File 868/1904 Pt 1 'Consular: Exemption of Foreign Consular Officers from Imperial and Municipal Taxation' [‎187v] (74/113)

I am now to enclose, for Lord George Hamilton’s confidential in
formation, a copy of a memorandum upon the subject that has been
prepared in this Office, and I am to suggest that the attention of the
Government of India might be called to the decision arrived at in 1875,
and to the inexpediency of raising the question anew in view of the wide
reaching consequences involved.
It seems to Lord Salisbury to be desirable that matters should be
suffered to remain on the same basis as heretofore, and that the
exemptions, already granted, should be continued to the officers
concerned.
I am, &c.,
F. H. VlLLIERS.
The Under Secretary of State
for India.
, '{' ■ ■
Enclosure in No. 5.
Foreign Office Memorandum.
Liability of Foreign Consuls in India to Imperial and Municipal
taxation.
This very awkward and delicate question has been lying dormant
for many years and there seems to be no good reason why it should be
revived.
After a very careful examination of all the issues, an interchange of
views with the India Office The department of the British Government to which the Government of India reported between 1858 and 1947. The successor to the Court of Directors. , and a reference to the Law Officers, Lord
Derby decided in 1875 that the claim of the Turkish Consul-General at
Bombay to exemption from Imperial and Municipal taxation could not
be resisted, in view of the terms of Article VIII. of the Treaty with
Turkey of 1809.
The correspondence extended from 1872 to 1875 and terminated in
an assurance to the Turkish Ambassador that the Consul-General would
be exempted, and in an instruction to the Bombay Government in the
same sense.
In coming to this conclusion Her Majesty’s Government were
evidently fully aware of the far-reaching consequences of their decision,
and of the fact that, strictly speaking, all Turkish Consuls in Her
Majesty’s Dominions are entitled to claim similar exemption, even
though they do not avail themselves of the right; whilst all Powers,
possessing most-favoured nation treatment under Treaty, such as Persia
and Italy, might, if so minded, ask for equal privileges.
Indeed, the Persian Consul-General in India was subsequently
exempted, like his Turkish colleague, and it seems clear from the
correspondence that although the treatment was nominally accorded as
a matter of courtesy, that form was only adopted to save the situation.
The privilege, admitted in 1875, was evidently granted to the Office,
not to the person, of the Turkish Consul-General, and to that of the
Persian Consul-General respectively, and the course then adopted seems
to have answered its purpose and prevented further discussion, which
might have proved very inconvenient for us.
In these circumstances it seems unwise of the Bombay Government
not to have “let sleeping dogs lie.”
They have withdrawn the exemption from municipal taxation from
the present Persian Consul-General, and the India Office The department of the British Government to which the Government of India reported between 1858 and 1947. The successor to the Court of Directors. now propose to
approve this, and to extend it by withdrawing the exemption from
Imperial Customs dues from the Persian Consul-General as well as from
the next Turkish Consul-General at Bombay.
As there is no alteration in the Treaty situation since 1875, the reason
for this change of front is not clear, and it seems likely to lead to
mischievous consequences.