File No. 893.512/73
Minister Reinsch to
the Secretary of State
No. 1263
American Legation,
Peking,
November 13, 1916.
Sir: In continuation of the Legation’s
despatch No. 1215 of September 29 last on the subject of the so-called
99 Mercantile Tax levied in Kiangsi Province, I have the honor to
enclose herewith a further despatch from the Consulate General at Hankow
(No. 340)
[Page 237]
under date of the 3d
instant, reporting that the Kiukiang branch of the Standard Oil Company
has taken steps in pursuance of the Legation’s suggestion that it revert
to the method of shipping its imports into Kiangsi Province under the
protection of transit passes rather than under the pao-shang-piao system.
There is also enclosed for the information of the Department a copy of
the Legation’s reply (No.1964) of today’s date, which seemed to be
necessary in view of the company’s apparent misunderstanding of the
Legation’s position in this matter.
I have [etc.]
[Inclosure 1]
Consul General Cunningham to Minister Reinsch
No. 340
American Consulate General.,
Hankow,
November 3, 1916.
Sir: Referring to the Legation’s
instruction No. 1873 of September 27, 1916, regarding the 99
Mercantile Tax and suggesting the use of the transit passes by the
Standard Oil Company, I have the honor to state that the Standard
Oil Company’s branch at Kiukiang has advised this office that they
have now bonded their tanks as from November 1, 1916, and will
immediately commence shipping under transit passes to inland
points.
The Standard Oil Company in a letter of November 1, 1916, states that
“We shall be glad if you would kindly, at your earliest
convenience, advise the Legation of this our decision and
action, requesting the matter of the 99 Tax be again taken
up with the Chinese authorities, with a view to the
immediate abolishment of same.”
This, it is thought, is in line with the Legation’s instruction to
this office above referred to.
I have [etc.]
[Inclosure 2]
Minister Reinsch
to Consul General Cunningham
No. 1964
American Legation,
Peking,
November 13, 1916.
Sir: The Legation has received and taken
note of the despatch (No. 340) of the 3d instant in which you report
that the Standard Oil Company’s branch at Kiukiang has advised you
of its having bonded its tanks as from the 1st instant and that it
will immediately commence shipping under transit passes to inland
points, as suggested in the Legation’s instruction of September 27
last (No. 1873) in regard to the 99 Mercantile Tax.
With reference to the company’s request that the Legation again take
up with the Chinese authorities the matter of the 99 Tax, “with a
view to the immediate abolishment of same,” the Legation has to
observe that this seems to indicate a misapprehension that that tax
is in itself illegal. The Legation perceives no basis for such an
assumption, and it is not prepared to insist that the tax be
discontinued save in so far as concerns its misapplication to
shipments which have, by the taking out of transit passes, become
entitled to exemption from that and other inland charges.
It is desired that you bring this view to the attention of the agent
of the Standard Oil Company at Kiukiang and advise him that the
Legation looks to the company to furnish it the necessary concrete
and definite evidence upon which to base such action as it may find
appropriate, in the event that the provincial authorities levy or
seek to levy the 99 Mercantile Tax upon consignments covered by
transit passes.
I am [etc.]
