The Ambassador in Germany (Sackett) to the Secretary of State

No. 2112

Sir: I have the honor to enclose herewith a copy of a self-explanatory letter, dated December 29, 1932, from the Commercial Attaché of the Embassy,22 with reference to the refusal of the German Ministry of Finance to recognize subsidiaries of American firms, resident and incorporated in Germany, as corporations entitled to tax certificates on the ground that “the parent companies abroad are ultimately responsible for the taxes payable by their subsidiaries in Germany and, since the parent company is not obviously domiciled in Germany, neither the parent company nor the subsidiary is entitled to the tax certificates.”

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As the Department will recall (see despatch No. 1913 of September 12, 1932)23 these tax certificates may either be discounted by the recipients thereof as negotiable paper, or may be held for future tax payments at their face value, plus a premium of 4 per cent per annum, in the fiscal years 1934 to 1938 inclusive.

Inasmuch as the Embassy is of the opinion that this attitude of the Ministry of Finance is in violation of Article VIII of the Treaty of Friendship, Commerce and Consular Rights of 1925 [1923], between Germany and the United States,24 I have the honor to refer the matter to the Department for its information and instructions in the premises.

Respectfully yours,

Frederic M. Sackett
  1. Not printed.
  2. Not printed.
  3. Signed at Washington, December 8, 1923, Foreign Relations, 1923, vol. ii, p. 29.