"In addition to the general tariff duties tonnage, navigation, and harbor dues are to be found in almost every colony. "The purely local and municipal expenses are defrayed to a large extent by the octroi de mer. This is a tax on all kinds of commodities, especially articles of food coming by water. It takes the place of the local octroi in the mother country. The octroi de mer, however, can not be fixed independently by the colonies. They have indeed the right of formulating the tentative scheme, but their decision must obtain the approval of the council of state in Paris, not only as to the tax itself, but also in respect to the methods of administration. "Of the remaining revenues, in addition to those derived from taxation and tariff duties, the third class comprises the income from colonial property. The most important element in this is the revenue from the postal and telegraph system, which is everywhere a government monopoly. The fourth and final category of colonial revenues is composed of the conventions or subsidies from the home Government which have been considered above. CONCLUSION. "From this slight summary it will be seen that the French Government wavers between two lines of policy. On the one hand, the movement toward local autonomy has granted the colonies substantial rights of fixing their own sources of revenue and expenditure in accordance with the dictates of local expediency. On the other hand, the movement toward centralization or so-called assimilation has taken away from the colonies the privilege of levying their own tariffs, and has imposed upon many of the dependencies a system of taxation more suitable to the interests of the mother country than to those of the colonies themselves; has declared certain of the colonial expenditures obligatory; and, finally, has complicated the relations between the colonies and the home Government by a series of subventions on the one hand and of contingents and contributions on the other. The most recent and enlightened colonial administrators themselves plead not only for a simplification of the relations between the colonies and the home Government, but also for a larger share of independence and initiative on the part of the colonies themselves." Subvention to the local budget of French Kongo. Subvention to the local budget of Madagascar...... Subvention to the local service of certain colonies Subvention to the railway and ports expenditures of Réunion. Subvention to the railways expenditures of the French Soudan Fourth annual installment of the fourteen installments to agricultural establishments founded by French settlers. 2,353, 000 1,800,000 765, 307 2,508,500 768,000 1, 270, C00 2,000 210,000 28,000 10,000 75,000 360, OCO Colonial troops and technical committee.... Colonial police.......... Colonial commissariat Maritime registry (inscription maritime) Colonial auditing Sanitary service (salaries) Sanitary service (office expenses and material) MILITARY EXPENDITURES. 5,799, 372 1, 630, 000 871,500 60,000 346,000 1,092,000 1,474,000 3,310, OCO Subvention to the franchised cable company connecting St. Louis in Sénégal and the possessions on the Rio Nunez, Grand Subvention to the franchised cable company connecting France with America and the West Indies. 2, 649, 500 4, 129, 900 1, 170, 000 1,439, 900 91, 633, 530 11, 258, 000 6,083, 688 3, 108, 936 1,925, 640 500,000 300,000 400,000 23, 576, 264 Francs. 9,570 7,992 2,410 2,410 11, 821 33, 619 25, 780 300 2,000 469, 472 GERMAN COLONIAL FISCAL SYSTEM. The statement which follows is from a paper on the “German Colonial Fiscal System in the Far East," prepared by Mr. Isadore Loeb, and published as a part of a series issued by the American Economic Association in August, 1900, under the title of "Essays in Colonial Finance." "The German colonies are of comparatively recent origin. Until the last quarter of the present century the Germans were not in a position to pursue a colonial policy. Lack of internal unity was a bar to the realization of this as well as of other international "The action of the German Government was hastened by the fact that the African continent was being taken possession of by the other European powers. Germany took an active part in bringing about the Berlin conference of 1884, which resulted in the Kongo act of 1885. This act established the principle of free trade in the valley of the Kongo, and defined the conditions which must exist in order to render valid the future seizures of unoccupied territory in Africa. "A negative policy was not sufficient. An active propaganda in favor of the acquisition of colonies was being carried on by individuals and associations in Germany. Before the meeting of the Berlin conference the German Government had commenced to acquire colonies by taking possession of districts through its officials or by granting the protection of the Empire to individuals or associations which had acquired interests in certain territory. By the close of 1885 the following districts had been acquired: Togo, Cameroon, German Southwest Africa, German East Africa, Kaiser Wilhelms land (New Guinea), Bismarck Archipelago, and the Marshall Islands, including the Brown and Providence islands. In November, 1897, the German Admiral von Diedrichs took possession of Kiauchou Bay in the Chinese province of Shantung. In the resulting treaty of March 6, 1898, China ceded to Germany for a period of ninety-nine years the exercise of all rights of sovereignty in the treaty district. In February of 1899 an agreement was made with Spain for the purchase of the remaining Spanish islands in the Pacific. By the treaty of June 30, 1899, Spain ceded to the German Empire the complete sovereignty over the Caroline Islands and the Palau and Marianne Islands. TRADING COMPANIES UTILIZED TEMPORARILY. * * "It was not the purpose of the Imperial Government to take over the immediate administration of the colonies. In some of the districts private corporations had concluded agreements with the native rulers, by virtue of which the latter ceded rights of jurisdiction as well as economic privileges. The policy of the German Government was to avoid the development of an expensive machinery of colonial administration by placing the rights and obligations of government in the hands of trading companies which had acquired economic privileges in the territory. This policy was carried out in German East Africa, and in a district including Kaiser Wilhelms Land, Bisayarck Archipelago, and the Solomon Islands. In each district a charter (Schutzbrief) was given to a colonial company, granting or confirming its right to extensive economic privileges and to the exercise of governmental powers with such district. In the Marshall Islands a similar principle was followed; but in this case the administration was to be conducted by imperial officials, the costs of such administration being borne by the company (Jaluitgesellschaft). "The Government was unable to extend this programme to other districts. The companies which were engaged in undertakings in the other colonies were not organized for the exercise of such functions, and were unwilling to assume such grants of power with the resulting obligations. The companies which had received the charters had not solicited the grant of governmental functions, and were anxious to be relieved therefrom. In 1890 the German East African Company concluded an agreement with the Imperial Government, by virtue of which it renounced all of its governmental rights. Attempts to bring about the same result in the territory governed by the New Guinea Company had failed. The Diet was unwilling to assume the expenses of government while the company retained its extensive economic privileges. Recently, however, a satisfactory agreement was concluded, and on April 1, 1899, the government of the district was taken over by the imperial authorities. Thus all of the colonies became subject to the immediate control of the German Government. * * * THE COLONIAL SYSTEM DESCRIBED. "The imperial chancellor, as the personal and responsible representative of the Emperor, stands at the head of the colonial administration. The entire administrative organization for the colonies has been created by ordinances of the Emperor, the chancellor, and the colonial officials. The colonial department, consisting of a director and a number of councilors and assistants, has supervision and control of the entire colonial administration. It is a division of the foreign office, but is immediately responsible to the chancellor in all matters affecting the internal administration of the colonies. In matters affecting foreign relations the department is subject to the foreign office. There also exists a colonial council, the members of which are appointed by the chancellor from those who are exceptionally qualified for the consideration of colonial matters. The colonial council considers measures affecting the administration of the colonies and gives opinions upon questions and policies that are submitted to it. It passes upon the draft budget of the colonies. "The administrative organization in the individual colonies varies with the development of the colony. In each of the colonies a governor is placed at the head of the administration. The governor is provided with officials for the judicial, financial, and general administration. A colonial military force exists in nearly all of the colonies. Where the colony has been divided into districts an official is placed at the head of the local administration, and the same is true of the municipal organizations. "The governor in each of the colonies, and in German East Africa the chief justice and the chief of the financial administration, receives an imperial commission. The other officials are commissioned by the chancellor in the name of the Emperor. The chancellor may delegate this function to the governor so far as it applies to subordinate officials. Natives assist in the local administration, and a large item in each budget is for the payment of the services of colored employees. "No particular provisions exist respecting the training or preparation of colonial officials. The policy of the administration has been to take officials from the home departments, which insures the necessary technical training. For colonial officials this is not sufficient. It is in the highest degree essential that they should possess a knowledge of the language and characteristics of the natives with whom they will have to do. A knowledge of the special geographical features, including climatic conditions, will materially promote their capacity for successful administration. While the Government has not adopted compulsory provisions, it has provided ample means to enable persons to acquire such information and preparation. The Oriental Seminar, which was established by the Prussian Government in 1887 and is connected with the University in Berlin, offers exceptional facilities for instruction in the languages of oriental nations and the native languages of the German colonies. In the winter-semester, 1899-1900, sixty-one courses were offered, embracing fifteen languages. Instruction is also given in tropical hygiene, geography of the African colonies, and economic botany of the Tropics. Persons preparing for the colonial service have taken advantage of these opportunities, and it may be expected that in the course of time colonial officials will be required to have such preparation. * * * "The ordinances affecting the internal administration of the colony are in general issued by the governor of the colony, though subordinate officials have the right to issue police regulations. This ordinance power has been utilized by the governors in matters affecting the public peace, health, and the economic development of the colonies. The use and acquisition of public or unoccupied lands, mines, forests, etc., and the carrying on of certain occupations, trades, and industries are subject to particular regulations. "Of particular interest have been the ordinances affecting the native population. In some cases, where agreements were made with native chiefs, the jurisdiction over the natives was reserved to such leaders. Even where this is not the case the policy of the Government has been to respect the customs of the natives and to subject them very gradually to the operation of the laws regulating the legal relations of the white population. Native chiefs are utilized in the administration of affairs affecting the natives. Moreover, the Government has recognized the obligation of protecting the natives in their dealings with the more intelligent and the less scrupulous white persons. Considerations of public safety as well as the interests of the natives have led to the prohibition or regulation of the sale of intoxicating liquors or of firearms to the natives. Particular rules are provided for the determination of contracts of sale, debt, pledge, etc., when a native is the party bound by the contract. Contracts for the employment of natives and for their transportation out of the colony are subject to governmental approval, and the latter are generally forbidden. Slave trading is prohibited. Slavery and polygamy are tolerated where the Government has undertaken to respect the customs of the natives, but the tendency is to eliminate both of these institutions. * * * METHODS OF RAISING REVENUE. "As previously indicated, the determination of the revenue so far as it arises from colonial sources, excluding loans, is within the control of the Emperor. It is, of course, possible for the imperal legislature to establish in the colonial budget a different income from that estimated, but this would take the form of the determination of a lump sum rather than the establishment or modification of a particular source of income. So long as the executive has the general power of colonial taxation, it is improbable that the legislature will undertake to determine the character or amount of the income. "The inhabitants of the colony have no voice in the determination of the source or amount of the revenue. determines such matters, subject to the power of the home authorities to overrule or modify his acts. The governor "No disposition is manifested to accord the citizens of the mother country any privileges in connection with the revenue system. So far as the Kongo act applies, such privileges would be subject to limitation. In certain colonies the citizens of foreign states have by treaty the right to the enjoyment of the same privileges as are accorded to German citizens. Certain colonial companies were granted extensive economic privileges as a return for the assumption of the costs and burdens of administration as well as the exploration and development of the colony. In so far as these privileges still exist they are limited to the right to take possession of unoccupied land, to mining and fishing privileges, etc. * * * "The colonial revenue may be divided into two classes, according to the sources from which it is derived: (1) Revenue derived from colonial sources; (2) subventions from the mother country. "1. Revenue derived from colonial sources.-Colonial sources of revenue may be classified: (a) Taxation; (b) fees; (c) public property. “(a) Taxation. (1) Direct taxes: Direct taxes have not constituted an important source of income; but there is a tendency to extend this species of taxation. The business or occupation tax was introduced at an early date in some of the colonies and has been gradually extended with the progress of economic development until it exists in nearly all of them. * * * "The house tax has also been recently introduced in German East Africa. For the purposes of the tax, houses are divided into two general classes: I. Houses built according to European, Hindu, or Arabian models; II. Houses and huts built according to native customs. "Each of these classes is subdivided into (a) Urban houses and (b) Houses in the country." The annual tax rate is as follows: Class I (a) 5 per cent of the rental value, not to exceed 100 R.; Class I (b) 3 grades, 10 R., 20 R., 30 R.; Class II (a) 2 grades, 6 R., 12 R., Class II, (b) 3 R. "An interesting feature is that in Class II payment of the taxes may be made 'in natura.' As such are recognized the fruit of certain nut-bearing trees and labor. In the interior grain furnished the overland caravans may also be rendered in payment of the "(2) Indirect taxes: Customs form the chief source of revenue from taxation. In German East Africa, Southwest Africa, and New Guinea both export and import duties exist, while in Cameroon and Togo only the latter are imposed. The rates are in general determined by revenue considerations alone. The ad valorem duties range from 1 to 20 per cent. Specific duties are used to some extent in all of the colonies and are the rule in New Guinea, where the duties are limited, applying only to imports of liquors and exports of copra.” 66 * SPANISH COLONIAL FISCAL SYSTEM. The statement which follows is from a paper on the Spanish Colonial Policy, prepared by Prof. Frank W. Blackmar, and published as a part of a series issued by the American Economic Association in August, 1900, under the title of "Essays in Colonial Finance:" * It is easy to infer what the colonial financial system of Spain must have been under the conditions of government like those that have been pictured. That the colonies existed for exploitation by the home Government may not have been fully acknowledged, but was practically carried out by the methods in vogue. COLONIES MANAGED AS PART OF THE REALM. "The colonies were managed as a part of the realm, and the national Government was responsible for their expenditures even as a father is responsible for his minor children. It was but natural that all incomes arising out of the colonies, or in any way accruing on account of them, should flow directly into the Spanish treasury. The small show of local government demanded little expense, and few taxes were collected and expended on local authority. The tax on the imported goods went on increasing from year to year, in accordance with the needs of the home Government. This tax on exports and imports fell heavily, both on the proprietors and the Indians. In the seventeenth century Spain demanded duties on playing cards, alum, copper, hides, quicksilver, gunpowder, ice, and salt. In addition to this were the duties on silver and gold and pulque-a drink used by the natives. The Bull for the crusade was collected every two years of every inhabitant. The acabala, or the tax on the sale of effects, was 5 per cent, and later increased to 14. The duty on the exportation and importation of merchandise (almajanfazgo) averaged about 15 per cent. The tax for the convoy of ships averaged about 2 per cent of the value of the freight payable by the importer. THE KING AND THE CHURCH. But taxation did not stop here, for the tax on the right to coin money flowed into the King's coffers along with one-fifth of the income of mines, which was later reduced to one-tenth. Also with these went one-half of the ecclesiastical annates and the King's ninth collected from the bishoprics. Nor did the Indians escape on account of their social differences, for each one paid 32 silver reals No. 4 23 each year besides 4 for the King's service. But this did not include the entire category, for the church came in for the local taxes. The ⚫above mentioned were for the King and his Government, but the clergy took what was left in parish rates, tithes, and other forms of taxes, by means of which the churches amassed enormous wealth in Spanish America. So great was this later drain that it alone took enough of the wealth from the country for nonproductive purposes to prohibit any normal business arising from the rest of the free capital of the country. In brief, the financial policy of Spain in the sixteenth century was for the Government to tax everything to its fullest extent, and the revenue thus raised was to be exploited by its officers from the King down to the alcalde of the town. Whatever of income left was then taken by the church. Thus the colonists paid practically all they had, and the national Government continued to lose its territory, go in debt, and multiply the number of officials and grandees with interminable titles. MANY CHANGES IN METHODS. "The Spanish Government made various changes in constitution and laws from time to time, and yet the relation of the mother country to the colonists changed little as respects liberality of trade, commerce, taxation, and officialism. Whatever of improvement took place in the fiscal system of the home Government was eventually tried in the colonies, as they were considered provinces of the Kingdom, or, in fact, parts of the Empire of Spain. It was not until the beginning of the present century, under the influence of the constitution, that the old laws which originated with the Romans and built up through Teutonic and Arabic influences began to decline, and a new scientific classification of the laws began to appear. Nearly a century has been devoted to the organization of the laws and the establishment of a system of a constitutional government in Spain, many of these attempts only increasing the confusion, owing chiefly to two facts-one, that in legislation the reorganizers were not clear and positive in repealing the old laws, and, second, that the conservatism of the Spanish people made them slow to adopt new methods of procedure. Without referring specifically to the development of the Spanish codes, it may be said that after the adoption of the constitution of 1811 frequent revision of codes have taken place until the final revision in 1888. The present civil code was extended to the Philippines, Cuba, and Porto Rico in 1889. The present constitution of Spain was adopted in 1876 and extended to the colonial provinces in 1881. In this organic law provision is madefor the government of the colonial provinces by stating that they 'shall be governed by special laws, but the government is authorized to apply to them, with the modifications it may deem advisable, and informing the Cortes thereof, the laws enacted, or which may hereafter be enacted, for the peninsula.' In fact, the Spanish civil, criminal, and commercial codes are the codes in use in the colonial provinces without practical change. Various differences exist in regard to the application of common and statute laws, but these differences are greater in some of the provinces of the peningula than in the insular provinces. The constitution provided for the representation of Cuba and Porto Rico in the Cortes 'in the manner determined by special law, which may be different for each of the two provinces.' This representation was resumed in 1878 after an interval. The central Government also determined 'when and in what manner the representatives to the Cortes from the island of Cuba should be elected.' "The constitution provides further for 'provincial deputations and municipal councils.' The law of Spain determines the manner of election of these, but both municipal councils and provincial deputations of each province or town 'shall be governed by their respective laws.' INSULAR GOVERNMENT OVERSHADOWED BY THAT OF SPAIN. "This appears like a fair promise of local self-government; but, in fact, the government of the peninsula so overshadowed the insular government that in reality it was the government of the provinces. * "No greater subterfuge was ever attempted in politics than the decree of autonomy respecting Cuba by the home Government. Subsequent events have rendered it unncessary to place any importance on the document except to show that the government of Cuba was practically an extension of the Government of Spain. While, indeed, there is a distinct colonial budget, under the supervision of the minister of the colonies, the procedure in the colonies is always after the plan of the peninsular government and in reference to its needs. SPANISH FINANCIAL SYSTEM EXPLAINED. "It is, therefore, best to refer briefly to the Spanish financial system as a preparation to a clear understanding of the fiscal system of the colonial provinces. The constitution of Spain provides (Title XI, article 85) that 'every year the Government shall submit to the Cortes a general budget of the expenses of the State for the following year, and the plan of ways and means to cover the same, as well as the accounts of the accounting and application of the public funds, for their examination and approval.' The law provides that this budget shall be made up not by the ministry as a body, but by each minister making an estimate of the annual expenses of his department, which goes finally before the council of ministers for discussion. It is also necessary to propose plans for raising the revenue to meet the expenses before the budget is completed and referred to the Cortes. "The budget of expenditures is divided into two parts: First, the general obligations of State, and second, the obligations of the departments of ministers. The first part is again subdivided into expenditures of (1) the royal household, (2) legislative bodies, (3) public debt, (4) charges of justice and indemnities, and (5) annuities and pensions. The second part is divided into (1) presidency of the council of ministers, (2) foreign affairs, (3) war, (4) marine, (5) justice, (6) interior, (7) public works, (8) finance, (9) expense of collecting taxes, and (10) the colony of Fernando Po. The budget of receipts represents six chief resources of income, as follows: (1) Taxes, (2) imposts, (3) customs, (4) Government monopolies, (5) properties and rights belonging to the State, and (6) the public treasury. Each item of the budget is discussed in both houses of the Cortes before an agreement is reached. "In order to provide revenue to meet the necessary expenditure an elaborate system of taxation prevails, as outlined in the six main heads above. Taxes are laid upon real estate and agriculture, industry and commerce, and the transmission of property, upon consumption, salaries of Government officials, railway tickets and transportation, and certificates of fidelity, tax upon imports, exports, loading and unloading ships, travelers, quarantine dues, and colonial produce; on commercial paper and stamped goods, tobacco, salt, lotteries, etc. Besides this the revenues are increased by income from the State tobacco monopoly, the rental of quicksilver mines and other State property, the payment for exemption from military services, and from the mint and post-office. These are the principal |