New-York tribune., 1886-01-21
better for the employers than strikes or waste
full struggles.
THE TONNAGE TAX.

THE TONNAGE TAX.
On the surface. Mr.. Phelps's resolution APP
pears to be joke, though with sharp edge.
The House solennly inquiries what 1t has DONE
OF has failed to do by an act passed TWO years
ago. The State Department, if in candid moou,
might reply that it would very much ike 10
know. But the question is a serious one, OF
inheritance to American interests, and one 10
which Congress should find definite and
speedv answer. The fourteenth section OF the
Shining Act, approved June 26, 1884, pro-
v,des u) The tonnage tax shall be reduced
from 30 cents per ton to cents per ton not
exceeding ls cents yearly, on all vessels from
foreign ports in Northern or Central America
the adjacent islands OF the Sandwich Islands;
(2) That on vessels entering from any port OF
the countries above described all OF this tax
NAV be abated by the President which may
be found in excess of the tax levied on Ameri-
can tonnage entering at the same port; (3) The
tax on vessels from all other ports shall be
reduced from 80 cents to cents per ton, not to
ex iced 30 cents yearly. Evidently tho effect
of these provisions is to abolish the entire tax
on vessels entering from American ports where
no tax is laid on United States shipping.
This clause of the law ignored and was ap-
parently made in forgetiulness of ancient
treaties, by which the United States was bound
to impose on shipping from different European
nations no heavier tax than it imposed on ship
ping from tho most favored nations. Under
this stipulation, rs tho President stated In his
Message. Germany. Belgium, Denmark, Portu-
gal. Sweden and Norway have claimed that
their ships should he admitted free OF tax, since
at their ports no tax is levied on vessels from
the United States. This was clearly not the
intention of the law, and yet the law must he
construed in harmony with the pre-cxistng
treaties. If by mistake Congress has granted
privilege to shipping from American countries
which, under formal treaties, it is bound TO
grant equally to shipping from other countries,
it will probably be found the only sensible way
out of the difficulty TO abolish the tonnage tax
altogether, except as TO ships from ports at
which American shipping is taxed.
In attempting to answer TIE claim OF
Portugal. Secretaries Bayard and Manning
have made a curious muddle of the matter,
holding that tho privilege granted to American
countries is partly national and partly geo
graphical, and that under the treaty similar
privilege might he extended to Portuguese
vessels sailing directly from ports OF Portugal
to this country, but net TO such vessels II from
other ports where the exemption does not
Apply. The difficulty OF enforcing such dis
tinction is apparent When it is considered
that other nations having "most favored
nation treaty with the United States can claim
at least as much rs Portugal and that Sweden,
having a peculiarly explicit treaty. can prob
ably claim even more, it will be seen that the
Senate was right in trying to substitute broad
repeal of all tonnage taxes on shipping from
nations which impose no tax on American
ships. That course would be in harmony with
the policy of the Government from 1880 to
1861, under which the shipping interest of the
country grew as it has never grown at any
other period
The tonnage tax is an excrescence Imposed
under the necessities OF war, and never meant
to outlast that struggle it yields TO the Gov
ernment an Insignificant revenue. Secretary
McCulloch in January, 1885, said that it did
not appear very elevated National policy To
collect about $50, 900 from our own vessels in
order to collect little over 100000 from
foreign vessels. The tax, though small often
interferes fatally with the profits of vessels
which might obtain cargoes to our ports, and
operates to the disadvantage of our shipping IN
every way. Congress will find it much easier
to discover what it ought TO do than to discover
what it has done Probably it will not learn,
even after inquiry and diplomatic correspond
ence for years, exactly how far it has already
abolished the tonnage tax. Bat it can see, one
would think, that the entire abolition of the
tax on shipping from ports where American
shipping is not taxed has become a measure of
obvious wisdom.