893.5123 Manchuria/9: Telegram
The Counselor of Embassy in China (Lockhart) to the Secretary of State
[Received December 27—6:20 a.m.]
848. Embassy’s 816, December 13, 4 p.m. Mukden reports that the income tax is to be collected on practically all earned (non-profit) [Page 953] incomes of yuan 70 or more monthly at rates of 5% to 4%, to which is added a surtax of 50% of the basic rate, effective January 1 next. Employers are made responsible for the collection of the tax, fines provided for failure to submit returns or for the submission of false returns. Mukden states that a separate income tax law affecting liberal professions was promulgated December 6 for enforcement January 1 and that a translation is being prepared.
The above measures appear to be intimately connected with the general problem of extraterritorial rights in Manchuria, and Mukden requests instructions in regard to what action if any should be taken in anticipation of the contemplated assertion of jurisdiction over American nationals.
It is the Embassy’s belief that this law will have to be dealt with according to the principles laid down in the Department’s 405, December 23, 7 p.m., which was repeated to Mukden and Harbin on December 24, and it proposes so to instruct the Consulates in Manchuria if the Department agrees.81
Repeated to Tokyo.
- The Department gave approval in telegram No. 413, December 29, 4 p.m.↩