New-York tribune., 1920-09-14
Marine Act Is
Already Giving
Aid to Shipping g
Profits Tax Exemption to
Enable U. S. Shipowners
TO Meet Competition of
Other Maritime Nations
Shipbuilders Also Aided
Many Vessels Announced To
Reconstructed; Extensive
Annual Saving Effected

~Xne moSt tfSe12I uaIl0n2l encourage
msne which any government has ever
given toward the increase of the cargo
Carrying tonnage OF merchant ma
r;nes Is the description given by the
American Steamship Owners Associa-
ton to the provisions of the new ship
ming act exempting excess profits taxes
il they are invested In the construc-
lion Of new tonnage.
Many companies have already taken
advantage Of the terms of the act in
this connection, and it is expected that
numerous other applications will be
made.
According to the terms of Section %
Of the act all American vessels en-
gagged in foreign trade are exempted
from all Federal excess profits taxes
on the condition that the amount of
the exemption 'be invested OR set aside
under rules and regulations to be made
by the Shipping Board in trust fund
for investment in the building in ship
yards in the United States of new
vessels Of a type and kind approved
by the board; provided further that at
least two-thirds of the cost of any
vessel constructed under this para
graph shall be paid for out Of the
ordinary funds or capital of the per-
son having such vessel constructed"
Shipping Board Is Acting
The Shipping Board, it is stated, has
moved promptly to put Section % into
practical effect. Officials Of the In
ternal Revenue Bureau, which is coop
Grating with the Shipping Board in
framing the essential regulations to
been in conference with the executive
committee of the American Steamship
Owners Association.
In substance it is pointed out what
the new plan means is that American
ship owners who have tonnage earning
excess profits in foreign voyages will
be aided in the building of new tom
mage by an allowance Of 81 for every
So Of private capital 80 invested.
This, in effect, would be, for example,
an allowance of $500000 in the case Of
Q cargo steamer of 10000 tons dead
weight, assuming that such ship would
cost $500 900 at the present time.
In addition to the encouragement
given toward the increase of American
shipping the plan will also furnish q
powerful aid toward the maintenance
Of the ships built under its benefits.
Substantial Annual Saving
Assuming that the $5ooooo allow
anee from the government on a 10000
ton ship will reduce the cost of the
ship to that amount to the shipowner,
the annual saving in the charges on the
invested capital would be as follows:
Insurance at per cent. $4,000
Depreciation at per cent $4,000
lnteres. on investment, per
cent .................. rs 900
government allowance of S500,000 to
the owners of a 10,o00-ton vessel would
be at the rate of S65 900 a year. This,
it is pointed out, would put the Ameri-
can ship in a very advantageous posi-
tien in competition with foreign ships
whose owners are required to pay ex-
cess profits taxes to their governments.
Mary Tankers To Be Built
Among the ships which it has already
been arranged to- build under Section
% OF Inc merchant marine act are four
teen tankers for Standard Oil interests,
which will be constructed at the ship
yards Of the Federal Shipbuilding Com
pany. Kearny, n. j.; the Moore Ship
building Company, Oakland, Calif.; the
Sun Shipbuilding Company, Chester,
Pa; the Newport News Shipbuilding
Company. Newport News, Va; the G.
n. Standifer Construction Corporation,
Vancouver, Wash. and the Oscar DAN
iels Company, Tampa, Fla.
Other tankers to be built include one
BY the Moore Shipbuilding Company
for the Vacuum Oil Company, one by
the New York Shipbuilding Corpora
ton, Camden. y. j., for the Pacific
Mail Steamship Company, and onother
BY the Sun shipbuilding Company for
the Sun Company.
shipyards, as we'll as shipowners
will thus benefit materially from the
operation o? the plan.