611.573/60
The Norwegian Minister (Morgenstierne) to the Assistant Secretary of State (Sayre)
Sir: Your note of the 3rd instant2 in which you kindly quoted certain portions of a letter from the Treasury Department on the subject of the importation tax on whale oil imposed by the Revenue Act of 1934,3 has been submitted to my Government. In this connection I have been instructed to express the disappointment of the Norwegian Government that the Treasury Department has not found it possible to accept their interpretation of the tax in question. My Government has once more carefully reviewed this matter with the result that they cannot but maintain their understanding of the nature of this tax as set forth in my letters to you of June 304 and October 25, 1934.5 I beg leave to refer to these letters, quite particularly to the summary of our position as stated on page 3 of my letter of October 25, 1934.
I have been instructed to add that also apart from this particular matter it has afforded my Government concern that there has been incorporated in the Revenue Bill of 1934 a tax which, according to the interpretation of the Treasury Department “for the purposes of all provisions of law, including treaties of the United States” is a “customs duty”. The consequence of this would seem to be that quite apart from the existing Tariff legislation there may, under the heading “Excise Taxes”, be imposed on Norwegian articles to be imported into this country an extra tax which for all legal and practical purposes is a Tariff duty, and which definitely excludes such Norwegian article from the American market.
In this connection my Government points out that on the basis of the latest whale oil sales in Europe the existing customs duty plus the new tax on whale oil would together amount to a duty of approximately [Page 621] 170 per cent ad valorem. My Government feels that if this new measure had been proposed in the form of an addition to the already existing customs duty, its severity would have become so apparent that it might not have been imposed on a well established Norwegian article which forms a vitally important item in our mutual balance of trade.
Accept [etc.]
- Ibid., p. 673.↩
- 48 Stat. 680, 762.↩
- Foreign Relations, 1934, vol. ii, p. 647.↩
- Not printed.↩