The New York herald., 1921-07-24
MOTOR CAR BIG ITEM
In FOREIGN TRADE
Would Benefit Under Pro-
posed Automobile
Duty.

The lower automobile duty in the pro-
posed new tariff bill will aid American
foreign trade, even though the act itself
may need revision In the way of excess
sive duties on raw materials. is the opin-
ion Of J. Walter Drake, chairman of the
foreign trade committee of the National
Automobile Chamber Of Commerce. Ex-
ports of motor vehicles and parts in 1920
headed the list of manufactured articles
with a valuation of $29s,21s.s75 ana
were exceeded only by raw cotton. wheat
and coal.
with present unsettled conditions in
the exchanges, it Is difficult to decide on
a dutiable basis which will be most
equitable to all nations Under the
American valuation system, an attempt
was made in that direction. It's disad-
vantage unfortunately lies In the ease
with which duties may be increased ar
bitrarily. United States manufacturers,
by enhancing the price Of their goods.
could establish higher American valu-
alton basis and consequently bring about
the collection Of q larger amount in
duty" says Mr.. Drake.
THE underlying object In proposing
tho American valuation probably was
to approximate the c. l. I. value, which
Is used mostly abroad as dutiable basis
but lends itself automatically to indirect
Determinations.
"In Jugo-Slavia, passenger cars are
dutiable at 48 per cent Of the C. l. T.
value at the custom. house in country
of destination. This means with regards
to American cars that the tax Is also
assessed on the cumulative charges for
boxing, rail freight In the United States.
overseas freight, lighterage and interest
on the money outlay. An American
medium priced car. because Of these
charges amounting to about $400, would
be assessed about 5000 more in duty
than q car originating in Italy or Gen.
tral Europe where these special charges
would be practically non-existent In
cidents OF this kind where the product Of
friendly nation Is assessed inequitably
beacuse OF the dutiable basis, would be
impossible under a system of American
valuations. 1t Is regrettable that this
advantage should be offset by the weak
feature referred to above.
"The American manufacturers as
group applied for q uniform duty Of
thirty per cent on imported automo-
biles as against the prevailing rate Of
forty-fve per cent. This united re-
quest is practically accorded by the
House Ways and Means Committee In
recommending the duty Of twenty-five
per cent on American valuation. which
would be the equivalent Of about thirty
per cent. II the dutiable basis In the
Underwood act were employed.
"a most commendable feature Is the
provision making the reduced rate APP
plicable to motor products from such
countries only as similarly favor Amer
lean exporters. Thus, the British and
French cars will be dutiable at twenty
five per cent. In the event only that
American motor vehicles are subject to
an identical duty when exported to
either Of those two countries. If. how
ever, the rate Is maintained as now at
thirty-three and one-third or forty-flve
per cent. respectively, then British or
French cars could be assessed as high as
fifty per cent. when imported into the
United States. ~
'"The European manufacturers ex-
pressed some time ago their, desire for
a uniform automobile duty in the prin-
cipal manufacturing countries. With
the above United States tariff provision
the attainment of that object Is possible
Immediately after the armistice. ar
rangements were made between certain
countries which worked to the disad-
vantage Of the American exporter or
automotive products. Czecho-S -Slovakia.
for illustration. permits the Importation.
without special permit Of italian motor
vehicles. On the other hand, imports Of
these commodities from the United
States are effectively obstructed because
Of the necessity Of complying with such
a governmental formality The contin-
uation of such practices, however, may
be expected to cease as President Har-
ding, under the Fordney tariff, Will be
authorized to assess additional duties
on products Of any kind from countries
discriminating against American trade.