2578 March 31, 1028 . luue 8, 1t28. DOUBLE INCOME TAX-SHIPPING PROFITS-JAPAN. Exchange oj notes between the United States and Japan proLiding jor relieJ jrom double income tax on shipping profits. Signed March 31, 19S6, and June 8, 1926. No. 41. SIR: The Japanese Ambassador to the Secretary oj State JAPANESE EMBASSY WASHINGTON, March 31,1926 OD~~:~~;::~ tax With reference to your note dated September 1, 1925, concerning ReclJ:::lSt e1emP d the reciprocal exemption from taxation of income derived from the }~:an. Di atesaD operation of merchant vessels, I have the honor to state, under instructions from Tokio, that my Government is happy to signify its willin~ess to agree with the views of the Treasury Department as stated in your note under acknowledgment; namely, that the recip- rocal exemption shall be carried out from and including July 18, 1924, the date on which the Japanese Law No.6 was promulgated, without adopting the methods suggested in my note dated June 18, Vol. 43 , pp . 269, 263. 1925; and, furtlier, that the exemption from taxation accorded by Section 213(b)(8) of the Revenue Act of 1924 applies only to such income as is derived from sources within the "United States" as that term is defined in Section 2 of the said Act, and from sources within the Virgin Islands. In brl~g the above to your knowledge, I am happy to note that a unanimIty of views has been reached between our two Governments on this subjectJ., .and shall be glad if you will be good enough to take step~ with the Treasury Department to the end that an arrangement looking to the reciprocal exemption in question be put into force. Accept, Sir, the renewed assurances of my highest consideration. HONORABLE FRANK B. KELLOGG, Secretary oj State. T. }.{ATSUDAIRA The Secretary oj State to the Japanese Ambassador EXCELLENCY: DEPARTMENT OF STATE WASHINGTON, June 8, 1926. st!~entb)'unlted Referring further to your note of March 31, 1926, and to previous correspondence in regard to the establishment by the United States and Japan of reciprocal exemption from taxation of income derived from the operation of merchant vessels, I have the honor to inform you of the receipt of a letter on the subject from the Secretary of the Treasury dated May 26, 1926. The Secretary of the Treasury states that he approved, on :Feb- ruary 1, 1926, Treasury Decision 3812 embodying the ruling that from July 18, 1924, Japan satisfies the equivalent exemption provi-
