ENG-1966 — Page 70

FINANCIAL STRUCTURE

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with the amount charged but averaging about 22 per cent. Certain types of entertainment given for charitable or educational purposes are taxed at a lower rate or may be exempt. Public Dance Halls Tax is a levy of 10 per cent on all dance halls charges. Bets and Sweeps Tax imposes 74 per cent on totalisator receipts and 25 per cent on cash sweepstake receipts.

A Hotel Accommodation Tax was introduced during the year to provide money for the organization of tourism. The charge became effective on 1st July 1966. The rate of tax is 2 per cent of the charge made for accommodation by the proprietor of any hotel containing 10 or more rooms normally available for the lodging of guests. This levy is estimated to yield $1 million in the current year.

Every business carried on in the Colony, except one which is not carried on for the purpose of gain or one which is carried on by a charitable institution, must be registered and pay annually a registration fee of $25. Where the business is very small the Commissioner may exempt it from the fee. These fees are expected to yield approximately $3.1 million.

CURRENCY

When Hong Kong was founded in 1841, China's currency was based on uncoined silver. The normal unit for foreign trade throughout the Far East was the Spanish or Mexican silver dollar. By a proclamation of 1842, Mexican or 'other Republican dollars' were declared to be legal tender in the Colony although government accounts were kept in Sterling until 1862. There were several unsuccessful attempts to change the monetary basis from silver to gold.

A mint was set up in 1866 and produced a Hong Kong equivalent of the Mexican dollar, but the new coin was unpopular and the mint closed down two years later. The machinery was later sold to establish the first modern mint in Japan.

An Order of the Queen in Council, dated 2nd February 1895, authorized the minting in India of a British trade dollar, equivalent to the Mexican dollar. In Hong Kong this gradually replaced the Mexican dollar although the latter still remained both legal tender and the standard by which other dollars were judged. The Sterling or gold value of the dollar varied with the price of silver. This