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United States Department of State / Foreign relations of the United States diplomatic papers, 1934. The American Republics

Colombia,   pp. 66-85 PDF (7.2 MB)

Page 85

611.2131/267: Telegram
The Charge' in Colombia (IWashington) to the Secretary of State
                               BOGOTA, December 31, 1934-11 a. m.
                                            [Received 12: 55 p. m.]
  115. Department's 74, December 29, 3 p. m. General confusion
existing today in Colombian executive circles makes it advisable to
postpone conversations regarding commercial treaty for several days.
  For my information in conversations, please inform me whether
the Colombian Government was given to understand that United
States Federal Government could and would prevent the imposition
of municipal sales taxes on coffee under the terms of the agreement of
December 15th, 1933.
611.2131/267: Telegram
   The Secretary of State to the Charge in Colombia (Washington)
                            WASHINGTON, January 9, 1935-6 p. m.
  2. Your 115, December 31, 11: 00 a. m. There is no provision in the
agreement of December 15, 1933, which would prevent, without quali-
fication, the collection of municipal sales taxes in the United States
on coffee or any other product imported from Colombia and no assur-
ances have been given to the Colombian Government at any time that
the Federal Government of the United States could or would prevent
in general the imposition of such taxes under the terms of the agree-
ment or otherwise.
  In the course of the negotiations leading to the agreement men-
tioned, it was fully explained to the Colombian technical experts that
the weight of legal authority strongly inclines to the view that, under
the constitutional regime in the United States, the Federal Govern-
ment is without power, whether by treaty or statutory enactment, to
prohibit states or municipalities from imposing excise or consump-
tion taxes, including, of course, sales taxes, except with respect to taxes
directly affecting interstate or foreign commerce.
  Accordingly, it will be noted that the provisions of Article IV of
the agreement in question, relating to national treatment and limita-
tions upon the amount of state and municipal taxes in the United
States, are limited to excise or consumption taxes which affect inter-
state or foreign commerce and are or may be subject to statutory con-
trol by the Federal Government in the exercise of its constitutional

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