The Assistant Secretary of State (Acheson) to the Secretary of Commerce (Jones)
My Dear Mr. Secretary: There is enclosed a copy of a letter of July 18, 1941 to the President from the Acting Secretary97 regarding renewal of trade-agreement negotiations with Chile, involving the possibility of a reduction in the import tax on copper. In approving the proposed action, the President requested, pursuant to the Secretary’s suggestion, that you be consulted.
You are of course familiar with the history of the copper tax, which was never justifiable, and the manner in which it was enacted in 1932. As shown by the developments in 1939 referred to in the enclosed letter, it would normally be very difficult to reduce the copper tax. However, the present situation offers a more favorable opportunity to do so than is ever likely to exist again. In this connection, the Secretary has expressed himself in favor of revision of the tax.
The benefits to our general economy from a lower copper tariff are long-range rather than immediate, as we must look in the future to Latin America as an increasingly important source of copper at a reasonable price. An immediate effect, however, would be to save that portion of the funds of the Federal Loan Agency which now must be turned over to the Treasury in the form of the tax on the large volume of copper being imported by the Metals Reserve Company. A reduction in the tax in the near future would also be a factor in negotiating a trade agreement with Chile and thus in furthering the important object of hemisphere solidarity.
If, before expressing your views on this subject, you would like to discuss it further, I shall of course be glad to do so at your convenience.