Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-08-25
Rates and Not System
Seen Tariff Problem
BY HARDEN COLFAX.

Should Congress enact the new tariff
bill with the value amendment as pro-
posed by the Republican majority OF
the Senate finance committee. lad val
orem" will become a term much better
understand by the non-technical and,
at present, unexcited citizen than now
is the case.
While final adoption of the proposed
amendment, which looks toward a
fundamental change in the basis of as
sessing customs duties which depend
upon the value Of the imported article,
would afford opportunity for continued
tariff discussion until the conversion
was accomplished, there is a widespread
feeling, irrespective Of partisan Views.
that it would be wise to have a system
which could be controlled entirely
within the boundaries Of the United
States. The ensuing fight would be a
renewal of differences over rates, more
than varying views as to the system.
Under the present tariff act. and
throughout the history of this republic,
except in its earliest years. ad valorem
rates of customs duty have been based
on the foreign value Of the imported
commodity: that is. the price at which
it is offered for sale in wholesale guam
titles and in the ordinary course OF
business, ready for shipment, In the
country Of expectation. There are four
alternatives under existing law: Ex-
port value, United States value. cost of
production and American selling price.
Many years ago experience demon
strated 1t was necessary to have check
against declared foreign values, and for
this purpose Treasury agents were sent
abroad to principal countries TO keep
abreast with wholesale prices there.
Every year these agents have detected
fraudulent undervaluations which no.
only cheat Uncle Sam out Of revenue,
but create conditions of unfair compe-
tition between merchants here who had
paid honest duties on their foreign
goods and those who were beneflciarieS
Of customs frauds.
In recent years, particularly in the
last half dozen years, some foreign
countries, notably France, have OBJ
jected to the operations Of the United
States Treasury agents within their
borders, and many Of them have been
withdrawn because of this friction.
Without impugning the good faith or
States Government has been reluctant
to permit individual foreign nationals
to fix the duty 1t should collect under
its tariff law, which would be the eff
feet Of accepting declared entry values
of foreign goods without some check Of
their accuracy.
Essentially, the tariff is q domestic
affair. Repetitions may be made by
foreign governments with propriety,
however, and there have been many
submitted the State Department during
the months Congress has been consider
ing tariff revision, and this Nation has
made representations for its citizens to
foreign governments in regard to their
tariffs and regulations.
Few other nations base their Gus
toms duties on foreign value in whole
sale quantities as does the United
States. Most of those which do follow
this fundamental system impose addi-
tions to the foreign selling price before
calculating duty.
Am ng those which control the value
basis within their own borders, with
variations in the plan of operation,
are: Argentina, Brazil, French Guinea,
Uruguay. Belgium, Czechoslovakia, Den
mark, Finland, France, Austria, Greece,
Italy, Latvia, Lituania, the Neither
lands. Norway, Sweden, Australia, the
United Kingdom, China, Japan, Egypt,
Persia, Siam and others. Canada's sys-
tenn Is much like that Of the United
States, as are the plans Of Cuba, Mex
leo and O majority of the Latin Ameri-
can republics. Germany, Switzerland
and a few other nations have no ad
valorem duties, using the specific basis
only.
Something near half Of the rates in
the United States tariff are on an nd
valorem basis, the others being specific,
which Is dxed amount per unit Of
measurement, such a. = cents Der