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It will be observed that Bath, Me., levies more taxes on its shipping than are paid by the North German Lloyd Company on over $15,000,000 of shipping to Germany; that Portland levies more taxes than the Cunard Company paid to Great Britain last year on nearly $9,000,000 of shipping; that Portland taxes are greater than those paid even by Gloucester, Mass., or Detroit, Mich., on about $1,500,000; that taxation in Maine appears to be three times heavier than in California, double that of Georgia, and many times greater than in England, France, or Germany. Indeed, none of the three great transatlantic lines could have been operated profitably under the Maine tax laws, as those laws would have levied taxes on them greater than the amount any of those companies paid as dividends last year:

That the taxes levied on shipping at Gloucester last year were more than those paid by the North German Lloyd Company on over $15,000,000 shipping to the German Government, or those paid by the Cunard Company on over $9,000,000 of shipping to the British Government, and the taxation at that port for State and local purposes is double the rate imposed at San Francisco, or Savannah, Ga., on shipping: That the taxation on shipping at Charleston, S. C., is five times heavier than that levied by Great Britain or Germany:

That American shipping at Savannah was taxed last year for State and local purposes a sum more than the Cunard Company paid to the British Government on over $9,000,000 of shipping, and that the burden of taxation appears to be four times heavier in Georgia than in France and nearly six times heavier than in Germany:

That while Alabama exempts from taxes vessels engaged in the foreign trade, the taxes on coasting vessels at Mobile last year were double those paid by the Pacific Steam Navigation Company to the British Government on over $6,500,000 of vessel property:

That the taxes levied on shipping at New Orleans last year were more than the Compagnie Generale Transatlantique paid on $22,000,000 of shipping to the French Government; than the two great German lines the North German Lloyd and the Hamburg-American Line-paid on their combined shipping, valued at over $25,000,000, and were three times the taxes paid by the Cunard Company on over $9,000,000 to the British Government:

That San Francisco levied last year $85,675 taxes, a sum within $600 of the combined taxes paid by the Cunard Line, the HamburgAmerican Line, the North German Lloyd, and the Compagnie Generale Transatlantique to their respective governments, their combined shipping comprising upward of 700,000 tons of the best steel and iron steamships in the world, valued at upward of $58,000,000:

That the taxes on shipping for State and local purposes at Detroit were in amount virtually what the North German Lloyd paid on over

$15,000,000 of shipping to the German Government, and more than the Cunard or the Hamburg-American lines paid to their respective governments on over $9,000,000 each:

That on its shipping Milwaukee levied taxes greater than those paid by the Cunard Company to the British Government on over $9,000,000 of shipping:

That the taxes levied on shipping at Cleveland, Ohio, last year were more than the combined taxes paid to the German, French, and English governments by their three great steamship lines, the North German Lloyd, the Compagnie Generale Transatlantique, and the Cunard Line on their $48,000,000 of shipping.

The bearing of State taxation on the growth of our shipping is entitled to even more consideration than, hitherto, in view of the fact that for the first time in some years the Federal Government is about to impose a tax on that property. Incomes over $4,000 derived from the earnings of shipping are to be taxed 2 per cent annually as earnings from any other source, and while the number of American shipowners who have derived incomes of over $4,000 from their vessels is probably not large, the ships, earnings of which are to be taxed under this law, will be the growing portion of our merchant marine. The Federal income-tax law will subject our shipping to the same mode of taxation as that employed by Germany and Great Britain. The rate established, 2 per cent, is lower than the British rate of income tax, which for some years has averaged 24 per cent, and it will not, therefore, place our navigation at a disadvantage. But if heavy State and local taxes are also to be maintained, any development of our merchant fleets which may become possible under changes in the navigation laws will be confined to States which remove undesirable burdens from shipowning interests. That these interests have not already secured the removal of these burdens is evidence of a failure to exert their influence in lawmaking bodies, as well as testimony to the existence of one cause which retards and, until removed, will continue to retard the attainment of our full measure of strength in navigation. It is believed that a prompter and more effectual method to obtain relief than an appeal to Congress, which is sometimes advised, would be to put to the test the constitutionality of State laws in view of decisions of the United States courts, or, better still, to apply to State legislatures for the passage of more liberal laws, of which the law of the State of New York, found in Appendix F, is a type. It may be added that the recent constitutional convention in that State, when considering exemptions of property from taxation, determined that the exemption of shipping in foreign trade should continue.

While this Bureau desires to keep strictly within the lines prescribed for its conduct, it has deemed the bare facts, set forth above, of sufficient importance to bring them to the notice of the governors of seaboard and lake States, boards of trade and chambers of commerce of principal ports, and influential newspapers. With the publication of such information as it has facilities for obtaining, this Bureau has exhausted its powers; but the hope is entertained that the facts adduced, the patent reasons for reform of State tax laws and, above all, the activity of shipping interests, may suffice to produce practical results at least in some of the States most directly concerned with navigation. 7325 NAV-IV


An unmistakable token of the quickened interest in navigation may be found in the projects of some of the larger ports, notably Philadelphia, Boston, and Cleveland, to appropriate considerable sums from their local treasuries for harbor improvements as an invitation to extended commerce. When a community begins to regard with favor a proposition to tax itself directly and with the full knowledge of taxpayers for the improvement of its harbor, there can be no question of the sincerity of its interest in commerce. Such projects stand on a very different plane from appeals to Congress for appropriations for rivers and harbors, and for evident reasons indieate a much more genuine, general, and profound appreciation of the direct benefits which come from a large shipping.

But natural barriers are not the only obstructions to trade, and taxes in their various forms can be as effective a block to navigation as bars or shoals. The Bureau has undertaken to obtain from collectors of customs and local authorities the various forms of charges on navigation at the seaports and lake ports of the United States, so far as fixed by State law or local ordinance. These charges are mainly under the heads of pilotage, quarantine, towage, wharfage, and harbormaster's fees. Besides these, at most ports numerous minor charges are fixed by private contract, and these are so fluctuating that no effort to state them officially could succeed or would long hold good.

These port charges, which are summed up in Appendix G, are for services rendered, and any comparison of them must rest on a precise knowledge of the extent and value of these services which, of course, this Bureau does not possess. The compilation is made in view of the possible service it may be to those concerned in navigation at our various seaports for comparison of the advantages or disadvantages in the matter of charges which the various ports offer. It is sug gested that in appropriations for harbors, Congress may with propriety consider whether the generosity of the nation is met in the same spirit by localities benefited, or whether heavy local charges are imposed on navigation which to an extent reduce the benefits of Federal appropriations, and to remove the necessity for which, in many instances, Congress votes money from the Federal Treasury.

The Bureau has recently obtained statements through the customary official channels of present local charges on shipping at many of the principal foreign ports. The statements are not as complete as desired, and time has been lacking to translate many. To keep this report within bounds, these statements are reserved for further consideration and compilation. The most noteworthy fact adduced is a general reduction or abolition of statutory charges on shipping at Copenhagen, amounting to a reduction of 80 per cent of former charges and making it virtually a free port with a view to meeting a threatened diversion of commerce through the North Sea and Baltic Canal to competing German Baltic and Elbe ports.


The last fiscal year was notable in American shipbuilding for the nature and progress of new construction, if not for its volume. Mere reference, in passing, to the Indiana, Minneapolis, Oregon, Ericsson, and

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