No. 40, Separate
7th July 1864
1. I have the honor to transmit the Blue Book of Vancouver Island for the year 1863 being the first that has ever been compiled for this Colony.
2. I received this Book from the Colonial Secretary a few days before his departure from the Colony in the middle of May, and a pressure of business has prevented me from verifying itscontentsManuscript image contents until now.
3. It is not my intention to offer any lengthened comments upon tables and statistics which I do not think very reliable, and, this being the first Blue Book of Vancouver Island, there are no comparisons to make.
4. I must, however, offer some observations with a view to correct erroneous statements which have been placed before Her Majesty's Government in reference to the finance and taxation of this colony.
5. It has been stated authoritativelythatManuscript image that this Island is "overburdened" by taxation. I will therefore recapitulate the taxes levied.

Real Estate Tax which produced in 1863 £8854
Trade Licences 3687
Liquor Licences 4914
Harbour Dues 3563

The details and rates of these taxes will be found at pages 1 and 2 of the Blue Book.
6. The Ports of the Island are free, and there are no import or export duties of any kind.
7. The Real Estate Tax of one per cent per annum upon the assessed market value of allrealManuscript image real estate is that which has been dwelt upon as most oppressive and "burdensome".
8. I have no intention of discussing the policy of this Tax, but it can hardly be considered "burdensome" when compared with the tax for selling liquors (I think too low) which realized £4914, or more than half that paid by the whole real estate of the Colony.
9. When the amount raised by Trade Licenses, £3687 (includingvariousManuscript image various professions and callings) is compared with the value of Imports, I think it will be apparent that the commercial interest is not overburdened with taxes.
10. I believe the following may be taken as a nearly correct value of the imports:
But are they Imports for Consumption, or only goods brought into this free Port in [illegible]?

1861 1862 1863
$2,018,424 $2,550,242 $3,860,430
£ 416,299 £ 525,987 £ 796,213

11. There being no import duties the bulk of the population escape taxation in any form whatever, while the merchants and traders pay a tax of £3687 for TradesLicensesManuscript image Licenses being less than one half per cent upon their sales.
12. There has been a net increase of Revenue including loans in 1863 as compared with 1862, of £26,343, while there has been an increase of expenditure of £22,689.
13. The state of the Roads and land communication is very defective though an expenditure of £18,000 has been incurred in 1862 and 1863 and a large outlay voted for the current year. The law and practice in connection with this important subject stand greatly in need ofamendmentManuscript image amendment and will occupy my immediate attention.
14. The same may be said in reference to the survey, sale, leasing and general management of Public Lands.
15. A project for dredging and deepening the Harbour of Victoria has been entered upon, I think unadvisedly, and without sufficient data, which will I fear result in the useless expenditure of a large sum of money.
16. TheManuscript image
16. The population are orderly loyal, and prosperous. Pauperism is unknown.
17. The condition of the Indian population is very lamentable. Drunkenness and prostitution being the prevailing and prominent characteristics. I refrain from further notice of this matter which will be made the subject of a separate Despatch at an early period.
18. The capability of this Colony to support a population has been much discussed, and very opposite views expressed. There is in my opinion sufficientagriculturalManuscript image agricultural land of fine quality to support a million of people and the climate is unexceptionable and most salubrious.
19. Expensive and defective postal and other communication are the great bar to progress, and reflect but little credit upon two great nations, England and America. A "Times" newspaper costs fourpence postage, and that for a book is entirely prohibitory.
20. It is surprising how little is known of the resources and interior of this Island. LooseassertionManuscript image assertion and surmise have been accepted in lieu of accurate examination or survey. To remedy this great want I have recently despatched an exploring party under an intelligent leader, liberally supported by private subscription in aid of the Government expenditure. The first report from this party is highly encouraging.
21. I can see nothing to retard the steady progress and prosperity of this Island if the colonists are prudent and truetoManuscript image to themselves.
I have the honor to be
Your very obedient Servant
A.E. Kennedy
Minutes by CO staff
Manuscript image
Mr Elliot
Print this desph, as usual, with other Blue Book reports. Blue Book to Library.
This despatch very much confirms the impression I have entertained & which I have frequently stated that the taxation of V.C.I. might be easily increased without undue pressure. There are, however, local & municipal taxes, raised for special [purposes],Manuscript image which the community has to bear.
If there is sufficient good land to sustain a population of a million of people—as stated by the Govr at Par: 18—and as that Land belongs to the Crown, the Colony will make a very good bargain if it gives the Crown a Civil List of £5800 per ann: which we have asked for, in exchange for the proceeds of the Land sales.
ABd 24 Augt 64
Mr Fortescue
A Blue Book report is generally assumed to be merely for information. The passage in this, however, about heavy postage makes me think whether anything could be done. I fear not, for that the cause must be our being in the hands of AmericansManuscript image both for the transit across the Isthmus, and for the Steam navigation on the Pacific side.
Print as usual?
TFE 8 Sep.
CF 12
EC 14
N.B. I have seen Mr Frederic Hill of the Post office today, and he tells me that the Vancouver Postage via New York & California is only 1s/ from England, which does not seem much to practically the most inaccessible Colony or possess[ion]: the postage on Newspapers by that route from England is 2d/. This is all that England charges. The rest if more is paid, must be a Colonial charge, by that route. But via Panama (which is not the quickest) the letters cost 2s/4d and the Papers 4d/.
TFE [date cut off microfilm]
Documents enclosed with the main document (not transcribed)
Not on microfilm.