811.512394 Shipping/66
The Japanese Embassy to the Department of State
Memorandum
The Japanese Embassy has transmitted to the Department for Foreign Affairs of the Japanese Government the memorandum of the State Department, dated April 27, 1936, which sets forth the views of the United States Government on the additional war profits taxes asserted by the Treasury Department against three Japanese shipping companies, namely, the Nippon Yusen Kaisha, the Osaka Shosen Kaisha, and the Toyo Kisen Kaisha, and is now authorized to state that the Japanese Government is gratified to note in the memorandum the responsive attitude expressed by the United States Government to the request that friendly consideration be given to the matter in view of the special circumstances in which a number of steamers were placed at the disposal of the United States Government by these shipping companies. The proposal of the Treasury Department made to the companies to effect a settlement of the pending cases on the payment of approximately $650,000 has, therefore, been carefully considered by the Japanese Government as indicative of this responsive attitude taken by the United States Government.
The Japanese Government, appreciative of the conciliatory spirit of the United States Government and desirous of expediting the settlement of this long standing issue, will refrain from submitting its views on various points, particularly on the question of amortization, set forth in the memorandum of the State Department, since any further discussion will inevitably delay such a settlement, and it has endeavored to induce the steamship companies to accept the proposal of the Treasury Department. Now the steamship companies are, it is learned, prepared to accept the proposal above referred to, on the understanding that the amount to be paid as the balance of the deficiencies assessed against the Nippon Yusen Kaisha and the Osaka Shosen Kaisha after deducting the excess assessment [Page 961] to be refunded to the Toyo Kisen Kaisha will not be more than $650,000, and further that the payment of interests that may have accrued from the said deficiencies or excess assessment will not be claimed in any form.
It is earnestly hoped that the United States Government, which undoubtedly shares the opinion of the Japanese Government that a satisfactory settlement of the issue should be reached at as early a date as possible, will agree to the terms of the settlement as indicated above.
If they be acceptable to the United States Government, the details of payment and other necessary procedures will be negotiated between the Japanese steamship companies and the Treasury Department.