The Washington herald., 1913-08-18
DIAMOND IMPORTERS
ARE OPPOSING DUTY
Increased Rate in Underwood Bill De-
ciared to Put a Premium
Upon Smuggling.
M'ADOO SEEMS AGAINSTIT

| Diamond importers, cutters, and deal
| ers all over the United States are up in
arms against the increase in duty pro-
posed by the Underwood bill. which they
say would put premium on smuggling
and disastrously affect the legitimate in
dustry.
Through the efforts of a committee
headed by Ludwig Nissen. Of New York.
with Felix II. Levy as counsel, it has
! been impressed on Congressional lead
! ers that the officials of the Customs
Service believe duty higher than the
present one would be uncollectable-
! As early as May 80 Secretary of the
Treasury McAdoo advised Senator Smith
! of Georgia that opinion in the Customs
Service WAS that tine present duty of 10
per cent on cut and finished goods was
as high as could be successfully levied
| and collected on diamonds and precious
stones. Writing again TO Senator Hughes
of New Jersey on June q, Secretary Nc
AdOo said:
| Il deem it my duty to cali the atten-
ton of the Finance Committee of the
Senate once again 10 the probable large
increase iE smuggling which would occur
should the rate be raised to % per cent
ad valorem AS / stated in my earlier
letter. a large majority OF the officers
and employees of the Customs Service
who have come in contact with this sit
uation is strongly of the opinion that
duty at a higher rate than 10 per cent
is practically uncollectable.
| The opinion of the Assistant SeCre-
tary in charge OF customs and of the i'm
.portant heads of the Customs Service
lis that increased smuggling would re-
suit from the imposition of the ~ per
cent rate and that it would be not only
detrimental to the government from 4
inf al
have a harmful effect upon the honest
importers of diamonds and precious
stones.
| Mr.. Nissen. who has just returned from
Europe said in New York yesterday that
before going abroad he had presented the
entire matter TO the Ways and Means
Committee of the House and the Finance
lCommittee of the Senate. but no change
had yet been made in the bill. Efforts
will be vigorously pressed, however. to
have the existing rates restored in the
bill before its passage by the Senate.
We stand practically in unique
POSITION in asking not to have the duties
upon our importations raised. Almost
every other interest Is importuning Con-
gress to make or leave the duties as high
as possible. The proposed bill, as passed
by the House, recommends 10 per cent
on rough and % per cent on cut goods.
The ordinary quality of cut diamonds
comes TO a value OF S300,Up0 a pound.
Pearls, OF which America consumes a
great many at the present time. when
| of larger sizes and fine quality, Will
come as high as s2,5oo01O pound. In
other words it is easily possible for
any one person TO carry 100000 or
more worth of Our goods in his pockets
without attracting the slightest atten-
ton. The smuggling OF our articles is
r1.a aRfG fas
entry into the United States, where a
more or less rigid examination may be
made. but it is done over the borders
, of Mexico and Canada, where practi-
| cally no examinations are made
In a memorial prepared by Mr.. Ms
sens committee and signed by hundreds
of diamond men. il is pointed out that:
There are but five departments CT
the government directly charged with
supervision over the importation oil
| precious stones. The impossibility o:
preventing smuggling of gems, of which
an ounce or two in weight often repre-
sents a value of 100000 and more, has
caused the heads of every one of these
| departments, not merely voicing Their
individual opinions, but expressing like
wise the views of the large force of mer
under them who have acquired knowk
edge on the subject from years of ac-
tual experience, to declare that more than
10 per cent duty is not collectible, and
that every ! per centum added to that
amount will increase smuggling and de-
crease the revenue obtainable therefronl.
Dealers in Canada, alive to impend-
ing possibilities, have recently erected
signs along the frontier making a bid
for illegal traffic in precious stones, which
commonsense and experience have shown
. is impossible of detection and prevention,
: with upward of 5000 miles of unguarded
border line across which to operate. A
Z typical sign near Toronto reads: 'Dia-
r monds enter Canada duty free and the
suggestion is obvious"