CHINA. 



ueeoiint of the destruction of mission property. 

 This did not include the sums exacted from local 

 authorities to indemnify native Christians. 

 American Protestant missionaries collected in- 

 demnities from local authorities and individuals, 

 and the money thus paid the United States Gov- 

 ernment proposed to reckon ui abatement of its 

 total claim. Local mandariia were willing to 

 make voluntary coinpen>atiod in order to keep 

 their names out of the black list of guilty officials, 

 and wealthy men and villages would pay to ob- 

 tain immunity from the visitation of foreign sol- 

 diers. The sums exacted, amounting to many 

 millions of taels. and the methods employed to 

 compel payment aroused fresh hatred against the 

 mih#ionari*es in the northern and central prov- 

 inces. Germany increased her claim later to $70,- 

 O4HUHK) on account of the prolonged military oc- 

 cupation. Great Hritain was willing to agree to 

 a reduction of the indemnities all round, and 

 Ku>ia and Japan were non-committal. All the 

 other powers rejected the proposal of the United 

 States, .lapan made a request to be allowed to 

 increase her vlaim to cover the depreciation of 

 Japanese bonds issued to defray the cost of the 

 exjM'dition. Other powers came in with increased 

 demands when they saw that their allotments 

 were likely to be disturbed, and Japan thereupon 

 withdrew the request, although it was strongly 

 backed by the United States and regarded with 

 favor by other powers. 



The committee of ministers discovered that the 

 total imperial revenues amount to about $65,000,- 

 000 in gold per annum, of which $14,000,000 are 

 derived from the land tax, $12,000,000 from the 

 Imperial Maritime Customs, and the rest from 

 the grain tax. salt gabels, likin dues, opium tax, 

 and miscellaneous sources. Foreigners thought 

 that the land tax might be doubled or trebled 

 without producing hardship, the salt tax raised 

 from $41.000,000 to $20,000,000, and the total rev- 

 enue increased to $150,000,000, while Government 

 expenses could be cut down to $45,000,000, leaving 

 $105.000.000 a. year with which to pay interest on 

 foreign loans. The committee of foreign minis- 

 ters found that the maritime customs, amounting 

 to between 28,000,000 and 29,000,000 taels, were 

 practically exhausted, 24,000,000 taels being ab- 

 Horbed in paying interest on the existing external 

 loans, 2,500,000 taels in the maintenance of the 

 staff of foreign employees, 120,000 taels in sup- 

 porting the university, and 1,300,000 taels in keep- 

 ing up the Chinese legations abroad. The com- 

 mittee recommended for the service of the new 

 loan an increase in the customs duties to 10 per 

 cent., yielding from 10.500,000 to 18,000,000 taels; 

 a salt tax. yielding from 4,000,000 to 20,000,000 

 taels; a Pekin octroi, yielding 500,000 taels; a 

 commutation of the rice tribute, yielding from 

 1.000.000 to 8.000.000 taels; the abolition of the 

 Manehu pensions; .and the reduction of military 

 The committee recommended that the 

 indemnity loan be guaranteed by the powers, en- 

 abling China to pay the required (55,000,000 by 

 borrowing 70,000,000 at 4 or .4* per cent 

 whereas on the strength of her own credit she 

 I have to issue a 5-per-cent. loan of 85,- 

 Ihe members of the committee were 

 from being unanimous in recommcnd- 

 tne financial scheme as in the estimates 

 of the yield of the proposed taxes, which varied 

 from 21.500000 to 01.500.000 taels. The land tax 

 and the likin they thought ought not to be 

 touched. If they were divided in opinion the gov- 

 ernments were still more so. The proposal to raise 

 the customs tariff to 10 per cent, ad valorem 

 s from Germany, and was supported by the 



other powers excepting the United States, Great 

 Britain, and Japan, the only three besides Ger- 

 many that have important trading interests in 

 China. Such an increase has been contemplated 

 for a long time, but only in connection with the 

 abolition of likin duties and other hindrances to 

 commerce with the interior and the establishment 

 of new treaty ports, throwing the whole of China 

 open to foreign trade, in which case the in- 

 creased receipts must go to reimburse the local 

 authorities for their loss of revenue. Otherwise 

 the effect would be to build up immense manufac- 

 turing interests in China, which, with foreign 

 capital and superintendence, the newest modern 

 machinery, and cheap Chinese labor, would under- 

 sell every other manufacturing nation. Russia 

 was much more urgent than Germany in pressing 

 for the increase in the tariff, for the blow to sea- 

 borne commerce would be an advantage to Russia 

 by increasing the overland trade with Russian 

 possessions. France would also benefit by the di- 

 version of commerce to her possessions south of 

 China. Sir Robert Hart recommended as new 

 sources of revenue a stamp tax, to produce an- 

 nually 5,000,000 taels; a tax on native opium, to 

 produce 10,000,000 taels; and a house tax, to 

 produce from 20,000,000 to 80,000,000 taels. These 

 new taxes were intended to supply. the deficiencies 

 in the imperial revenues caused by China's in- 

 creased indebtedness to foreign powers. As se- 

 curity for the indemnity loan the Director-General 

 of Customs, who has been a financial adviser of 

 the Chinese Government for over thirty years, 

 proposed an excise duty on salt, which would pro- 

 duce from 15,000,000 to 20,000,000 taels a year; 

 a customs duty to be paid by Chinese junks, 

 which would yield from 3,000,000 to 5,000,000 

 taels; an octroi at Pekin, if needed, producing 

 500,000 taels; the abolition of the Manehu sti- 

 pends, amounting each year to 3,000,000 taels; 

 and the commutation of the grain tribute into 

 money, giving 2,000,000 taels. Sir Robert Hart 

 proposed that the indemnity be paid by annual in- 

 stalments, each power accepting Chinese bonds for 

 its portion of the total sura. Several powers, how- 

 ever, objected to this method because they wanted 

 their portions immediately, and it was feared by 

 others that individual powers might intervene 

 in China for their aggrandizement if China failed 

 to meet her obligations promptly. Sir Robert 

 Hart thought that the likin and salt duties should 

 be collected by the Maritime Customs Depart- 

 ment. The new taxes he suggested in deference 

 to the objection of Great Britain to an immediate 

 increase of the customs tariff to 10 per cent., 

 which in pounds sterling is about the same as 

 5 per cent, was when the duties were fixed in 

 accordance with the Tientsin treaty; but by 

 doubling the tariff rates and gradually abolish- 

 ing likin he thought that China would be able to 

 pay the debt without difficulty by reason of her 

 expanding resources. The duties were fixed in 

 1861 at 5 per cent, ad valorem, but the valuations" 

 adopted then and since have converted them into 

 specific duties which are at the present time only 

 2i to 3_| per cent, ad valorem. Great Britain and 

 the United States could not object by way of com- 

 promise to such increases in the specific duties as 

 would make an effective 5-per-cent. rate. This 

 was the recommendation of the committee of 

 ministers in case a 10-per-cent. tariff was not ac- 

 ceptable, and they proposed to assign further to 

 the payment of the indemnities the native cus- 

 toms and to impose duties on certain articles that 

 have been imported free, such as butter, flour, 

 cheese, foreign clothing, and spirits. The esti- 

 mates of what these sources would produce varied 



