Mr. Denby to Mr. Olney.
Peking, October 20, 1896. (Received Nov. 30.)
Sir: In several dispatches I have mentioned and discussed to some extent the effect that the fourth clause of Article VI of the Shimonoseki treaty might have on the question of taxation of goods manufactured in China by foreigners.
The latter part of that clause reads as follows:
All articles manufactured by Japanese subjects in China shall, in respect of inland transit and internal taxes, duties, charges, and exactions of all kinds, and also in respect of warehousing and storage facilities in the interior of China, stand upon the same footing and enjoy the same privileges and exemptions as merchandise imported by Japanese subjects into China.
I have learned since preparing my dispatch No. 2614 of October 18 that the Japanese Government did, on the 16th instant, officially and formally renounce that part of said clause above quoted.
In the consideration of questions affecting taxation, and the increase of the tariff rates concerning which I wrote in my dispatches No. 2587 of August 29 and No. 2593 of September 3, this clause must be eliminated, a result which greatly affects the position of foreigners who desire to engage in manufacturing in China.
I have, etc.,