Source: https://openjurist.org/108/f3d/290/royal-caribbean-cruises-ltd-v-united-states
Timestamp: 2019-02-21 04:20:22
Document Index: 479637846

Matched Legal Cases: ['§ 4472', '§ 4471', '§ 4471', '§ 4472', '§ 4472', '§ 4471', '§ 4471', '§ 4471', '§ 4471']

108 F. 3d 290 - Royal Caribbean Cruises Ltd v. United States
108 F3d 290 Royal Caribbean Cruises Ltd v. United States
108 F.3d 290
1997 A.M.C. 2702, 79 A.F.T.R.2d 97-1638,
65 USLW 2644,
97-1 USTC P 70,073, 10 Fla. L. Weekly Fed. C 787
ROYAL CARIBBEAN CRUISES, LTD., Plaintiff-Counter-Defendant-Appellee,
26 U.S.C. § 4472(1)(A).
In this case, both parties argue with vigor that the statute is unambiguous. The government points to the language of § 4471(c), which provides for taxation "at the time of first embarkation or disembarkation in the United States." 26 U.S.C. § 4471(c). The government argues that the word "first" indicates that there can be multiple embarkations or disembarkations. There can be more than one instance of getting on or off a ship, the government argues, but there can be only one beginning or end of a voyage. The government thus contends that the word "first" supports the government's reading of the statute. The government also notes that § 4472 refers to a voyage during which the passengers "embark or disembark the vessel." 26 U.S.C. § 4472(1)(A) (emphasis added). This provision, the government argues, is framed in terms of getting on or off a vessel, not beginning or ending a voyage.
The Conference Report indicates that the tax in § 4471 is to be assessed "either on initial embarkation or disembarkation in the United States." 1989 U.S.C.C.A.N. at 3205. The Senate Report explains that the tax is to be assessed "when a passenger first embarks or disembarks in the U.S." 135 Cong. Rec. at 24,359. The use of the words "initial" and "first," like the use of the word "first" in § 4471(c), could be construed to mean that there can be multiple embarkations or disembarkations. This construction would suggest that "embarkation" and "disembarkation" mean "get on or off a ship" because there can be multiple instances of getting on or off a ship, but there can be only one beginning or end of a voyage. However, the Conference Report and Senate Explanation explain that the tax will apply to a vessel that "embarks from a United States port on a voyage ...." 1989 U.S.C.C.A.N. at 3205; 135 Cong. Rec. at 24,359 (emphasis added). By speaking in terms of "embark[ing] ... on a voyage," these legislative materials provide support for Royal Caribbean's argument that "embark" and "disembark" mean "begin or end a voyage."
Although the words "embarkation" and "disembarkation" are ambiguous as used in § 4471, we conclude that the most reasonable reading of these words, in light of the legislative history and applicable regulation, is that they mean "beginning or end of a voyage." This interpretation is consistent with the general rule of construction that ambiguous tax statutes are to be construed against the government and in favor of the taxpayer. See Miller v. Standard Nut Margarine Co., 284 U.S. 498, 508, 52 S.Ct. 260, 263, 76 L.Ed. 422 (1932); Gould v. Gould, 245 U.S. 151, 153, 38 S.Ct. 53, 53, 62 L.Ed. 211 (1917); Tandy Leather Co. v. United States, 347 F.2d 693, 694-95 (5th Cir.1965).2 We therefore hold that the tax provided for in § 4471 is not applicable when passengers who begin and end their voyages at foreign ports get on or off a ship during a stopover in the United States. Instead, this tax is only applicable when passengers begin or end their voyages in the United States.