The Chargé in Colombia (Dawson) to the Acting Secretary of State
[Received November 24—4 a.m.]
95. Your November 20, 7 p.m. Paragraph 3, article 97, Law 4 of 191319 forbids departmental assemblies to tax articles which are taxed by national government unless given express authorization to do so by law. Council of State held in 1916 that prohibition extended to taxation of articles on which import duties are collected. So far as it has been possible to ascertain there are no laws in effect granting necessary authorization and consequently no departmental taxes on imported merchandise.
Paragraph No. 9, article 171, Law 4 of 191320 prohibits municipal councils from taxing things already taxed by the nation or department unless conceded the right to do so in a particular case. Article 4, Law 8 of 1888 authorized departmental assemblies to permit municipalities to establish consumption tax on foreign merchandise up to limit of 12 pesos per metric ton. Article 23, Law 99 of 192221 directly [Page 244] authorized municipal councils to place consumption tax not exceeding 20 pesos per metric ton on foreign merchandise to meet municipal public health expenses.
Medellín divides imported merchandise into 4 classes with tax rates: free, 5 pesos per ton, 10 pesos per ton and 20 pesos per ton (for complete schedule see report dated October 26th, 1931 from Vice Consulate at Medellín entitled New Municipal Import Tax23). Bogotá levies general tax of 8 pesos per ton (see Legation’s despatch No. 3092 of September 12th, 193123). It is understood that Call has general tax of 10 pesos per ton but it has not been possible as yet to consider this or secure copy of municipal ordinance. Data as to other municipalities not available but it is believed none have rates as high as those mentioned. Medellín rates are apparently highest for some articles and Call or Bogotá rates for others.
All of the above is purely advisory being based on Legation’s research and consultation with best possible authorities. Data secured from Colombian Government agencies fragmentary and inaccurate.
I presume that Department is aware that rates of national railways from coast to intermediate points are in some cases considerably higher than rates for similar articles from interior to intermediate points. Extension of this policy could work to offset in large part duty concessions in proposed agreement. The Department may desire to consider this matter before approving final draft of agreement.