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PHILADELPHIA, PA., February 15, 1901.

Chairman Ways and Means Committee,

Washington, D. C.

DEAR SIR: Referring to the statement that the National Canners' Association is making representations before the Ways and Means Committee with a view to the admission of foreign tin plate into the United States free of duty for the canners, it may be that your committee will not see your way to altogether grant the request of the National Canners' Association. This is a matter between you and them, and the writer is not making any request either way with regard to same, as such a matter has to be looked at from both sides. But there is another manner, and an important manner, in which every important "line" could be helped by your committee doing what I have urged upon it in previous communications, namely, simplifying the administration of section 30 of the present tariff act, and changing it so that the exporter would not have to swear that all the tin plate in his exported articles, for instance, was positively foreign, but he would only have to prove that he was not getting drawback on more tin plate than the imported tin plate which he actually had. We repeat that it is easy enough for a very large mill having quite an export business, or for a rather small mill doing exclusively an export trade, to keep separate the foreign material in all the stages of manufacture, but for a mill at present which does not do much export business it is impracticable, and for any moderate size American canner to make a beginning of getting export trade by aid of the drawback of duty as now granted, under the ruling of section 30, means, as so many of them have told the writer, that they either have to swear to a lie or as they more generally say, have to give up the attempt because of the trouble involved of keeping separate the import material through all stages of manufacture from the general run of their material which is naturally American.

This interest or that interest may ask your honorable committee for reduction of such and such a duty or for increase of such and such a duty and for reasons of revenue and reasons of fairness your committee probably will have to refuse ninety-nine requests out of a hundred, but as a compensation to the disappointed and as showing that the granting to American manufacturers of the ability to get hold of foreign trade is a real thing, and not one which is saddled with conditions that render it useless to the majority, your committee can score a good point, doing something that would be to the interests of practically everybody, and this would be done by changing the law and methods of administering the law as outlined in this letter and in the previous letter which the writer has had the honor to lay before you.

Yours, truly,


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[Section 34.]



17 BATTERY PLACE, New York, January 30, 1909.

Washington, D. C.

GENTLEMEN: I respect fully suggest to the committee the advisability of revising the statute of limitations applicable to the determination of the amount of duty upon imports.


Section 21, act of June 22, 1874 (18 Stat. L., 190), reads as follows: That whenever any goods, wares, and merchandise shall have been entered and passed free of duty, and whenever duties upon any imported goods, wares, and merchandise shall have been liquidated and paid, and such goods, wares, and merchandise shall have been delivered to the owner, importer, agent, or consignee, such entry and passage free of duty and such settlement of duties shall, after the expiration of one year from the time of entry, in the absence of fraud and in the absence of protest by the owner, importer, agent, or consignee, be final and conclusive upon all parties.

This section (with other statutes of limitation) has been saved from repeal by the following clause in the various tariff acts:

All acts of limitation, whether applicable to civil causes and proceedings or to the prosecution of offenses or for the recovery of penalties or forfeitures embraced in or modified, changed, or repealed by this act, shall not be affected thereby.

This clause appears in section 34, tariff act of 1897; section 72, tariff act of 1894; section 55, tariff act of 1890; section 29, customs administrative act of 1890, and section 13, tariff act of 1883. This law has been construed as follows:

1. It applies to the United States; "all parties" includes the United States. (United States. Phelps, 17 Blatchf., 312, 316; United States v. Sidenberg, 17 Fed. Rep., 227.)

2. It has no reference to the original decision of the collector fixing the amount of duty, but only applies to reliquidations for making changes in the first liquidation. (United States v. De Rivera, 73 Fed. Rep., 679; Gandolfi v. United States, 74 Fed. Rep., 549; Abner Doble Co. v. United States, 119 Fed. Rep., 152.)

3. Having once liquidated, the collector can not reliquidate if one year has expired from the date of entry. (Beard v. Porter, 124 U. S., 437.)

4. Delivery of the goods to the importer and payment of duties does not prevent reliquidation within a year. (United States v. Mex. Int. R. Co., 151 Fed. Rep., 545; Louisville Pillow Co. v. United States, 144 Fed. Rep., 386.)

5. As to the absence of protest, there is apparently a conflict of decision. The former opinions seem to have been that the words "in the absence of protest were intended to avoid interference with the proceedings leading to decision on protest and settlement

in accordance therewith. Thus it was held that where a protest had been previously allowed and refund made a subsequent reliquidation more than a year from the date of entry was "in the absence of protest" and too late. It was also decided that where a protest related only to certain goods, and was sustained, the collector could not reliquidate as to other goods, not in the protest but in the same invoice, the year having expired. (United States v. Leng, 18 Fed. Rep., 15; United States v. Fox, 53 Fed. Rep., 531; United States v. Cassell, 146 Fed. Rep., 146.)

In a recent case, however, it has been held that the statute is suspended during the pendency of a protest, so that the collector may, after a protest is decided, make any new liquidation he pleases, provided only that a year has not expired, excluding the period for which the protest was pending. (Klumpp v. Thomas, 162 Fed. Rep., 853.)

It is believed the purpose of the law is that there shall come a time when the importer may know that the collector can not demand anything more from him: that, even if the collector decided wrongly, he can not enforce collection after the matter has been allowed to become stale. The period adopted by the act of 1874 is one year from the time of entry, and the same period is fixed for the correction of clerical errors by section 24, customs administrative act of June 10, 1890.

If this is a correct statement of the policy, there should be a limitation on the first liquidation as well as on subsequent ones. We have now the anomalous situation that the first liquidation may be made five or ten years after entry, but the second or third liquidation must be made within one year, in the absence of protest.

When an entry of merchandise is made, the importer is required to state the nature of the goods and quantities and values, compute the total amount of duty, and pay that amount at once, before he gets his goods. If the collector subsequently approves this entry (as he does in probably more than half the cases) he liquidates it" no change and sends no notice to the importer, as nothing remains to be done. He only sends a notice where the liquidation shows a balance due the Government or a refund due the importer. Therefore, if the importer hears nothing within three or four months, he is apt to assume that the entry has been liquidated without change, that being about the average time for liquidations at the port of New York. In the occasional case, where the entry is mislaid in the custom house, or for any other reason is not liquidated, should the collector be allowed, several years after, when the transaction has been forgotten, to liquidate the entry and demand additional payment from the importer? In the De Rivera case, supra, this was done eight years after entry.

The importer is limited to fifteen days, and if he fails to file a protest within that time, or files a wrong protest, the liquidation is conclusive upon him, whether right or wrong. As the collector always resolves all doubts in favor of the Government, it would seem that he should not require very much time to come to a conclusion. The only reason for delay is where there are protracted reappraisement proceedings, as the liquidation can not be made until they are completed.

In place of section 21, act of June 22, 1874, I suggest two sections, as follows:

SEC. That every entry of merchandise, whether for warehouse or consumption, shall be liquidated by the collector or person acting as such, within sixty days after the date when the values of all the goods included in said entry have been finally fixed by the appraiser without appeal, or by a single general appraiser without further appeal or by a board of three general appraisers, and in case of any failure to make the liquidation within the time herein prescribed, the entry shall be deemed to have been liquidated without change on the sixtieth day after the values are finally fixed.

SEC.. That whenever any goods, wares, and merchandise shall have been entered and passed free of duty, and whenever duties upon any imported goods. wares, and merchandise shall have been liquidated and paid, and such goods, wares, and merchandise shall have been delivered to the owner, importer, agent, or consignee, such entry and passage free of duty and such settlement of duties shall, after the expiration of one year from the time of entry, in the absence of fraud, be final and conclusive upon all parties: Provided, That this section shall not be construed to prevent the resettlement of duties in accordance with protests and decisions thereon by the Board of General Appraisers and the courts.

The first of the proposed sections refers to the "entry of the merchandise" in order to avoid confusion with the entry of the vessel, a term applied to the filing of the manifest of the vessel by the master.

The time suggested, sixty days, could of course be lengthened in the discretion of Congress without changing the general purpose, but as the sixty days begins to run after all the appraisements are completed, it is thought to be ample.

The provision that the entry shall be deemed to be liquidated on the sixtieth day is necessary to make it effective.

It is not thought necessary, in the first proposed section, to make any exception of cases of fraud, because the section only deals with the first liquidation, and does not prevent the collector from making a reliquidation afterwards.

The second proposed section is the same as the act of 1874, except that the words "in the absence of protest " are stricken out and the proviso added. This is thought the most important of the suggestions herein made. To illustrate how the rule of the suspension of the statute during the pendency of a protest would work: Suppose there are two importers of cotton cloth, both of whom enter their goods and pay duty at 40 per cent; one of them finds that there were 10 pieces missing, which were on the invoice and on which he has paid duty; he files a protest claiming an allowance for the 10 pieces that were not imported; when his protest is decided a year has expired, but the statute has been suspended, and the collector is then of the opinion that cloth of that character is dutiable as an etamine at 60 per cent; he reliquidates, offsets the new demand against the refund, and either pays back a smaller amount or demands an additional payment, as the case may be. The other importer, who was lucky enough not to lose any of his goods in transit, is protected by the statute of limitations.

It may be said that this matter is of no importance as to the great bulk of the business transacted at the custom-houses, and that is unquestionably true. But these exceptional cases occur more frequently than might be expected, and they usually cause a great hardship when they do occur. The attitude of collectors generally is to enforce all the rights of the Government, no matter how technical or

burdensome, and they are justified in enforcing the laws as they find them. It is therefore only to Congress that an appeal can be made in the name of justice or equity.





PENSACOLA, FLA., December 3, 1908.


Washington, D. C.

GENTLEMEN: The only tariff that will ever give universal satisfaction is one that will adjust itself to the varying conditions of trade, and the only way that such a tariff can be obtained is by applying a sliding scale to the tariff rates. It would not be necessary to apply the scale to all the rates, but only to the rates on the principal articles of import.

My plan is automatic and self-adjusting, giving tariff revision whenever needed. The principle is as follows:

A basing price for each commodity to be fixed by act of Congress. Whenever the market price of a commodity is the same as this basing price, the present rate of duty on that commodity to be in force; but when the market price rises the tariff rate falls, and the tariff rate automatically adjusts itself to the market price thus: In the case of pig iron, for example, when the market price in Pittsburg is $16 per ton (and supposing that to be the basing price) the full rate of $4 per ton to be in force; but when the market price is $17 per ton the duty to be $3 per ton, and when the market price is $18 per ton the rate to be $2 per ton, and when the market price is $19 per ton the rate to be $1 per ton, and when the market price is $20 per ton the duty to be free.

In the case of commodities having an ad valorem rate of duty the rate to fall 1 per cent for every per cent that the market price rises above the basing price, the rate to fall as the price rises and rise as the price falls.

In the case of commodities having both an ad valorem and specific rate of duty the scale to apply on the ad valorem rate.

While the basing prices would of necessity be established by Congress, the prices so established could be the average prices which have obtained during any series of years of normal prosperity, with additions or deductions to meet the changing cost of production.

The method of administering this law would be as follows:

An importer desiring to make an importation under a special rate, as provided in the law, would file an application at the custom-house in New York or San Francisco, stating the lowest price at which he could purchase the commodity. These applications would be posted in the custom-house for a period of ten days and published daily, to permit manufacturers or producers to file answers to them offering to sell at lower prices. When these offers to sell are as low as the basing price, the applications to be returned to the applicants; in other

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