The Chargé in Latvia (Sussdorff) to the Secretary of State
[Received October 22.]
Sir: I have the honor to refer to the Department’s telegram No. 58, of September 25, 11 a.m., authorizing the Legation to address a Note to the Latvian Foreign Office concerning the desire of the United States Government to secure the exemption of American citizens from the residence tax imposed on foreigners in Latvia.
As a result of further informal conversations with the Latvian Foreign Office, the Legation has decided to withhold the despatch of the Note in the form suggested by the Department until it has submitted to the Department further particulars concerning the practice and views of the Latvian Government with respect to the residence tax on foreigners.
The first sentence of the draft suggested by the Department contains an inaccurate statement of fact, since, according to the Latvian Foreign Office, the Latvian Government does not follow the practice of granting nationals of foreign countries residing in Latvia exemption from the residence tax although it has made an agreement with Estonia whereby on the basis of reciprocity nationals of each country residing in the other are exempted from this tax. Latvia has so far made only one other agreement with respect to exempting citizens of foreign countries from the residence tax—namely, the agreement with Great Britain, to which the Legation referred in its telegram No. 75, of September 7, 3 p.m. The Latvian Foreign Office states that nationals of all foreign countries, except Estonia and Great Britain, residing in Latvia are paying the same residence tax as that now paid by American citizens.
The Latvian Government considers agreements such as the two referred to above as being of a purely administrative nature and maintains that it is not bound by any treaty provision and that it is not under any other obligation to make such an agreement with any country. The Legation is of the opinion that the Latvian Foreign Office will adhere firmly to this point of view, …
The Latvian Foreign Office states, however, that it is willing, by special agreement, to exempt citizens of certain countries, including the United States, from the Latvian residence tax, providing the Governments of those countries assure the Latvian Government by Note that Latvian citizens residing in their territory are exempt from such taxes.
In order to avoid a protracted correspondence which may delay the relieving of American citizens from the burden of the Latvian residence tax, it is suggested that the Legation be authorized to [Page 238]submit a Note to the Latvian Foreign Office along lines similar to the British Note, a copy of which is transmitted herewith.62 I am enclosing a draft of a Note62 which I believe will result in bringing about the desired action on the part of the Latvian Government and which will not, in my opinion, admit in any way that the situation is not fully covered by treaty. It would be appreciated if the Department would telegraph me whether it approves of my delivering this Note to the Latvian Government and at the same time making an oral statement that the failure of the United States Government to refer to the Treaty is not to be construed as an admission that the situation is not covered therein.
I have [etc.]