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ing shipping from an exacting home port to a port in another State more farsighted and liberal in its tax policy. These taxes are unfair, for, from the nature of the vessel, it can enjoy only to a slight extent the benefits of those public undertakings to which, in the main, the proceeds of State and local taxes are devoted. In the last annual report of the Bureau a comparative table of the taxes paid by American and foreign shipping as property was published, which is hoped to have been not without effect in promoting the legislation of the year, and, as the legislatures of some States were not in session during 1895, it is reprinted in Appendix K of this report.

The most liberal law of the year was enacted by the legislature of Minnesota, providing for an annual tax of 3 cents per net ton on all vessels of the State navigating international waters, in lieu of all other State and local taxes. This rate of taxation brings Minnesota abreast of New York, Alabama, Delaware, and Pennsylvania, which exempt American vessels in foreign trade from all State and local taxes, abreast of Massachusetts and Connecticut, which tax only the incomes of American vessels engaged in foreign trade, and in advance of Great Britain and Germany, which tax only the income of shipping, but at a rate which produces a tax compared with tonnage or valuation higher than that imposed by the new Minnesota law. Under the former law of the State, shipping at Duluth last year, 2,735 gross tons, paid $3,763 in State and local taxes, or fully $1.50 per net ton. Large transfers of vessel property to Duluth are now under way.

Great Britain and Germany are to-day and for the future are destined to be our opponents in any effort the United States may make to obtain a becoming share in the ocean carrying trade. Those who make the laws for our seaboard States may with advantage, then, imitate the liberality shown toward shipping by those nations. The Cunard Steamship Company, according to its latest annual report, paid an income. tax to the British Government last year of $11,304. Its fleet of 112,124 gross tons is valued on the company's books at $7,927,853. The tax paid was thus the equivalent of a tax of 10 cents per ton, or on each $1,000 of valuation the company paid $1.42 taxes, about one-seventh of 1 per cent. The report of the North German Lloyd Company is even more significant. Its income tax was $11,931, while its fleet of 211,941 tons is valued at $16,395,600. The tax was thus equivalent to a tax of 5.6 cents per ton, or of 72 cents on each $1,000 of valuation, about one-fourteenth of 1 per cent. The conversion of an income tax into terms of a tax per ton or per $1,000 of valuation is not employed as a scientific method of comparison but as the only one available. The tax varies, of course, with the income, which varies with the business of the corporation or the year.

The following table, based on this year's reports of the companies named, is fairly illustrative of the taxes paid by the British and German shipping with which we compete:

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It is not deemed necessary to compare these figures with the taxes laid on American vessels as property at our principal ports for the current year, but it is suggested that in any locality the local taxes, tonnage, and assessed valuation of shipping taxed can readily be ascertained and the comparison made by those directly concerned.

The new law enacted this year by the Maine legislature fixes the valuation of shipping for taxation at $20 per gross ton for new vessels, with a reduction of $1 each year of a vessel's life. As the rate of taxation at Maine seaports is about 2 per cent, the new law imposes a tax of 40 cents per ton, reduced by 2 cents each year of a vessel's life. While this rate is very high compared with the rates noted above, the act undoubtedly is not only a considerable measure of relief to Maine shipowners, but a step, though not a long one, toward the creation of new conditions under which the United States can again compete for the foreign carrying trade. Clearly no such competition was possible. for that State when taxation bore such a relation to value as that indicated by the following comparison of the assessed value and selling price of certain vessels from the records of Bath, Me., in February of the current year before the new act was passed:

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The new act of Wisconsin fixes an assessed valuation, with reductions for age, ranging from $15 per net ton for new steel steamers to $7 per net ton for wooden sailing vessels. While this valuation is understood to be less than that formerly fixed in the State and is less than half the valuation recently adopted by Maine, the taxes imposed under it will be greatly in excess of those imposed under the new law of the adjacent State of Minnesota. It is not difficult to conjecture which port, Duluth, Minn., or Superior, Wis., the owner of a steel steamer of 2,000 net tons will select as the port of actual or nominal ownership and taxation. Under the Minnesota law the vessel would be taxed $60, under the Wisconsin law from $550 to $650 annually, according to the current tax rate. The certain effect of the lower tax law is, first, to attract shipowners, and second, to obtain a slight revenue, while the effect of the higher tax law as surely must be to expel shipowners and lose revenue. The new tax laws of Maine, Michigan, Minnesota, and Wisconsin are printed in Appendix K.

The handicap which some of the States, through heavy taxes, have put upon American competition for the oversea carrying trade, and the great inequality in the methods of taxation adopted by the States, led years ago to the advocacy of the regulation by Congress of the taxation of vessels in foreign and interstate commerce. The opinion was ventured in this report last year 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 is a type." This opinion is confirmed by the success which has attended appeals to State legislatures during the year and by an opinion which the Solicitor of the Treasury has furnished as to the probable unconstitutionality of an act of Congress exempting American vessels in foreign trade from taxation for State and local purposes. That opinion may be found in Appendix K. It is noted that the Supreme Court of the United States (Moran v. New Orleans, 112 U. S., 69) says:

And it is undoubtedly true, as it has often been judicially declared, that vessels engaged in foreign and interstate commerce, and duly enrolled and licensed under the acts of Congress, may be taxed by State authority as property; provided the tax be not a tonnage duty, is levied only at the port of registry, and is valued as other property in the State, without unfavorable discrimination on account of its employment.

And again (Transportation Company v. Wheeling):

By authority (of Gibbons v. Ogden, opinion by Chief Justice Marshall) it is settled that the power to tax and the power to regulate and prohibit taxation are given in the Constitution by separate clauses, and that those powers are altogether separate and distinct from the power to regulate commerce, from which it follows, as a necessary consequence, that the enrollment of a ship or vessel does not exempt the owner of the same from taxation for his interest in the ship or vessel as property upon a valuation of the same, as in the case of other property.

These decisions appear to show that should Congress pass an act exempting American vessels in foreign trade from taxation as property for State and local purposes the courts would declare it an unconstitu tional curtailment of the rights of the State. But even if, in view of other decisions of the courts, there may remain doubt as to the probable constitutionality of the act suggested, that doubt, coupled with other obstacles such a measure would probably encounter in Congress, would be sufficient to prevent its passage. Efforts to secure Congressional action upon this subject, it is believed, are a misapplication and waste of energies, which directed toward State legislatures have already effected desirable results and are capable of effecting more such results.

Such efforts as Congress and the energy and capital of our citizens may put forth to restore American participation in the ocean-carrying trade would be greatly assisted if the maritime States should each adopt the law to which New York State may, in part at least, attribute its present maritime supremacy. That law, enacted first for fifteen years in 1881, and again enacted for thirty years in 1892, provides:

SECTION 1. All vessels registered at any port in this State and owned by any American citizen or association, or by any corporation incorporated under the laws of the State of New York, engaged in ocean commerce between any port in the United States and any foreign port, are exempted from all taxation in this State for State and local purposes; and all such corporations, all of whose vessels are employed between foreign ports and ports in the United States, are exempted from all taxation in this State for State and local purposes upon their capital stock, franchises, and earnings for the period of thirty years.


The repeal of sections 4589 and 4590 of the Revised Statutes is recommended. These sections are part of the act of May 28, 1796, and relate to the obsolete practice of the impressment of American seamen by foreign powers. For over seventy years these laws have served no other purpose than to require from the master of every American vessel at every entry from a foreign port a superfluous and meaningless oath. The form of the master's oath now required is as follows:

I further swear that no part of the crew of the said vessel has been impressed or detained in the course of the last voyage by any foreign power.

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The attempt of foreign powers, notably Great Britain, to impress American seamen was checked by the war of 1812 and by changes in the practices of maritime nations which resulted from it, if not directly involved in the treaty stipulations which followed. This Bureau has not deemed it worth while to ascertain the date when the last American seaman was forcibly impressed by a foreign power and removed from an American vessel on the high seas, but it was in all likelihood beyond the memory and probably before the birth of any Member of Congress, or any officer of the Government, or of any present master of an American vessel. Yet the laws and the regulations based on the laws for very many years have required the masters of American vessels at each entry from a foreign port under penalty of $100 "to declare on oath whether any of the crew of the vessel under his command have been impressed or detained in the course of his voyage." The oath prescribed in section 4590 and the report to a consul prescribed in section 4589 have become useless.

The impressment of an American seaman at the present time by any foreign power is too remote a contingency to be provided for in a body of practical laws. Should it be undertaken, word of the affront to the nation would reach the United States long in advance of the report prescribed by the statute, and the action of the Government would not in any way be assisted by this law. It is believed that there can be no objection to the repeal of laws which have no usefulness and survive to the inconvenience of American masters and customs officers. The survival of such useless laws and penalties tends to bring law itself into contempt or to create among navigators an impression of legislative indifference to their calling.

The sections of the Revised Statutes in point, 4589 and 4590, read thus:

SEC. 4589. The master of every vessel of the United States, any of the crew whereof shall have been impressed or detained by any foreign power, shall, at the first port at which such vessel arrives, if such impressment or detention happened on the high seas, or if the same happened within any foreign port, then in the port in which the same happened, immediately make a protest, stating the manner of such impressment or detention, by whom made, together with the name and place of residence of the person impressed or detained; distinguishing also whether he was an American citizen; and, if not, to what nation he belonged. Such master shall also transmit by post, or otherwise, every such protest made in a foreign country, to the nearest consul or agent, or to the minister of the United States resident in such country, if any such there be; preserving a duplicate of such protest, to be by him sent immediately after his arrival within the United States to the Secretary of State, together with information to whom the original protest was transmitted. In case such protest shall be made within the United States, or in any foreign country, in which no consul, agent, or minister of the United States resides, the same shall, as soon thereafter as practicable, be transmitted by such master, by post or otherwise, to the Secretary of State.

SEC. 4590. The collectors of the districts of the United States shall, from time to time, make known the provisions of the two preceding sections to all masters of vessels of the United States entering or clearing at their several offices. The master of every such vessel shall, before he is admitted to an entry by any such collector, be required to declare on oath whether any of the crew of the vessel under his command have been impressed or detained, in the course of his voyage, and how far he has complied with the directions of the preceding section. Every master who willfully neglects or refuses to make the declarations herein required, or to perform the duties enjoined by the preceding section, shall be liable to a penalty of one hundred dollars. The collectors shall prosecute for any forfeiture that may be incurred under this section.

Section 4588, referred to in section 4590, provides a method for the naturalization of seamen. It is not necessary that collectors of customs, as required in section 4590, should make known to the masters of vessels the provisions of section 4588. To be the master of an

American vessel one must already be an American citizen, and the intelligent among foreign-born sailors on American merchant vessels know that American citizenship is a necessary qualification of an officer of an American merchant vessel.

The repeal of sections 4589 and 4590 is embodied in section 15, bill L, found under the head "Proposed legislation."

By changes in the direction of trade and in the construction of vessels and by the increase of custom-houses and changes in the laws concerning navigation and transportation, various provisions of the Revised Statutes, useful in their day, have become virtually obsolete. The repeal of such sections is desirable in order that the laws relating to navigation may be as compact and intelligible as possible. The interests and convenience of commerce suggest that at some time the navigation laws should be codified, and the repeal of statutes, which from various causes have lost their vitality, is a necessary preliminary to that work as well as intrinsically proper.

Sections 4306 and 4307 require every vessel of the United States going to a foreign country to carry a passport under penalty of $200 fine for each offense. The law was enacted in 1796, and has been a dead letter for many years. Its purpose was to afford American vessels protection in the Mediterranean against the Algerines and pirates of the Barbary States. An effort of this Bureau to obtain one of these passports to supply the Naval War College with a complete set of the marine documents prescribed by the laws of the United States succeeded only in developing the fact that a few passports, with their quaint, curved line, are preserved as curiosities in the State Department. They are not known to modern commerce. It is suggested that the repeal of sections 4306 and 4307 is desirable, and it is provided for in section 15 of bill L, under the head "Proposed legislation."

The repeal of sections 4133 and 4134 of the Revised Statutes is recommended. Section 4133 is part of the act of December 31, 1792, and section 4134 was enacted March 27, 1804. The sections read:

SEC. 4133. No vessel shall be entitled to be registered, or, if registered, to the benefits of registry, if owned, in whole or in part by any citizen of the United States who usually resides in a foreign country, during the continuance of such residence, unless such citizen be a consul of the United States, or an agent for and a partner in some house of trade or copartnership, consisting of citizens of the United States actually carrying on trade within the United States.

SEC. 4134. No vessel shall be entitled to be registered as a vessel of the United States, or, if registered, to the benefits of registry, if owned in whole or in part by any person naturalized in the United States, and residing for more than one year in the country from which he originated, or for more than two years in any foreign country, unless such person be a consul or other public agent of the United States. Nothing contained in this section shall be construed to prevent the registering anew of any vessel before registered, in case of a sale thereof in good faith to any citizen resident in the United States; but satisfactory proof of the citizenship of the person on whose account a vessel may be purchased shall be exhibited to the collector, before a new register shall be granted for such vessel.

The political conditions which many years ago led to the enactment of these laws have entirely passed away, but the laws survive as an obstacle to the ownership of American vessels and to the extension of our foreign trade under the American flag. Section 4133 was taken by our early lawmakers almost verbatim from chapter 60 of the acts of Parliament of the twenty-sixth year of the reign of George III (1786). That act, it may be noted in passing, was the model after which the earliest Congresses of the United States framed our legislation concerning navigation, and though Great Britain long ago repealed the restrictive features of that act, our own country, in most matters the

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