The Birmingham age-herald., 1915-05-27
THE FIVE PER CENT" CLAUSE IF TARIFF LAW IS SUSTAINED.
Provision Grants Reductions on Goods Imported in American Ships May
 Have Profound Effect

Washington, May 28.--The sO-caIIed '5 per cent" clause in the tariff law. granting n reduction of duties to that amount on goods imported i'm American slips was sustained today by the cus- tom court. which held also that the 5 per cent rebate must he granted on all goods imported in ships of those coun- tries with which the United States has "fnvored nation. treaties.
 AS such treaties exist with the principal countries of the world the virtual effect of the decision is to reduce the customs rev enue by per cent.
 If the, decision is sustained by the supreme court of the United States ap- proximately $15.00O,000 in duties already collected must be refunded
 In dissenting opinion, Judge Devries pointed out that the majority decision means that goods imported in about 55G foreign vessels of favored nation coun- tries shall receive thls reduction in GUS toms duties. Five per cent of the esti. mated customs revenues for the present fiscal year would exceed $l1,OO0000 and in years to come this total would grow to even greater proportions. Moreover it was pointed out that the decision if fl stands the test in the supreme court. is retroactive in the extent that it ap- plies to importations into the United states since approval of the Underwood simmons law more than two years ago. including goods entered in bond and sub sequently withdrawn without payment of this rebate.
 Officials realize that the decision may rave profound effect upon the fiscal policy of the United States. At present the actual working balance in the treas ury is under $15.000.0O0 though possibly $40. .ooo0oo is available to be added to this if necessary.
 With an announced deficit in tne posyal revenues. and no increases in internal revenue or customs receipts in sight, talk of the necessity for an issue of Panama canal bonds was revived in view of the prospect of reduced customs revenues and the necessity of refunding millions already collected. The payment of some 0,0o0,0O0 into the treasury due from the Income tax, however. is counted on to delay any such emergency. for several months.
 Senator Oscar w. Underwood said last night that he would not attempt to. make an analysis of the decision of the court of customs appeals without seeing it's text He was inclined to think, however that the interpretation given the decision laid too much stress on the discrimina- tory favors that would accrue to foreign vessels under trade treaties.
 'T am glad the court has sustained the 5 per cent discrimination in favor of American bottoms," he said Tt will en- courage the American merchant marine if sustained by the supreme court, and that was our purpose in inserting the clause in the tariff law"
 | Today's decision in the customs court In part sustained the ruling of the board of general appraisers and in pal t| reversed that body. In addition to it's findings regarding goods from abroad. the court held that merchandise from Cuba is entitled to reduction of .1 per cent ad valorem al provided by the Cuban preferential treaty with the United States and to the further dis count of s per cent from that amount
 Parties to Suit
 The government importers and American and foreign ship owners were pareies 10 the suit The government
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