825.506/13: Telegram
The Ambassador in Chile (Collier) to the Secretary of State
[Received 6:40 p.m.]
129. Supplementing my 114.33 Joint committee has reported insurance bill with amendments to Chamber of Deputies. All efforts by myself and commercial attaché and interested American enterprises to get printed or specific information about committee amendments have so far been unavailing, report “not yet having been printed for distribution”. It is understood that existing foreign agencies will be allowed to continue business with present personnel and without reorganizing as national companies upon condition that in addition to amount required for mathematical reserves they invest 2,000,000 [Page 546] pesos in Chilean securities or property that can be readily liquidated and that they pay a tax on premiums collected 50 percent greater than the tax to be paid by national companies.
Former section 59, modified and now made section 46, is said to provide that every person or company who insures property located in Chile in companies not established in Chile must pay a tax “variable between 15 and 20 percent of the premium that would be collected by a Chilean national company”, the President of the Republic to be authorized to fix the tax within these limits. It is uncertain whether policies taken out in foreign companies whose existing agencies may be continued by them under the new law will be subject to this tax.
Shall I protest against discriminatory taxation and also against second-mentioned tax so far as it affects policies on Chilean property taken out in the United States by Americans not residents of Chile? Cable promptly, measure likely to be rushed through. Nationalistic sentiment strong, mere representations as to promotion of mutual interests by equal or liberal treatment not apt to produce results.
- Dated Aug. 30, 1927, 11 a.m.; not printed.↩