893.512/1179
The American Minister in China (Johnson) to the Chinese Acting Minister for Foreign Affairs (Wellington Koo)71
Excellency: I have the honor to refer to the Legation’s formal note of September 25, 1931, to which no reply has been received, concerning the imposition of certain taxes in Hunan, namely, wharfage dues, a dike surtax, and a production tax.
The Legation has now received a further report from the American Consul General at Hankow, enclosing a copy of a proclamation issued by the Hunan Provincial Government establishing a combined “Production-Consumption Tax” to be levied on “all the principal special commodities imported from other provinces or exported out of this province and on products sold within the limits of this province.” A copy of the text of this proclamation together with the regulations promulgated to govern the collection of this tax are enclosed72 for the information of Your Excellency. A careful examination of these regulations indicates that this new “Production-Consumption Tax” is a definite tax on goods imported, exported, and sold in the province of Hunan and that other than for its new name it is indistinguishable from likin.
The Legation in its formal note of September 25, 1931, called the Ministry’s attention to the solemn undertakings of the National Government with respect to the abolition of likin. It is constrained once again to invite the serious attention of Your Excellency’s Ministry to the flagrant violation of these undertakings as represented by the imposition of a tax of this nature. It is, therefore, requested that instructions be issued to the appropriate authorities to effect the immediate abolition of this tax in so far as American trade in the province of Hunan is concerned. The courtesy of an early reply from Your Excellency will be greatly appreciated.
I avail myself [etc.]
Counselor of Legation