Prussian minister of finance. The Prussian minister of finance subsequently directed that the assessment of the state income tax should be discontinued and the amount already paid refunded. A similar conclusion was reached in regard to the communal tax. Mr. Pendleton, min. to Germany, to Mr. Bayard, Sec. of State, March 20, "Your wife, being resident in Germany, is subject from the nature of The minister of the United States at Vienna having reported the case of an American citizen who alleged that he was not properly liable to an income tax in Austria, the Department of State replied that the matter was one which should be tested in the Austrian courts, and that it did not in its present aspect present a subject for diplomatic intervention. Mr. Hay, Sec. of State, to Mr. Harris, min. to Austria-Hungary, May 31, 1899, For. Rel. 1899, 50. To the same effect, see Mr. Bayard, Sec. of State, to Mr. Honey, March 21, 1887, For. Rel. 1888, I. 631. With reference to your instruction No. 141 of December 6, 1889, relating to the income tax imposed in Burmah upon American missionaries residing there, I have the honor to acquaint you . . . that I am now in receipt of a reply from the Marquis of Salisbury, dated the 18th instant, of which a copy (with its original printed enclosures) is also transmitted herewith, from which it will be seen that Lord Salisbury expresses his regret that the government of India, after a full consideration of the case, are unable to make an exception in favor of the missionaries. "It seems that Mr. Bunker, who addressed you in the matter, complains especially that the tax is charged upon, not only that portion of their salaries paid the missionaries in Burmah, but upon that portion thereof which is arranged to be paid directly to their families remaining in the United States. It would appear that the law requires the tax to be assessed upon income or profits accruing and arising or received in British India,' and that the government of India holds that the income of a missionary residing in India accrues or arises there, though it may not be received there. I venture to suggest that the income tax act in India, in this respect, does not seem to be more rigid than was our own act of 1862 (sec. 90, chap. 119, 2d session, 37th Cong.), under which a tax was laid upon the excess over $600 of the annual gains, profits, or income of every person residing in the United States." Mr. Lincoln, min. to England, to Mr. Blaine, Sec. of State, March 20, 1890, Instruction No. 141 of Dec. 6, 1889, to which Mr. Lincoln referred, ex- Missionaries in Japan are subject to the payment of an income tax on their salaries, precisely as are native priests. The Government, however, did not exact the tax from the surgeon and enlisted men of the Marine Corps stationed at the United States naval hospital at Yokohama. For. Rel. 1900, 760, 763. War taxes. "I acknowledge the receipt of your dispatches Nos. 92 and 93 of February 13th, 1870, with enclosures, relating to a tax recently voted by the legislative authority of Nueva Leon for the purpose of sustaining the existing Government of Mexico against insurrectionary assaults. "Whether the imposition of such a tax is within the powers of the several States, or is only competent to the Federal Congress, is a question of Mexican constitutional law which must be referred to the judicial tribunals of that country. If the State legislature could not authorize the tax in question, it is to be assumed that the judiciary of the country will furnish adequate protection and redress to those who may be aggrieved. It is vital to the existence of every government that it should have the capacity, through some of its legislative or administrative departments, to levy taxes necessary for its maintenance against rebellion, upon all persons, whether native subjects or foreign residents who enjoy its protection. The particular agency through which this shall be accomplished, is necessarily in the discretion of the government concerned. Citizens of the United States who voluntarily take up their residence in countries exposed to frequent insurrections, must be considered as having elected to take upon themselves the risks and expenses to which such condition exposes them in view of the advantages which in their estimation countervail the security which they would enjoy in the land of their native allegiance. "There is no objection to your authenticating such protest as any citizen of the United States may be advised to make, to avail for what it shall be worth." Mr. J. C. B. Davis, Assist. Sec. of State, to Mr. Ulrich, U. S. consul at 6 "Your letter of the 23d instant, in relation to a war-tax' recently imposed, as you allege, upon your property in Cuba, by the authorities of that island, has been received. You inquire whether you have the right to refuse the payment of that tax, and if in so doing you may depend upon the interposition of the Government of the United States, for redress in case of need.' The Spanish Government in common with every other independent power, possesses the exclusive right of imposing taxes upon property situated within the territories and jurisdiction of their own country, and of determining the purposes to which the revenues derived from such taxes shall be devoted. If therefore the tax to which you refer is general and uniform in its operation, upon property situated in Cuba, and makes no discrimination against the property of American citizens, it is not within the province of the Government of the United States to interfere." Mr. Fish, Sec. of State, to Mr. Bachiller de Toscano, Oct. 28, 1874, 105 "Referring to your despatches 630 of October 27, 1875, and 634 of the 29th of the same month, relating to the liability of citizens of the United States resident in Spain, for the payment of special or extraordinary taxes, called war taxes, I have to inform you that the questions treated of therein have been carefully considered. "The precise question, upon which you ask information and instruction, seems to be, admitting the liability of citizens of the United States resident in Spain for the payment of their fair and just proportions of the general public burdens, whether they are also liable to pay such particular taxes as may be imposed as war taxes eo nomine, and which are made necessary by the existing disturbances in Spain. "It appears that under the subsisting tax laws of Spain an extra tax of one-ninth part of the general tax is imposed, in addition to such general tax, as a war tax; that foreigners, of all nationalities. in Spain, while willing to pay ordinary taxes, have resisted payment of this particular amount; and that, in consequence of representations made in behalf of such foreigners, the Spanish Government after having decided at different times in different ways, has at last issued a general order, intended to apply hereafter to all cases of this nature. "This order provides, that whenever the citizens or subjects of any foreign power are by actual treaty provisions exempted from the imposition of a tax of this nature, they shall be relieved therefrom; that, where by treaty such citizens or subjects are made liable to pay such a tax, the same shall be collected; but that, where either no treaties exist, or where the existing treaties are silent on the question, the authorities of Spain, will exempt the citizens or subjects of such countries as exempt Spaniards resident therein under like circumstances, and will collect such taxes from those citizens or subjects where the countries to which they owe allegiance collect the same from resident Spaniards. "Your despatch clearly shows the difficulty in dealing with this question, and in claiming for citizens of the United States any positive exemption from such taxes, pursuant to treaty provisions; and your hesitation in addressing the Government of Spain on this question, in compliance with requests from your fellow citizens, was judicious. As a general proposition, it will be conceded that foreigners who have chosen to take up their residence, to purchase property, or to carry on business in a foreign country, thereby place themselves under the jurisdiction of the laws of that country, and may fairly be called upon to bear their fair share of the general public burdens, when properly imposed upon them and other members of the community, alike. As a general proposition, the right to tax includes the power to determine the amount which must be levied, and the objects for which that amount shall be expended. These powers are powers incident to sovereignty, the exercise of which, unless abused, can not, in general, be made the subject of diplomatic remonstrance. "If, therefore, the system of taxation in practice in Spain had imposed upon these American residents, in common with others, a certain tax, increased in amount, by reason of the disturbances in Spain, it would be impossible to distinguish what portion had been imposed particularly for war purposes, and it would be difficult to found any remonstrance, if the necessities of that government required greater taxation. It is believed that such is the system in this country, and that increased taxation must result from a war, or from any convulsion or cause which requires a large expenditure of money. "This Government would greatly hesitate to insist upon the exemption of citizens of the United States residing in Spain from such taxes as are referred to by you and as are borne by all Spaniards engaged in the same vocations, and thus perhaps establish a basis for a claim for exemption from such taxes as may hereafter be required by the public necessity in this country, when imposed on or demanded from Spaniards resident or carrying on business in the United States. “On an examination of the order issued by the Spanish Government in the light of these conclusions, and referring to your question whether reciprocity could be assured to Spaniards resident and engaged here in business from the payment of similar impositions, it is doubtful whether any such reciprocity could be assured, and more than doubtful, in view of the small amounts involved, and the small number of Americans affected thereby, whether such exemption. should be demanded. "I coincide therefore in your opinion as to the inexpediency of presenting this question to the Government of Spain, and have treated of it at some length, as cases not infrequently come before the Department of extraordinary extortions, under the name of taxation, practiced upon citizens of the United States; and while this Government is desirous of assuming no untenable position, it may be necessary to seriously remonstrate against the abuse of the power of taxation, which occurs in Cuba." Mr. Fish, Sec. of State, to Mr. Cushing, min. to Spain, Jan. 12, 1876, MS. "The right [of taxation] is admitted, but complaints are based on the fact that opportunity is taken under the cover of a right, to perpetrate wrong and injustice. . . . It is difficult (for instance) to call it a rightful exercise of the sovereign power of taxation, to require an individual owner of an estate to erect a fort, of a particular and specified description, on his estate, at his individual cost, or to require him to construct a particular line of telegraph; and when such things are done by an arbitrary order of a local or a military officer, they have very much the appearance of something very different from what is generally recognized as taxation." Mr. Fish, Sec. of State, to Mr. Cushing, min. to Spain, May 22, 1876, MS. Inst. Spain, XVII. 528. See note to Mr. Mantilla, Jan. 11, 1876, infra, § 1034. With reference to extraordinary war taxes levied in Cuba during the Ten Years' War (1868-1878), the Department of State said that, while it was difficult to protest against the exaction of such taxes on well-defined principles, it appeared that many of the taxes were loosely if not unfairly assessed, that they were excessive in amount, and that they not infrequently failed to be applied to the purposes for which they were raised. Besides, exemptions appeared to be sometimes granted, which made the burden all the heavier upon those who still remained liable. All these facts had created dissatisfaction and had called for remonstrance and complaint. The United States expressed the hope that its citizens in Cuba would not be treated in these matters differently from those of other countries, and that they would receive the full benefit of any relief which might be granted. H. Doc. 551-vol 2————5 |