Evening star., 1949-07-31

Ia the WlSQOIQ Oh WASllLls COA OA
and otherwise restrict the supplies
necessity like sugar, most Of which
We must import from the Philip
pines, Hawaii, Puerto Rico. Cuba
and elsewhere.
No product that plays a vital
role in the everyday life OF the
average citizen in every commu-
nifty in this country from Hamp-
ton Roads to Puget Sound is sub
jected to more different taxes and
tariffs, or complicated restrictions
and laws than sugar. 1t would
take not one but a half dozen
philadelphia lawyers" to under
stand thoroughly the ramifica-
tions of the quota system as set up
and maintained in this country
to handle the importation and
marketing Of sugar.
Affects Our Pocketbooks
In other countries, especially
Cuba which furnishes us with the
largest single amount Of any area,
the system of allotments which
governs the amounts and condi-
tions under which various COM
panies and plantations produce
and export it is even more COM
plicated and difficult. OF course,
every one of these tariffs, regula-
tions and allotments, whether at
home or abroad, adds to the cost
we pay for the sweetening in our
breakfast coffee.
Except in times of war and
other great emergencies, the pur-
chase and importation Of sugar
has long been rigidly restricted
and regulated. The quota system
was suspended from 1912 to 1947,
but reimposed last year. The ad-
ministration of the 1s4S Sugar
Act, which runs until December
1852, not only affects our personal
pocketbooks, but the whole econ
omy of several other countries as
well as many sections of the
United States itself.
Every one has high praise for
the impartial manner in which
Cuba handles the allotment OF
export quotas to the various pro-
ducing companies. or plantations.
The Cuban Sugar Sterilization
Institute prorates the amount
each mill may export according
to its production capacity. There
are 161 mills, or ingenios on the
island. United States interests
own 48, among them some Of the
largest. Cubans own 100, Spanish
capital operates 10. Dutch inter-
ests z and Canadians !.
Government Tax Heavy
Meantime the Cuban govern
ment exacts a lions share Of taxes
and levies from the industry. 1t
not only collects a production tax
of 20 cents a bag (of 325 pounds .
but also a graduated basic-profits
tax, a surcharge tax and an ex-
cess-profits tax. A company which
makes q profit, say of as much as
$100, 900, pays a basic tax Of Is
per cent plus a surcharge OF 2 per
cent. or q II per cent tax to the
government. On a million-dollar
profit the tax is 221z per cent plus
a surcharge of 5 per cent or 2sh
per cent.
The excess profits tax Is COM
puted in a unique manner. On
June the 30th each year every
company must estimate what it
thinks its profits will be. If 1t
turns out that the actual profit
exceeds the estimates the extra
amount is considered excess prof
its and Is taxed again. Then. If
the producer is an American. his
earnings are also subjected to in
come and xcess-proflts taxes in
the States.
Not only the sugar industry but
all other United States investors
in Cuba, as well as those con-
nected with the United States
Cuban export and import trade
are worried about the continuing
threat of a reduction in quotas
allowed Cuba. They complain
that the basic quotas which the
present law allows are much
smaller than the island has al
ways supplied in years when our
imports have not been restricted.
This hits United States-owned
plantations particularly hard be-
cause they account for 1926 per
cent of the islands entire output.
1t also seriously affects investors
in Cuban railroads, hydroelectric
and cement plants. telephone COM
panies, textile mills, oil and gaso-
line distributing companies and
innumerable other enterprises.
Not only are their incomes de-
pendent upon Cuba's exports, but
they are able to send out their
earnings to stockholders through
out the United States only when
there are large amounts Of dollars
coming in for purchases Of sugar.
Trend of Cuban Buying
All of these people call atten-
ton to what they feel are the in
consistencies in our trade policy
toward Cuba. For instance. the
Truman administration has nego-
tiated and presented to the SEN
ate for ratification an interna-
tional trade agreement pledging
this country and the other sigma
tory nations to a policy Of lower
ing barriers to and restrictions on
trade and commerce. The United
States Sugar Act itself states that
one Of its chief purposes Is ito
promote the export trade Of the
United States"
But our limitation on Cuban
sugar imports has just the op-
posite effect. During the low quota
period Of 1e34-1941 Cuba bought
only about $79.oo0.o0o worth Of