No. 150.
Mr. Avery
to Mr. Fish.
Legation of
the United States,
Pelting, March 30, 1875.
(Received May 25.)
No. 44.]
Sir: On the 3d instant the customs taotai of
Tientsin issued a proclamation, requiring all consignees of native goods by
foreign vessels to report the same for payment of local taxes, or likin, immediately after their discharge from the
foreign customs.
As the previous rule was to collect the likin only
after the clearance of the goods from the native hongs, or shops, for the
interior, the effect of the new order would be to shift the impost from
second to first hands. This fact alone would have excited much protest, and
reacted upon the commerce of the port; the proclamation, which was addressed
to “Al
[Page 289]
merchants and shop-keepers
concerned with entering imports at the customs,” was believed to apply to
foreign goods consigned to native merchants, in which case its effect would
have been, virtually, a large increase of customs-duty in violation of
treaty. Native consignees at once declined to take delivery of their goods,
and foreign merchants appealed to their respective consuls. As the river had
just opened, after three months’ ice-blockade, and a considerable fleet of
goods had arrived, the great accumulation of goods lay idle, the commerce of
the place was arrested, and there was ample ground for remonstrance and
explanation. Mr. Eli T. Sheppard, United States consul, acting in concert
with his colleagues, therefore waited on the customs taotai, when that
officer indignantly denied that his proclamation was meant to apply to
foreign goods, and agreed to issue another proclamation, which duly
appeared, setting forth explicitly that the new rule applied only to “Native
merchants, or importers of native cargo, and has no bearing on foreign
goods.”
Mr. Sheppard’s dispatch to me, of which copy is inclosed, gives all
particulars of the trouble up to this point.
The second proclamation relieved the apprehensions of the foreign merchants,
and as there seemed no reason to question the right of the Chinese
authorities to levy or collect native taxes as they saw fit, nothing more
was asked.
But the native merchants combined to resist the new rule. They held a
meeting, and resolved to close their shops, and petition the higher
authorities; which they immediately did. The sudden stoppage of trade threw
large numbers of the common people out of employment, and they evinced their
anger in a manner that threatened the peace of the city.
Foreign trade of course was equally suspended, and in view of this fact, and
of the danger to be apprehended from popular tumults, I suggested to Mr.
Sheppard the propriety of inviting the consular body to join in friendly
representations to the high officials on the subject. The prompt action of
the governor-general on the application of the territorial taotai
fortunately rendered foreign intervention unnecessary. The obnoxious rule
was set aside, and likin payments ordered to be made
as before; whereupon the native merchants took delivery of their goods,
which had accumulated in great quantities on the bund, and commerce resumed
its usual course.
During the excitement it was freely charged that the customs taotai, who was
about to be removed, was actuated by a desire to enrich himself by a parting
extortion at a time when the re-opening of navigation promised a rich
harvest.
Be this as it may, the prompt overruling of his obnoxious requirement
undoubtedly prevented serious trouble.
I have, &c., &c.,
[Inclosure in No. 44.]
Mr. Sheppard to Mr.
Avery.
United
States Consulate,
Tien-tsin, March 15,
1875.
Sir: About ten days ago my attention was called
to a proclamation which had just been issued by the customs taotai of
this place, notifying a change in the heretofore-existing regulations in
regard to the collection of native taxes upon goods imported at
[Page 290]
Tientsin on foreign vessels;
and on the 9th instant I received a letter from the local agent of
Messrs. Russell & Co., at this port, complaining that the sudden
change in the mode of collecting native revenue had created such alarm
among native consignees that they had refused to take delivery of their
cargoes; and also representing that a continuance of the then existing
state of affairs would lead to a commercial panic, and great consequent
loss to their company. Simultaneously with this, I was unofficially
informed that serious apprehensions were entertained by all the foreign
merchants residing here that the new regulations established by the
taotai, requiring the payment of local taxes immediately after their
discharge from the foreign customs, was intended to apply to and be
enforced against foreign goods equally as with native imports; indeed,
several of the foreign merchants of other nationalities had made formal
complaint to their consuls that the taotai’s deputies had already waited
upon them, and notified them to report their own consignments of foreign
goods to the native revenue-office for taxation.
All the Chinese importers of foreign goods were unanimous in saying that
they had been given to understand that it was the purpose of the taotai
to compel the immediate payment of the local tax, without reference to
whether the goods were intended for inland transit or local consumption,
and for this reason they all alike declined to take delivery of their
consignments until the matter was definitely settled. As is usual at the
opening of navigation each year, large consignments of foreign goods
were arriving daily from Shanghai, fulfilling the accumulated orders of
the past winter.
The taotai’s proclamation appeared simultaneously with the arrival of the
first steamer. The result in the immediate vicinity of the shipping was
magical. In three days the entire cargoes of eleven steamers were piled
upon the bund, extending and blocking the way along the whole length of
the British concession.
The serious consequences likely to result from such a state of things can
be better imagined than described. A sudden fall of snow or rain would
occasion great loss and endless litigation. This, however, is nothing
compared with the serious detriment to the trade of the port, which is
always likely to follow such a sudden shock. It had become apparent that
some action on my part and that of my colleagues was demanded in the
interest of foreign trade, aside from any individual interest. For the
purpose of obtaining the most reliable information respecting the
proposed new regulations, and in order to place myself in a position to
take suitable action in case it should seem advisable, I asked and
obtained an immediate interview with the taotai at his yamen.
He evidently anticipated the purpose of my visit, and seemed to be
greatly concerned. He introduced the subject at once, by declaring that
he had no intention whatever of interfering with foreign trade in the
least, and adding that his action had been willfully misrepresented by
the native merchants. He assured me that the new regulation which he had
just promulgated was an old rule, in existence since 1860, and which had
simply fallen into disuse by the lapse of time.
For your better understanding of the whole question, I beg to hand you
herewith (inclosure No. 1) a memorandum of what passed between the
taotai and myself upon the subject.
Having thus received the solemn and repeated assurance of the taotai that
his action was in no way intended to burden or fetter foreign trade, and
that no unusual or wrongful restraint was thereby directly imposed upon
it, I did not feel justified in taking any measures beyond suggesting to
him in a friendly way that it would have saved great inconvenience and
some loss if he had prepared the way for the change by a timely notice
of his intention beforehand.
It seems to me that, so long as the status of foreign trade is not
directly affected thereby, that it is beyond the power of a consul to
interfere with matters which pertain exclusively to the collection of
the native revenue. I, however, took especial pains to point out to the
taotai the possible danger to which foreign interests are exposed, and
the consequent evils which might result to the foreign trade of the port
by hasty or violent changes in the method of administering the local
revenues.
In order to prevent any further misunderstanding, the taotai on the same
day issued a second proclamation, distinctly disavowing any intention
whatever of imposing any new or additional taxes upon foreign goods; a
copy of which (No. 2) I beg to inclose herewith.
I am glad to inform you that after the issue of the last-named document
the native consignees came forward promptly and began taking delivery of
their consignments, and, so far as I am advised, business is resuming
its wonted activity.
I hope that my action meets your approval. I am, sir, your obedient
servant,
Hon. B. P. Avery,
United States Minister, Peking.
[Page 291]
[Subinclosure 1 in No. 44.]
Memorandum of an interview between E. T. Sheppard,
United States consul, and H. E. Sun, customs taotai at
Tien-tsin.
Tien-tsin, March 9,
1875. (3 o’clock p.m.)
On sitting down with the taotai in his yamen, the taotai at once
anticipated the object of Mr. Sheppard’s call by saying that there had
been willful misrepresentations made as to the new regulation for the
collection of revenue-taxes, but that he was taking measures to have it
rightly understood.
Mr. Sheppard inquired if foreign goods were included within’ the new
rule.
Taotai. “Most decidedly not. It was distinctly stated in the proclamation
that native goods only were meant.”
Consul. “Chinese merchants have refused to take delivery of their foreign
goods brought here by the steamers. In consequence, many hundred bales
of such goods are now lying on the bund exposed to the weather. Can you
explain this action of the merchants?”
Taotai. “Those men are chiefly shipping-agents and brokers, and they have
combined to defy the law if they can. It is they who have caused loss to
the revenue by evading the regulations and by smuggling. They distinctly
understand that only native goods are referred
to. I notified them all a week ago that this rule was to be enforced;
that they had been evading the taxes, were liable to punishment, and
must make good the duties they have withheld. This they have refused to
do, and are liable to punishment therefor. The revenue cannot be
collected fairly under the present system; there is a large yearly
deficit, and this is caused by smuggling and many ways of fraud. I
simply intend to enforce a regulation made by H. E. Chung-How years ago.
Under that regulation the Chinese merchants see that they will have to
pay their duties fairly, and those who object to this are now trying to
get foreigners to interfere in their behalf. They falsely tell
foreigners that foreign goods are included as well. But this is not so,
as my proclamation will show.”
Consul. “I hear that Messrs. Cordes &, Co. were notified to the
contrary by some of your subordinates.”
Taotai. “That was a mistake, and it happened in this way: I sent written
notices to all the merchants some days ago, and among these notices was
one my messenger thought was for a Chinese connected with Cordes &
Co., and therefore he went to that person. When I heard of this, I
recalled the messenger and reprimanded him for his fault.”
Consul. “I was also told by one of the gentlemen in foreign customs that
foreign goods were included.”
Taotai. “They were greatly mistaken, as my proclamation will show. Mr.
Twinenr has been here to-day, and will tell you differently.”
Consul. “I will explain that it is not my purpose or my duty to interfere
in matters which wholly pertain to the Chinese. Chinese officials must,
of course, regulate native trade in their own way, and adopt what rules
they think best to protect their own revenue. So long as the status of
foreign trade is not affected by such changes, I can have nothing to
object. But I submit, as a friendly suggestion, that it might have saved
inconvenience and prepared the way for this change, if timely notice had
been given beforehand. The trade in native goods, at this port, is now
very large, and forms the bulk of the freight carried by all steamers
coming here. If this trade is suddenly checked by anything done here,
great losses will result to both foreigners and Chinese.”
Taotai. “This is no new regulation, but rather the enforcement of an old
one which has been systematically evaded. It was made by H. E.
Chung-How, years ago, and was in force during his time. Triplicate
certificates were then given at the foreign customs for all native
goods, and these certificates were used in paying the revenue-taxes just
in the way I intend to have them paid in future. During my predecessor’s
term of office, his deputies and underlings managing the revenue
business gradually and secretly introduced a system of compounding with
the merchants for their taxes, receiving bribes and winking at frauds.
All this time triplicate certificates were issued as usual, but were
suppressed by the deputies. I have since obtained possession of a
complete file.
“This will show that the regulation has always been nominally in force,
but practically evaded. The merchants have known this, but have found it
more profitable to sustain the corrupt system. On taking charge of this
office I soon discovered the fraud, and made a clean sweep of the
participators in it. I found a large yearly deficit in the revenue, and
saw that there was no way to protect the revenue save by enforcing the
regulation wisely made years ago. On deciding to do this I notified the
merchants of my purpose, and warned those who had withheld duties to
come forward and pay up, when the .punishment they had incurred would be
remitted. This invitation was unheeded, and
accordingly I issued my proclamation.
“I have drawn up another proclamation, to be issued at once. In it I
state distinctly
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that native
goods only are referred to, not foreign goods; that certain
mischief-makers have been busily circulating false ideas, and that I
will be after such people, and make them repent their folly. I will
state too that the merchants must take delivery of their goods, or I
will oblige them to do so.” (The taotai was under the impression that
Chinese merchants had been to complain to Mr. Sheppard.)
Consul. “I would recommend you not to mention that. I should think it
better to let them choose for themselves about taking delivery, and not
coerce them on that point. I must tell you that no Chinese have come to
me to complain. Had they done so, I could not have acted for them in
this matter. Complaint was made to me by American merchants, and it is
for them that I speak.”
Taotai. “Well, then, that point need not be referred to in the
proclamation.”
Consul. “I will consult with my colleagues on my return. I do not know
whether their views differ from my own, but, if it should appear
necessary, I will write you on the subject. I hope to receive a copy of
your new proclamation.”
Taotai. “I will send you a copy without fail.”
Interview closed at 4 o’clock.
[Subinclosure 2 in No.
44.—Translation.]
Proclamation of the Taotai.
Tien-tsin, March 9,
1875.
Sun, customs taotai, &c., &c., makes the following
proclamation:
Chinese merchants who receive consignments of native imports have of late
been disregarding the regulation established by H. E. Chung-How,
ex-superintendent of trade, which requires that after duty has been paid
at the foreign custom-house, the triplicate certificates there given
shall be taken to the revenue office, for the payment of the
revenue-taxes; and the result of this has been that smuggling has been
carried on at pleasure. For this reason the existing regulation was
promulgated in a special proclamation, wherein it was distinctly stated
that native goods belonging to Chinese merchants, and not foreign
goods, were referred to.
It has come to my knowledge that unprincipled native merchants have been
circulating canards to the effect that all foreign goods, whether
intended for local consumption or transit to the interior, after paying
duty at the foreign custom-house, must be reported at the local
revenue-office and pay the duties there. These people presume to take it
upon themselves to leave all their foreign goods on the bund, and refuse
to take delivery; and they designedly instigate foreign merchants to
take action, hoping in this way to resist payment of taxes on native
goods. Such malignity is utterly detestable.
I have sent police to vigorously but secretly track out and arrest such
offenders, and have also communicated with foreign consuls on the
subject.
This proclamation is now issued for the information of all merchants
concerned. Hereafter, when native goods imported by foreign steamers or
sailing-vessels have paid duty, and been cleared at the foreign
custom-house, they must, according to the regulation for triplicate
certificates, be reported the same day at the head revenue office for
payment of revenue-taxes.
Should any one presume to secretly engage in smuggling, he will, on
detection, be unrelentingly punished according to law.
Obey with trembling!
&c. &c. &c.
