883.512/19

The Chargé in Egypt (Johnson) to the Secretary of State

No. 499

Sir: I have the honor to acknowledge the receipt of the Department’s instruction- No. 156, May 5, 1924, with reference to the [Page 713] collection from foreigners enjoying capitulatory rights of the Gaffir Tax under the decree of Feb. 16, 1924, and to the request on the part of the Egyptian Government that the American Government consent to the collection of this tax from American nationals in Egypt.

Just prior to the receipt of the Department’s instruction, under reply, a further inquiry was received from the Ministry for Foreign Affairs with regard to the views of the Government of the United States. A copy and translation of the note of inquiry referred to is enclosed.6

The Department states that if the other Powers enjoying capitulatory rights in Egypt consent to the collection of this tax from their nationals in the cities of Cairo, Alexandria, Port Said, Ismalia and Suez, the Legation may inform the Egyptian Government that this Government has no objection to the collection of the Gaffir Tax from its nationals resident in the cities above mentioned. I accordingly made inquiry and ascertained that, pending the establishment of an equable system of collecting the Gaffir Tax outside of the cities mentioned, the British Government, for one, have withheld their consent to the collection of the tax, even in the cities. As long as one important Power has thus made its consent conditional upon the devising of the system referred to, it was obvious under the instruction that the Department would not desire the Legation to give as yet the formal consent of the United States to the collection of this tax, even in the cities mentioned. I am very reliably informed that all the other Powers have adopted the same attitude. The British High Commissioner very kindly furnished me with a copy of the formal reply of his Government, a copy and translation of which I transmit herewith.6 I also enclose a copy of the Legation’s Note Verbale of today adopting the same attitude.

I have [etc.]

Stewart Johnson
[Enclosure]

The American Legation to the Egyptian Ministry for Foreign Affairs

No. 168

The Legation of the United States of America presents its compliments to the Royal Egyptian Ministry for Foreign Affairs, and has the honor to acknowledge receipt of the latter’s Note Verbale No. 48.2/1 (2796), dated May 26, 1924,6 referring to its circular letter of March 20, 1924, concerning the application of the decree of [Page 714] Feb. 16th last, relative to the recovery of the Gaffir Tax from foreigners resident in Egypt, and requesting the reply of the Government of the United States on this subject.

The Legation has now received the views of the Government of the United States which are to the effect that in principle it has no objection to the collection of the Gaffir Tax from its nationals resident in the cities of Cairo, Alexandria, Port Said, Ismalia and Suez. However, until some system of collecting the Gaffir Tax outside of the cities above mentioned is devised so as thoroughly to safeguard the tax payers from unreasonable assessment, the American Government cannot admit the application of the Gaffir Tax to American citizens resident outside of the cities.

The Department of State would be pleased to have the Legation keep it informed of the progress made towards devising a method of collection of the Gaffir Tax outside of the cities referred to above, in order to avoid present difficulties, before pronouncing itself definitely upon the question of the application to its nationals, whether resident within or outside of the cities mentioned, of the provisions of the decree of February 16th last. The Legation will appreciate information from time to time, with regard to progress made in the direction indicated, in order that it may transmit it to the Department of State.

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