467.11 Vacuum Oil Co./120
The Vice President of the Standard Oil Company of New York (L. I. Thomas) to the Secretary of State
[Received January 29.]
Sir: I have the honor to bring to the attention of the Department the following telegram which I have received from the General Manager of the Standard Oil Company of New York for the Levant, dated Constantinople, January 25th:
“Since April 15th, 1920, Consumption Tax has not been paid at Smyrna on the advice of our Smyrna Consul General. On January 15th, after thorough investigation, authorities demanded from us arrears amounting to Pounds Turkish 101,998 and they have prohibited further issues from our warehouse until settlement is arrived at. High Commissioner here has advised us not to pay and telegraphed yesterday all particulars to Washington, D. C. If possible please telegraph position taken by State Department and probable result of such action in promptly removing restrictions in our Smyrna business.”
As you are aware, the Greeks have been in occupation of Smyrna for the last 18 months and it would seem from the telegram above quoted that, acting under the instructions of our Consul General we have refused to pay a Consumption Tax of Three Piasters per kilo on refined oil since April 15, 1920. Such a tax was not contemplated under the Capitulations, the abolishment of which has never been recognized by the Allied or Associated Governments. You will note that the authorities are now demanding that we pay arrears amounting to Pounds Turkish 101,998, which at the prewar rate of exchange would be the equivalent of nearly $450,000 United States currency. At the present rate of exchange same would amount to, roughly speaking, $75,000.
Apparently the American High Commissioner at Constantinople has supported the attitude which has been taken by the Consul General and has telegraphed to the Department full particulars. We, of course, will be guided by the wishes of the representatives of our Government, but as we are restrained from carrying on our business until a settlement is effected it is vitally important that we be coordinated with the Department of State to the extent of knowing their wishes with the least possible delay.
Asking, therefore, that you will kindly advise us what steps have been taken in dealing with the telegram from the American High Commissioner at Constantinople,
I have [etc.]