881.512/159
The Chief of the Division of Near Eastern Affairs (Murray) to the Chargé at Tangier (Childs)
Dear Rives: I have received your despatch no. 443, November 11, 1941 in further explanation of your views on the imposition of the Spanish Zone fiscal regime in Tangier. I entirely understand your views regarding the possible advisability of payment by American ressortissants of such taxes imposed under the new regime as may be justified as compensation for services rendered or as being based on the Act of Algeciras, and you are of course correct in pointing out that the Department’s policy in Manchukuo was to advise payment of taxes imposed for services.
In drafting the instruction of September 2746 on this subject, our thought was, as expressed by Mr. Ward, that there is a certain undesirability in advising Americans to pay taxes to a regime which has usurped authority in Tangier by force of arms, even though we might not be disposed to oppose the payment of some of those taxes. That is, we did not wish to appear to give our approval to a measure whose application to our ressortissants is not legally justifiable. Possibly we should have indicated, however, that we did not intend to lay down a hard-and-fast rule. From a practical point of view, I think that you should feel free to use your own judgment in particular instances. I can imagine that a case might arise in which an arbitrary refusal to pay a tax normally and necessarily imposed in all countries for services rendered would stir up an entirely futile and harmful controversy.
Consequently, I should like to clarify the instruction of September 27 by saying that we are willing to leave you free to modify its terms, within the limits suggested in your despatch of August 12,47 whenever in your judgment one of our ressortissants is likely to adopt an attitude not morally justifiable and possibly harmful to the relations of the Legation and the American colony with the Spanish authorities. In other words, while making it clear that this Government does not give its approval to the imposition of taxation on American ressortissants by an unrecognized authority, you may, when you consider it necessary, point out to inquirers that taxes are essential to the functioning of any administration and that, as a practical matter, it might be wiser to pay them. I have in mind, of course, the particular taxes which you mention in paragraphs “a”) and “b”), pages 13 and 14 of your despatch of August 12.
Sincerely yours,