Iowa County democrat. [volume] (Mineral Point, Wis.) 1877-1938, 1893-05-19
SPECIFIC DUTIES.
THEY SERVE THE PURPOSE OF DIS
HONEST IMPORTERS.

HEY SERVE HE PURPOSE OF DIS
HONEST IMPORTERS.
The Charge That Ad Valorem Duties Are
More Favorable to Fraud Is Disproved
by History-Why the Poor Pay Dispro-
portionate Share of the Taxes.
The manufacturers and importers, as q
rule, prefer specific to ad valorem duties
manufacturers because q certain duty
per yard or pound increases the rate of
protection as prices decline from the in
PRODUCTION of better machinery; import
ers because specific duties tend to steady
prices. Both of these reasons (they are
only one) are arguments against specific
duties. Whatever may be in the inter-
ests Of manufacturers and importers, the
people at large want prices to decline
here when they do abroad. That is why
they voted for tariff reform.
But importers make another claim
against ad valorem duties which if true
is deserving of some consideration. They
say that there is more differentiation
and fraud when duties are levied accord
ing to value and not by piece or measure
They claim that dishonest importers who
will juggle figures, distort facts and
bride customs officials will have an adj
vantage under ad valorem duties over
the honest importer.
That both kinds of duties lead to fraud
is evident to all who understand them
and human nature. That more fraud is
perpetrated under ad valorem duties is
disproved by history and facts. Henry
Clay, who strongly favored ad valorem
duties and who produced arguments en-
tirely overlooked by his Republican sue
cessors and worshipers, said in 1912:
''What has been the fact from the ORR
gin of the government until now? The
articles from which the greatest amount
of revenue has been drawn, such as wool
ems, linens, silks, cottons, worsteds and a
few others, have all been taxed On the ad
valorem principle, and there has been no
difficulty in the operation. l believe,
upon the whole, that it is the best mode.
l believe that if we adopt a fixed rate ad
valorem wherever it can be done the rev.
enue will be subjected to fewer frauds
than the injustice and frauds incident to
specific duties"
Facts since 1912 have not reversed
Clay's argument.
The Hon. John Dewitt Warner says in
American Industries:
''Take the treasury cases and go over
them, and one at once sees that it is not
in reference to ad valorem duties that
the inspectors are occupied in our court
docl1ets, filled with Investigations of
schemes to defraud the government, but
that it is in the cases which arise under
specific duties that this trouble arises.
A minor but important consideration is
this-to watch for and detect the COM
paratively ordinary methods of evasion
by differentiation in an ad valorem sys-
tenn. Government officials of fair abil-
ity and reasonable experience-such as
are secured by the salaries that our gov
eminent can pay-are competent. But,
on the other hand, to track and unearth
the frauds perpetrated under the specific
system requires the service of brains
combined with means and experience"
Mr.. Warner even comes to the conclu-
sion that in many cases where specific
duties have been tackled onto ad valorem
ones it has been done not to promote
honesty, but "by deliberate manipula-
tons of the tariff schedules, in order to
facilitate this, that or the other fraud
upon the revenue" Undoubtedly many
if not most importers who advocate spe-
cifc duties have in view some particular
device by which they expect to enrich
at the expense of the govern
ment and of the people, for the consumer
pays thesam price for struggled or part
ly smuggled goods as for those on which
legal duties have been paid. Mr.. Warner
illustrates many ways in which specific
duties serve the purpose of dishonest i'm
porters and compel poor people, who use
lower priced articles, to pay dispropor-
tionate share of taxes, but he cites no
case more fagrantly unjust than the fol-
lowing from The Dry Goods Economist
IF April 81, an organ of manufacturers
and importers, which advocates specific
1uties first, last and always. 1t occurs
n letter from special correspondent !
n Chemnitz, Germany, who has decided |
opinions of his own. In fact, he almost |
'eads the riot act to his employers:
"Any graduated or classified schedule |
IF duties opens and paves the way for
he grossest frauds. Such tariff is not
n the interest of any one except the dis
lonest importer or foreign manufacturer.
t drives honest dealers out of the market
md defrauds the government of much
evenue.
LET us see how the hosiery schedule
# the Mckinley tariff has worked: A
dishonest buyer comes to Chemnitz and
purchases hosiery of a not overscrupu-
Gus house, say l 600 dozen of 81 grade
nd 1000 dozen at 81 30, both lots being
n the second classification, and payinga
Iuty of so cents per dozen and 80 per