Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-08-07
N. WHITES OBJECT
To Settle Russian Sugar
Tariff difficulties.
COMPRESSION AL ACTION
WILL PROBABLY BE NECESSARY
TO EFFECT IT.
United State Supreme Court Has De-
cided That Sugar in Russia
is Bounty-Fed.

Congressional action will probably be nec-
essary TO carry out the object which NJ de
Witte Is said to have In view on the oeca-
sion of his. contemplated visit to Washing
ton in connection with Russian tarin af-
airs. AS stated In The Star a few days
ago, NJ. de Witte is to take up with the
administration, in the course of his trim -
America. the tariff matters that have been
Irritating the United States and Russian
governments for some time.
The only stumbling block in the way Of
speedy and easy settlement OF existing
tariff difficulties Is the question of counter
vsiling duty imposed by this country On
sugar imported from Russia which duty
was imposed because the sugar was
bounty-fed by the Russian government
Russia has claimed all along that 1t was
not bounty-fed and desires this country to
admit that claim. Inasmuch as the United
States Supreme Court has decided that the
Russian sugar is bounty-fed, government
officials here do not see how any agree
ment can be reached with NJ. de Witte for
amelioration of the: tariff, under existing
conditions.
Cannot Comply Under Existing Law.
Recent intimations from ST. Petersburg
are to the effect that Russia is willing to
revoke all her vexatious tariff regulations
against the United States If this govern
ment will abate its attitude on the sugar
question. The United States Is anxious to
have these difficulties in the way of trade
with Russia removed, but the Russian de-
mand as to sugar may be found unreasona-
BILE, at least impossible of compliance
In the face of existing law
The question has been raised In some
quarters whether the interpella ton OF Rus
sian-American tariff difficulties at this mo-
hne L.r Il
peace negotiations. In other words do the
Russians hope to secure the moral sup
port Of the United States at a critical
juncture by making overtures of recon-
ciliation tariff differences. This is an
ungracious suppostion. it is said in official
circles. 1t is quite proper that NJ de Witte,
who was minister Of finance when the ques-
ton OF retaliatory duties first arose. should
now take up with this government meas
ires looking to the dissipation of all diff
eulties.
The limitations however are quite dis
tihct. Congress, in the Dingley act, in sec
ton 5, provided that where country paid
a bounty on sugar an equivalent tariff
duty should be levied by the United States.
In conformity with that act. this govern
ment made ruling February IA, 1901, N)
plying specific rates of duties on Russian
sugar. A cargo of sugar was brought to
Baltimore and duty was assessed, where
upon the case was carried into the courts.
the claim being that under the peculiar
Russian law no bounty was being paid.
1t was a delicate question The supreme
court found that Russia laid an excise tax
on sugar for domestic use and put no tax
on sugar for export.
Argument for the Government.
The argument of the government the
case being Downs agt. United States, was
as follows:
THE single question involved Is whether
a bounty was bestowed by Russia on the
exportaton Of the sugar. The point of tu-
risdiction which might be urged In favor Of
exclusive executive authority to determine
the question appears to have been waived
by the Secretary Of the Treasury having
voluntarily submitted the matter to the 1u-
dicial determination of the board Of general
appraisers and the courts. The only other
case under the law Is Hills VS.. United
States, which decided that the practical ef-
feet of the Dutch law is to make the remis
sion of the excise tax from the standpoint
of other countries bounty on expectation.
THE Russian government desires to
maintain prices, and therefore linits the
output on the domestic market. 1t also de-
sires to stimulate production. and for this
purpose puts a premium on eXportation.
1t Is neither necessary nor proper to sug-
gest a covert purpose to bestow a bounty
by seeking a covert method; but the Rus
sian attitude offers some excuse for such
suggestion. 1t Is enough to establish that
the premium on expectation, the indirect
bounty, is the necessary effect and result of
the scheme.
1.-The grant as governmental allowance
is shown by the complete control of the
government over 1t. The government re-
serves the right to suspend the remission
Of excise in order to guard against the ef-
feet OF such rise of prices in the rest of
Europe might cause an abnormal do
mestic overproduction. One highly signif-
icant feature in the arrangement is the ces-
sion or transfer of free sugar from one
mill to another in order to facilitate ex-
portation, which transfer carries a consd
market right and constitutes the concrete
evidence Of the premium or indirect bounty
on exportatiO
This court does not accept a foreign
remission Of internal tax as conclusive
upon Its effect with respect TO our own
laws. The Russian scheme carried out
under their sugar law and regulat atoms clear
ly amounts to the paying or bestowing in
directly of a bounty or grant upon the ex-
portation of sugar which properly subjects
the merchandise upon importation into this
country to the counteryailing duty pre-
sented by section of the tariff act of
1897"
Supreme Court Decision,
The Supreme Court unanimously decided
that Russia paid a bounty and that the
tariff law must apply. Officials are now
wondering how the issue can be avoided
One suggestion is that another case be
raised and perhaps a contrary decision
reached by the Supreme Court, which will
prohibit the applicable of the tariff law.
The approaching visit of w. de Witte and
his representations to this government will
be watched with considerable interest in
both congressional and official circles