It is, however, regretted that it will not be possible to render you the
assistance you ask, and, in this connection, I am enclosing, as of [Page 235] possible interest to you, a
copy of the pertinent portion of the opinion of the Solicitor of the
Department of State in this regard.
I have to inform you that I am in entire agreement with the opinion
expressed by the Solicitor.
[Enclosure]
Excerpt From Opinion Expressed by the Solicitor
of the Department of State
Questions somewhat similar to that raised in the note of February 7,
1929, from the Legation of the Irish Free State have been considered
several times by this Department. As long ago as May 22, 1912, and
it is clear that there are other earlier cases, this office prepared
a memorandum reviewing the authorities and reaching the conclusion
that:
“No authorities have gone so far as to lay down the rule
that, irrespective of ownership, property used for
diplomatic purposes should be exempt from taxation. Such
exemption would clearly seem unwarranted even under a most
liberal interpretation of the general principle that a
diplomatic officer is exempt from local jurisdiction and
enjoys certain immunities in order that he may not be
interfered with in the discharge of his official duties.
Whatever might be the proceedings employed in collecting the
tax under such circumstances, no process would be served on
the diplomatic officer occupying the rented property, and in
no way would there be any attempt to subject him to local
jurisdiction. The possibility that he would be disturbed in
the possession of the premises under his lease as a result
of the title passing from the owner in case of such owner’s
failure to pay the taxes would be extremely remote, and such
a situation would likely have no bearing on the general
principle in question.”
The following statement from Volume IV, Moore’s International Law Digest, 670–671, is of interest in this
connection:
“In reply to your letter of the 23rd ultimo, I have to say
that the rule observed by this Government with respect to
the taxation of property owned by a foreign government and
occupied as its legation, is to accord reciprocity in regard
to general taxation but not to specially exempt it from
local assessments, such as water rent and the like, unless
it were definitely understood that these taxes would also be
exempted by the foreign government upon a piece of property
belonging to the United States and used for a like purpose
by our minister. …
“When a foreign legation occupies rented property in this
country, the owner of the premises is not exempted from the
payment of all lawful taxes.” (Mr. Bayard, Secretary of
State, to Mr. Woolsey, April 15, 1886.)
[Page 236]
In a circular instruction to diplomatic and consular officers the
Department stated in part as follows:
“The taxes on the sales of automobiles and jewelry provided
for in Sections 600 and 604 of the Revenue Act of 19241
are taxes imposed upon the manufacturers of automobiles and
upon the vendors of jewelry. In the collection of such taxes
the Government looks to the manufacturer and to the vendor
for the payment of the tax and not to the purchasers of the
articles. For this reason and the further reason that the
price of the article sold is a matter of negotiation between
the vendor and the purchasers, the appropriate authorities
of this Government have taken the position that no exemption
from the payment of those taxes can be granted to the
manufacturer or vendor by reason of the fact that the sale
is made to a diplomatic representative of a foreign
government.”
The question submitted by the Legation of the Irish
Free State would seem to be similar to the case of the sale of
automobiles. The matter of the payment of the tax by the Legation is
entirely a matter between the owner of the property and the
Legation. If the payment of the tax is assumed under the lease it
would seem that it would not be possible to give favorable
consideration to the request of the Legation. As pointed out above,
the owner of the premises would not be exempt from the payment of
the taxes and if he finds it necessary to insert a provision in the
lease whereby the Legation is required to assume the payment of the
tax and the Legation signs such lease, that is a matter beyond the
jurisdiction of this government to control.
