The Consul General at Shanghai ( Davis ) to the Ambassador in China ( Stuart )7
Sir: I have the honor to refer to my despatch No. 170 of February 21, 1947, and to the Embassy’s instruction of March 10, 1947, concerning payment of the Land Value Tax on U. S. Consular Lot No. 2222, owned by the United States Government.
In compliance with the Embassy’s instruction this office, on March 17, 1947, wrote the Commissioner of the Bureau of Land Administration8 formally objecting to payment of the tax and requesting that an exemption be granted. A copy of this letter is enclosed for the Embassy’s information.9[Page 1360]
A reply has now been received under date of June 24, 1947, a copy of which is enclosed, quoting an instruction from the Executive Yuan indicating that this exemption has been refused on the grounds that (1), Article IV of the Sino-American Treaty of 194310 subjects the rights and titles to real property of the United States Government in Chinese territory to the laws and regulations of China concerning taxation; and (2), that there is no arrangement between the two governments for reciprocal exemption of government owned real property from all taxes.
The Consulate General is informing the Commissioner of Land Administration that it cannot accede to his request for payment within seven days and that the matter has again been referred to the Embassy. A copy of this communication is enclosed.