ADMINISTRATION AND FINANCE OF THE EAST INDIA COMPANY 19
monopoly policy was given up in favour of the transit duties recovered by way of “passes” at a specified rate to cover the transportation cost to Bombay. The transit duty was at first fixed at Rs. 175 per chest of 140 lbs. each. This process showed a diminution in the returns, consequently the rate was reduced to Rs. 125 per chest.
The conquest of Sindh closed the additional gate of smuggling the opium into the Portuguese territories : consequently it was hoped and rightly that a higher transit duty would give added return as the change in the direction of the trade was impossible. So in 1843 October, the rate was increased to Rs. 200 per chest, in 1845 to Rs. 300 per chest and in 1847 to Rs. 400 per chest.
III. The Salt Tax
Salt is obtained in India in different ways and is taxed in different ways in different parts of the country.
It is obtained either by boiling sea water as in Bengal, or by solar evaporation as in Bombay and Madras or from natural resources such as the salt mines in Punjab and the salt lakes in Rajputana.
In Bengal the Company had a salt monopoly. It was manufactured by the natives who contracted to deliver ail manufactured salt to the Government at a fixed low price. The Government then sold this quantity of salt at six different agencies, Hidgelee, Tumlook, Chittagong, Hiracan, Cuttack, Balasore and Khoredah, at a price which was composed of the actual cost plus the additional amount equivalent to the duty levied on imported salt. As a result of this “the average retail price to the consumer” amounted to about a penny per pound.
The private manufacture of salt was also allowed at Calcutta under a system of excise only equal in amount to the import duty.
But on the recommendation of the select committee of the House of Commons in 1836, there was introduced the system of fixed prices, and open warehouses, at which the sales, instead of being as before periodical “were constantly going on.”
In Madras, salt was manufactured on behalf of the Government and was sold for internal consumption. The duty on imported foreign salt was lowered from Rs. 3 per pound to equal the difference between the cost price and the sale price of the article.