The land-tax is based on the old land-registers handed over by the Chinese magistrates of Wên-têng and Jung-ch'êng, and as they had been badly kept up, or rather not kept up at all, for some scores of years previously, the present relations between the land under cultivation and the land subject to taxation are extremely indefinite. It is but very rarely that a man can point to his land-tax receipts as proof that he owns or has long cultivated any disputed area. Only by making a cadastral survey of the whole Territory would it be possible to place the land-tax system on a proper basis. At present the tax is in practice (with certain exceptions) levied on each village as a whole rather than on individual families. For many years past every village has paid through its headman or committee of headmen a certain sum of money which by courtesy is called land-tax. How that amount is assessed among the various families is a matter which the people decide for themselves, on the general understanding that no one should be called upon to pay more than his ancestors paid before him unless the family property has been considerably increased.
The Chinese Government did not and the British Government does not make any close enquiries as to whether each cultivator pays his proper proportion or whether a certain man is paying too much or is paying nothing at all. It is undoubtedly true that a great deal of new land has been brought under cultivation since the Chinese land-tax registers were last revised, and that the cultivators are guilty of technical offences in not reporting such land to Government and getting it duly measured and valued for the assessment of land-tax: but these are offences which have been condoned by the Chinese authorities in this part of China for many years past, and it would be unjust or at least inexpedient for the British Government to show greater severity in such matters than is shown on the Chinese side of the frontier. The British Government has, indeed, by a stroke of the pen doubled the land-tax, that is, it takes twice as much from each village as it did six years ago, so it may at least congratulate itself on deriving a larger revenue from this source than used to come to the net of Chinese officialdom. The total amount of the doubled tax only amounts to about $24,000 (Mex.) a year, which is equivalent to not much more than £2,000 sterling. The whole of this is brought to the coffers of the Government without the aid of a single tax-collector and without the expenditure of a dollar. In the autumn of each year proclamations are issued stating the current rate of exchange as between the local currency and the Mexican dollar and announcing that the land-tax will be received, calculated according to that rate, upon certain specified days. The money is brought to the Government offices at Port Edward by the headmen, receipts are issued, and the matter is at an end until the following year. Litigation regarding land-tax payments is exceedingly rare and the whole system works without a hitch.