683.003/40: Telegram

The Secretary of State to the Minister in Egypt ( Jardine )

40. Your telegram 36, March 19, 5 p.m. and despatch 95, March 20.30 The Department is of the opinion that the tax under reference is not an excise tax but a double import tax retroactively applied and that the question of the validity of the application of the tax and of the measures adopted for its collection from capitulatory nationals was not within the competence of the General Assembly or the Legislative Assembly of the Mixed Courts but should have been submitted in the first instance directly to the Powers for their consideration.

However, in consonance with the view expressed in the last paragraph of the above-mentioned despatch,31 the Department wishes to avoid further discussion of the matter with the Egyptian Government. Moreover, in view of the reservations contained in its telegram of March 4, 1 p.m., and in view of the personal assurance given by the Egyptian Minister for Foreign Affairs to the British Residency to the effect that pending an agreement on the subject the Egyptian Government will not again adopt this method of procedure, the Department considers that there is no present need for such further discussion.

Please keep the Department informed of developments in this case, especially of any discussions which may eventually take place between the Residency and the Egyptian Government with regard to the principle at issue.

  1. Despatch not printed.
  2. i. e., “it would be difficult to enter into such discussions without involving the broad and thorny problem of the general question of capitulatory rights and obligations. …”