B-136449, JUN. 24, 1958

B-136449: Jun 24, 1958

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GENERAL SERVICES ADMINISTRATION: REFERENCE IS MADE TO LETTER OF JUNE 16. WHICH IS OWNED BY THE CUBAN NICKEL COMPANY. ALL THE STOCK OF WHICH IS OWNED BY THE UNITED STATES. BEYNON SUBSEQUENTLY ADVISED US THAT HIS QUESTION WAS WHETHER YOUR ADMINISTRATION'S APPROPRIATIONS MAY BE USED TO PAY TAXES ON THE PROPERTY IN QUESTION IF THE EXISTING DECREES ARE REVOKED OR MODIFIED BY THE CUBAN GOVERNMENT AND A DECREE ISSUED BY THAT GOVERNMENT REQUIRING THE PAYMENT OF CERTAIN TAXES ON THE PROPERTY. IT APPEARS THAT THE RIGHT OF THE UNITED STATES TO TAX EXEMPTION ON THE PROPERTY IS BASED SOLELY ON THE DECREES ISSUED BY THE CUBAN GOVERNMENT. IF THESE DECREES ARE REVOKED OR MODIFIED AND A DECREE ISSUED BY THE CUBAN GOVERNMENT REQUIRING THE PAYMENT OF TAXES ON THE PROPERTY IT APPEARS THAT YOUR APPROPRIATIONS OTHERWISE PROPERLY AVAILABLE MAY BE USED TO PAY SUCH TAXES.

B-136449, JUN. 24, 1958

TO HONORABLE FRANKLIN FLOETE, ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO LETTER OF JUNE 16, 1958 (YOUR REFERENCE: AN) FROM MR. IRA D. BEYNON, SPECIAL ASSISTANT TO THE ADMINISTRATOR (NICARO PROJECT), CONCERNING THE PAYMENT OF TAXES ON A NICKEL PLANT AT NICARO, CUBA, WHICH IS OWNED BY THE CUBAN NICKEL COMPANY, A CUBAN CORPORATION, ALL THE STOCK OF WHICH IS OWNED BY THE UNITED STATES.

THE LETTER REQUESTS A DECISION AS TO THE PROPRIETY AND LEGALITY OF CARRYING ON NEGOTIATIONS WITH THE CUBAN GOVERNMENT FOR A DECREE TO BE ISSUED BY THAT GOVERNMENT PROVIDING FOR THE PAYMENT OF CERTAIN TAXES ON THE PLANT IN QUESTION, THE PLANT NOW ENJOYING ALMOST COMPLETE TAX EXEMPTION UNDER THE DECREES NOW IN FORCE. HOWEVER, MR. BEYNON SUBSEQUENTLY ADVISED US THAT HIS QUESTION WAS WHETHER YOUR ADMINISTRATION'S APPROPRIATIONS MAY BE USED TO PAY TAXES ON THE PROPERTY IN QUESTION IF THE EXISTING DECREES ARE REVOKED OR MODIFIED BY THE CUBAN GOVERNMENT AND A DECREE ISSUED BY THAT GOVERNMENT REQUIRING THE PAYMENT OF CERTAIN TAXES ON THE PROPERTY.

IT APPEARS THAT THE RIGHT OF THE UNITED STATES TO TAX EXEMPTION ON THE PROPERTY IS BASED SOLELY ON THE DECREES ISSUED BY THE CUBAN GOVERNMENT. THEREFORE, IF THESE DECREES ARE REVOKED OR MODIFIED AND A DECREE ISSUED BY THE CUBAN GOVERNMENT REQUIRING THE PAYMENT OF TAXES ON THE PROPERTY IT APPEARS THAT YOUR APPROPRIATIONS OTHERWISE PROPERLY AVAILABLE MAY BE USED TO PAY SUCH TAXES.

WE ARE SENDING THE SECRETARY OF STATE A COPY OF THIS LETTER IN ACCORDANCE WITH MR. BEYNON'S ..END :