124.931/10–2347: Telegram

The Secretary of State to the Ambassador in China ( Stuart )

1362. Reurtels 2127, Oct. 2312 and 1655, Aug. 5 and earlier correspondence related matters. Dept takes general position one Govt [Page 1361] should not tax another Govt as tax constitutes encumbrance on operations and is attempt to impose obligation [to] contribute [to] public expenses and support of another Govt. While Art 4 of Treaty of 1943 provides that rights or titles to real property shall be subject to laws and regulations Rep of China concerning taxation, national defense, etc. it does not negate the usual rules international law and comity based on reciprocity and certainly does not require collection or payment taxes on real property owned by US and not used for nongovernmental purposes but rather leaves matter open for further arrangements between two Govts. US law and practice exempts within Dist of Columbia all properties owned by foreign Govts and used for legation purposes from all taxes and assessment except charges for services such as water rates. Further Dept will on reciprocal basis upon request from the Chinese Govt in each instance use its good offices to secure exemptions from state and municipal taxes on any property purchased for consular purposes by Chinese Govt.13

Marshall
  1. Not printed; it requested a reply to telegram No. 1655, supra.
  2. On November 17 the American Embassy sent a note to the Chinese Ministry for Foreign Affairs along lines of this telegram; copy of the note was transmitted to the Department in despatch No. 1105, November 17, not printed. No reply to this note found in Department files.