APPENDIX   X.
 

               (Circulars  published in England.)



                  TAXATION  IN  CEYLON.  (I.)



     MEDDLING AND MUDDLING OF THE SECRETARY OF STATE.



Lord Knuisford, as Secretary of State for the Colonies, acting in opposi¬

    tion to the ojrinion of five ex-Administrators of Ceylon affairs, and

    retaining a Id per cent. Customs Buty  on rice affecting the poorer

    natives, while abolishing the  Excise Rent of the land-oiuning  rice

    cultivators, and increasing the most obnoxious of all taxes—that on

    Salt.



          A Royal  Commission of Inquiry called for.

(1) Lord Knutsford, Hor Majesty's Principal Secretary of  State for

the Colonies, has recently decided that the rent, or tax, hitherto collected

on the rice fields of Ceylon, popularly known as the " paddy tax," is to

be abolished from 1st January next ; while it is announced that the

Customs duty on rice imported from India, the staple food of the people

in the towns, of the Tamil coolies on the plantations, and of some of the

very poorest, because landless, people in the villages, is to remain intact.

  (2) Nearly the whole of the  net amount of the paddy rent received

of late years in Ceylon has been spent in restoring Irrigation Works and

in promoting Irrigation generally for the benefit of the  poorest and most

backward native districts.   In round numbers the two levies  on  rice

may be said to have yielded gross revenue as follows :—



      Customs Duty, rising to     ......    Rupees 2,200,000

      Paddy Rent     „    „      ......        „   1,000,000



   With the paddy rent abolished, the import duty proposed to be retained

will of course be paid chiefly by the people who possess no land of their

own, and yet out of the proceeds of this tax, Lord Knutsford proposes

henceforward to take  votes for  Irrigation Works  for the benefit of rice

cultivating natives.  A greater anomaly, or a more.unjust proceeding in

respect  of the poorer natives  in the towns and  villages, was never

heard of.

   (3) The writer is among those who (with five past  Governors of the

Colony,  nearly all the members  of the  Civil Service, and many old

residents  both native and European) have felt  that  the proper time

would not arrive for superseding these rice taxes, by more direct scien¬

tific levies, until popular education and  facilities in transport by roads

and railways had been more extended in the Island, and a good  deal

more public money had been spent on Irrigation Works.

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