811.512358 Shipping/27
The Swedish Legation to the Department of State
Memorandum
This Legation has been informed that the authorities in the Philippine Islands have taken steps to tax ships belonging to A/B Svenska Ostindiska Kompaniet in Gothenburg and stopping at Philippine ports.
Section 2, point 5, of Section 213, b.8, of the U. S. Revenue Acts of 1921 and subsequent years, which exempts from taxation, under the principle of reciprocity, the income of a non-resident alien or foreign corporation which consists exclusively of earnings derived from the operation of a ship, does not extend to the Philippine Islands, and while it would thus seem that there is no formal hindrance against the Philippine authorities’ subjecting Swedish shipping to double taxation in the Philippine Islands, nevertheless the Swedish Government would deem it proper that the same principles which apply between the United States and Sweden regarding the taxation of shipping be extended also to shipping in the Philippine Islands, especially as such privilege has, according to information received by the Swedish Government, been granted to British shipping.