Page:United States Statutes at Large Volume 55 Part 2.djvu/491

 55 SrAT.] PANAIMA-TAX ON SHIPPING PROFITS- an. 15, Feb. 8, 1941 1365 Aar. 28, 1941 I take pleasure in forwarding herewith to Your Excellency the documents, [l] duly authenticated, which contain the legal provisions of the Republic of Panama by which shipping companies incorporated under the laws of the United States are exempted from any tax. I should be very grateful if Your Excellency-provided you deem fit-would transmit the above-mentioned provisions to the Treasury Department in order to obtain the declaration desired by my Govern- ment. The documents which are being forwarded are the following: a) officially issued booklet containing all the laws and decrees which show that the Republic of Panama does not impose taxes upon the shipping industry of the United States; b) copy of Executive Resolution No. 33-bis, of 1936, and c) certificate of the Secretary of State in the Office of Hacienda and Treasury, in which it is expressly stated that "the merchant ships of the United States of America or of citizens of that country" are exempt from the income tax. The legal provisions to be found in the above-mentioned documents may be summarized as follows: 1) A tax is imposed by the Republic of Panama upon the net earnings of all persons in accordance with the "Ley del Fondo Obrero y del Agricultor," law 49 of 1934. 2) By Executive Resolution No. 33-bis, of March 2, 1936, the following was decreed: "Revenues which are derived from the operations of maritime commerce of merchant ships belonging to cor- porations organized in the United States of America or to citizens of that or any other country who reside either in Panama or abroad, are not subject to the tax of the "Fondo del Obrero y del Agricultor" created by law 49 of 1934, even though the transportation contracts may be drawn up in Panama". 3) The National Assembly of the Republic of Panama enacted in 1938 a new tax law known as law no. 62 of 1938. This law has not been put into force, due to its having been suspended by Decree No. 41 of April 5, 1939, and by Decree No. 146-bis of December 30, 1939. In view, therefore, of all that has been cited above, my Government would be very much pleased if Your Excellency's Government would give the assurance that, subject to changes of the law in the future, the citizens of the Republic of Panama and firms incorporated under Panamanian laws have been since 1936 and will henceforth be exempt from the tax on profits derived from maritime operations, as provided 5 t cat.§7, 78.1 in sections 211 (b) and 231 (d) of the Internal Revenue Code of the (b), 231 (d) United States of America. I [Not printed.] 278941o-42-PT. II - 31

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