Hongkong being "a free port, with- Colony's capacity.

out income tax and without exces A gift of 37.000.000 represents 21.5 alve taxation." per cent of the yearly average re- Its maintenance in the Colony de- venue for the past ten years of 324 pends on a delicate equilibrium of million.

confidence and of opposing and com- It to this amount wo were to petitive Anancial attractions und add lie special Defence expendi-drawbacks, which may casily be up- ture of 21⁄4 million, auð`tho NIII- "set.

the

tary Contribution of six million, With the dislocation und diminution the total amount would come to of trade caused by the war, and by $15.250,000 which is 40.0 per cent the necessary war measures; -with

of the yearly average of 324 mall-† unemployment caused by the closing

on.

down of enemy businesses; with a "tad" property market, and a "moribund" share market; with a low

Too Much For Colony

"Fifteen_years after the end of the war the State levied 4r. 6d. in the "pound on the income of the tax payer Irrespectivo of the supertax on 3n- como exceeding £2,000 a year. "Yet it is characteristle of the democratie spirit which prevailed in the country that, despite bad trade and crushing tuxatlon, the level of the social services, higher than that Which prevailed in any other coun- try and more expensive, was not seriously lowered.. That the health, the people should be well cared for tion and to the Imperial needs at general, and in face of reduced earn- Ing regard both to the Colony's post- increase in the cost of living in But I feel it my duty to make it was common ground with all parties the present time. quite plain that, in my view, the

In the State." reason why the people of the Colony

I venture to think that for 1040, ings-the outlook for the Colony is desiro so keenly to "do their bit" is We are naturally proud of the comre

Proud Of Progross

ond until the Colony's position be indeed bleak.

Hitle more clarlfled, the gilt because they are animated by senti- wonderful progress which the Colony to England should not exceed $3,000, that the Colony's contribution can be ments which I have just endeavoured has made under Britials Rule willin

*** Killing The Gooso I am satisfied for my own mind to express, and not becausé agree with the statement, which has And yet, what is Itaposition to Colony should make the best contri-curring the risk of "killler the goose

they the short space of a century.

As we are all agreed that the raised by other means without : in- been made in this Counell, that the day? Substantially a non-producing button of which it is capable, the that lays the golden eggs Colony is lightly taxed, nor because county the Colony all depende problem confronting this Council of they can regard as otherwise than mainly on its being an antrepot for solves itself to one of finding the beat other alternatives will obviate the I may incidentally point out that superficial the comparisons, which its continued prosperity. Though teans of raising the money.

PLEASE Turn To Page 9.

I cannot help thinking that the dollar and rapidly Increasing costs of

the education, and the housing of gift is too much for the Colony, have imported goods and a concomitant

"Light" Tax Burden

000.