Papers Relating to the Foreign Relations of the United States, With the Annual Message of the President, Transmitted to Congress, December 4, 1893

Mr. Gresham to Mr. Baker.

Department of State,
Washington, June 16, 1893.

No. 15.]

Sir: With his dispatch, No. 134, of May 10, 1893, Mr. Newell, consul to Managua, transmits translation of a decree issued by the executive power of Nicaragua on April 29, 1893, imposing a forced loan $600,000 throughout the whole Republic, reimbursable with 10 per cent interest “within two years after the constitutional order has been reestablished.”

While it may be premature to assume that the Provisional Government, which took control June 1 (as reported in your telegram of May 31), may be disposed to enforce the execution of the measure thus decreed by the preceding administration of President Sacasa, it may be well, out of abundant caution, and to forstall any possible invasion of the rights of citizens of the United States in this regard, to call your attention to the stipulation of article 9 of the treaty of 1867 between the United States and Nicaragua, which provides that “the citizens of the United States, residents in the Republic of Nicaragua * * * shall be exempted from * * * forced loans in time of war.” The decree in its preamble recites that it is enacted “on account of the rebellion which has broken out in the departments of Granada and Masaya,” and that its purpose is “to create resources to help the maintenance of the army,” which it was found necessary to raise in order to restore public order. It is therefore a “forced loan in time of war” within the clear intent of the treaty; and it is not supposable that its collection will continue after the cessation of the emergency it was designed to meet.

You will report whether the collection of the forced loan in question has been effected from any citizens of the United States resident in Nicaragua. If it has, you will make due protest and ask that the amounts so collected be refunded.

A copy of the decree is inclosed for your more convenient reference.

I am, etc.,

W. Q. Gresham.

[Inclosure in No. 15.]

Decree.

The Government, on account of the rebellion which has broken out in the departments of Granada and Masaya to-day, in the morning, the same taking possession of the “plazas” at those towns, and considering that the first and main duty which the constitution imposes on the executive is the conservation of public order, and that in order to reestablish it in the present crisis it is indispensable to create resources to help the maintenance of the army which it has been ordered to raise.

decrees.

Art. 1. A forced tax of six hundred thousand dollars is imposed for the present, throughout the whole Republic, distributed in the following manner:

In	Granada department	$120,000
	Leon department	80,000
	Managua department	80,000
	Chenandega department	50,000
	Masaya department	30,000
	Carazo department	40,000
	Chantales department	40,0000
	Rivas department	50,000
	Matagalpa department	40,000
	Jinotega deparment	20,000
	Esteli department	22,000
	Ocotal department	28,000
		$600,000

Art. 2. For the collection of these sums from the inhabitants of each department there will be boards which will be organized in every capital and in (each) of the cities and towns of every department.

Art. 3. The first will be composed of three individuals—the prefect and two citizens; the second one will be composed of the first judge of the place, the other two citizens to be appointed by the same judge.

Art. 4. Each board of the capital will attend to the following:

(1) To assign to the towns of the department the sum which it must contribute.

(2) To keep a nominal register of the contributors.

(3) To listen to the complaints of those who claim a rebate of their tax on account of said tax not being proportional to their capital, in which case the board will notify the respective local board, so that the sum assigned to the town may be modified.

Art. 5. The functions of the local board are:

(1) To distribute among the inhabitants the sum which has been assigned to the town or city.

(2) To executively collect the amounts which they have assigned to the neighbors.

(3) To give to the inhabitants assessed a receipt for the amount received and to register their names in a book kept for that purpose.

(4) To rebate or increase the individual tax whenever the board of the capital orders it, and in its turn make the corresponding rectifications pointed out in part 3 of the former article.

(5) To remit, within the first eight days of every month and under their responsibility, the exact tax of their locality to the prefect of their department.

(6) To impose fines, up to twenty dollars, upon such individuals who in anyway put obstacles to the compliance of this law without failing at the same time to collect the contribution.

Art. 6. The prefect may also impose fines of from ten to fifty dollars upon the individuals of the board of the capital, or to any of those of the local boards who may show themselves negligent in the compliance of his duty. All these fines must be collected promptly and must be added to the respective local fund.

Art. 7. The prefects will keep, in a separate book, an account of the amounts received from the local boards.

Art. 8. The tax receipts given by the local boards will be exchanged at the prefect’s office, for a bill of credit against the Republic; said bill of credit will also be registered in its turn at the chief auditor’s office, and at the general treasury, after being signed by the prefect, who will receive from the minister of finance the corresponding forms.

Art. 9. The amounts collected by virtue of the present law will go to the respective treasury offices. The prefect must give an account of the same, as well as the administrator of rents, to the chief accountant’s office.

Art. 10. The Government will pay this tax, the latest, within two years after the constitutional order has been reestablished. It will draw 6 per cent annual interest upon the amounts received, The Government will pay 10 per cent annual interest to those who anticipate the payment of the tax assigned them.

Given in Managua, April 29, 1893.

Roberto Sacasa.