File No. 893.512/36.
Chargé MacMurray to the Secretary of State.
Peking, July 20, 1914.
There have recently been brought to the attention of the Legation numerous instances of illegal levy of inland taxes in Chekiang, Kiangsu, Anhui, involving the following questions:
First. Levy of likin within open ports.
Second. Levy of likin by private organizations to which the collection has been farmed out.
Third. Specific discrimination against certain American products in the tariff of charges levied under the conditions above indicated; an American consignment is reported as seized at Nantao on the 16th instant for refusal to pay increased likin taxes under the circumstances.
Fourth. Levy of likin upon goods covered by transit passes. Fifth. Levy of consumption taxes on transit pass goods at destination.
Sixth. Imposition of a special consumption tax specifically upon foreign goods brought into the interior under transit passes, which [Page 125] tax is moreover calculated on the basis of the likin and consumption taxes payable on goods brought in without such protection.
Chekiang Lo Ti Chuan regulations, which came into effect last October and are now being enforced in Anhui and Kiangsu, involve discriminations indicated in the last above category against goods seeking to avail themselves of the protection provided by treaties. In spite of the repeated protests of British Legation, which have been otherwise completely ignored, the taxes have been twice increased and the Governor of Chekiang has been commended by presidential mandate for his successful administration of taxation. Concurrently with the British, the Legation on the 17th instant asked the Foreign Office for the cancellation of the Chekiang regulations.
In discussions involving the first, second and fifth categories above, the Foreign Office has manifested a disposition to yield nothing to the contentions of the treaty powers, as to the effect of the treaty stipulations in regard to the commutation of and exemption from inland taxation. It seems evident that the Central Government is countenancing, if not in fact abetting, subversion of even the most explicit rights in the matter of inland taxation granted by treaty, and may therefore be expected to follow a line of obduracy and evasion in dealing with both the long-standing questions in dispute and those which are now of first importance.
I beg to request, therefore, that the Legation be authorized in that event, and in its discretion, to advise the Minister for Foreign Affairs that, failing scrupulous observance by the Chinese Government of its treaty obligations, the American Government cannot feel itself justified in the interests of its citizens in assenting to forego any of its treaty rights in the closely connected matters of the proposed stamp tax (Department’s instruction Number 90 of May 4th); and that our Government might even find itself eventually forced to reconsider approval already given by it under the Department’s telegram December 17,46 to the Chinese proposal for revision of tariff.
- Not printed.↩