The Chargé in Great Britain (Atherton) to the Secretary of State

No. 748

Sir: I have the honor to refer to the Department’s instructions No. 147, dated July 28, 1932, and No. 173, dated August 23, 1932,23 directing me to express to the Foreign Office the belief that, as no request has been made of British consular officers in the United States to file statements with the Commissioner of Internal Revenue with regard to the emoluments of persons employed in their offices, American Consular officers in Great Britain should not be obliged to make returns to His Majesty’s Inspectors of Taxes with regard to the emoluments of British subjects employed in American Consulates in Great Britain.

The substance of these instructions was conveyed to the Foreign Office by an official note as well as orally in the course of a conversation which a member of the Embassy staff had with the responsible officer in the Foreign Office, on September 12, 1932.

I am now informed unofficially by the Foreign Office that the Board of Inland Revenue takes the view that even if the Consul is not an employer within the meaning of the Income Tax Act, he would in any case be legally bound to supply the information desired as a “person who, in whatever capacity, is in receipt of any money or value, or of profits or gains arising from any of the sources mentioned in this Act, of or belonging to any other person who is chargeable in respect therefor”. The Foreign Office has, however, expressed willingness to request the American Government to enter into an arrangement by which American Consular officers would be instructed to communicate direct with the British revenue authorities.

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I enclose a copy of a draft note25 which the Foreign Office is prepared to send the Embassy. The note would point out that the transmission through diplomatic channels of the request for information with regard to the emoluments of British subjects employed in American Consulates would involve additional correspondence; and it would request the American Government to instruct, presumably as an act of comity, its Consular officers to communicate the information desired direct to the revenue authorities. I also enclose a draft of the reply25 which it is proposed the Embassy would make.

I should appreciate the Department’s instructions with regard to the appropriateness of both the text and the substance of these two draft communications.

The Department will recall in this connection that, as the Embassy has already reported, a complete list of the British subjects employed in the Embassy, together with their emoluments, is forwarded annually in accordance with the request of the Foreign Office.

Respectfully yours,

Ray Atherton
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