811.512394 Shipping/56
The Secretary of State to the Ambassador in Japan ( Grew )
Sir: With reference to your telegram No. 31, February 19, 11 a.m.,10 there is enclosed a copy of a memorandum, in regard to the question of war profits taxes asserted by the Treasury Department against certain Japanese steamship companies, which was handed on April 27, 1936, to the Japanese Ambassador by the Under Secretary of State.11
It will be noted from the enclosure that the Treasury Department has made an offer to the Japanese steamship companies which, if accepted, would effect a reduction of the amount of the total deficiency payments from the Japanese steamship companies concerned from approximately $2,300,000 to $650,000. It will further be noted from the enclosure that the Japanese Ambassador was informed that, in the event that the proposal of settlement offered by the Treasury Department to the Japanese steamship companies is rejected and the cases are litigated, any decision which may be rendered by the Board of Tax Appeals, before which the cases are now pending, or by any court before which the cases may subsequently be brought would probably be based primarily on the legal questions involved.
In the event that further reference to these cases is made to you by officials of the Japanese Government, it is requested that any statement which you may consider desirable to make conform to the sense of the last three paragraphs, or any portion thereof, of the enclosure.
Very truly yours,