Count Reventlow to Mr. Gresham.

Mr. Secretary of State: In a communication addressed, under date of the 30th of August last, by the honorable Secretary of the Treasury to the collector of customs at Baltimore, and published sub numero 15209 among the “Decisions under the tariff and navigation laws, etc., August, 1894,” Denmark is placed among the countries which indirectly allow bounties on the exportation of sugar; it is consequently to be presumed that sugar of Danish origin imported into the United States will be subjected to the additional import duty of one-tenth of a cent per pound provided by the custom tariff act, section 182½, for sugar imported from countries that allow bounties on the exportation of that article.

The King’s minister of foreign affairs remarks on this subject that as the privilege of the most favored nation is secured to Denmark as regards import duties payable in the United States, by Article V of the convention of April 26, 1826, and that as the additional duty in question is applicable only to certain foreign countries, the Royal Government can not consider the levying of this additional import duty on Danish goods as being in conformity with said convention.

However, if the United States Government is unable wholly to adopt this view, the Royal Government natters itself that, when once the American Government is accurately informed with regard to the conditions on which sugar is exported from Denmark, the additional duty in question will not be levied upon Danish sugar, or at least the greater part of it, for direct bounties on the exportation of sugar are not allowed at all in the Danish Monarchy, and, as to indirect bounties, there is but a single case in which there can be any question of paying such a bounty.

The Kingdom of Denmark proper produces beet sugar only. The tax on the manufacture is paid, not according to the quantity of beets or of beet juice used, but simply according to the quantity of sugar that is manufactured, and the exact equivalent of the tax actually paid is refunded when the sugar is exported. There is but a single case in which there is a slight deviation from this system, viz, that in which sugar, darker-colored than Amsterdam standard No. 19, and on the manufacture of which there is a tax of 2.25 ore per pound, is refined and then exported. One hundred pounds of sugar, when refined, yields 80 pounds of powdered sugar (melis),1 10 pounds of brown sugar (farin),1 and 7 pounds of molasses (sirup),1 while 3 pounds are lost. In case of exportation the following refunds are made: On 80 pounds of melis, 2 crowns 40 öre; on 10 pounds of farin, 22½ öre; on 7 pounds of [Page 206]sirup, 7 öre; total, 2 crowns 69½ öre. After deducting the tax paid of 2 crowns 25 öre there remains the sum of 44½ öre; i. e., 0.556 ore per pound of melis.

In this case it may be claimed that there is an indirect export bounty of 0.556 ore per pound of melis, but this is the only case possible, and besides, it must be remembered that Denmark exports but little refined sugar to the United States. During the years 1889–1893 the average annual exportation to America amounted, it is true, to 2,660 pounds, but it appears that this was exclusively for consumption on board of the vessels on which it was shipped.

The Danish Antilles, in the West Indies, produce cane sugar only; the manufacture of this sugar is exempt from taxation; there are no refineries there, and not only are no bounties, direct or indirect, allowed on its exportation, but an export duty of 5 per cent ad valorem is levied.

The King’s Government is naturally very desirous that Denmark should be stricken from the list of countries which allow bounties on the exportation of sugar; if, however, the United States Government, in view of the exceptional case above mentioned, does not think that it can comply with this desire, I have the honor to solicit your good offices, Mr. Secretary of State, to the end: First, that, in all cases, the Danish Antilles of the West Indies may be placed outside of the provision for the additional duty. Since those islands form a separate customs territory, with its own customs laws, there can be no objection to granting them a separate place in this respect; and, as appears from the facts above stated, there is no ground whatever for even a suspicion that a bounty, either direct or indirect, is allowed in those islands; second, that, as regards the Kingdom of Denmark proper, the Treasury Department may take measures to permit, according to paragraph 182½ of the tariff, the admission, without payment of the additional duty, of all sugar of Danish origin other than the above-named melis.

I herewith inclose a copy of the law in force relative to the tax on sugar produced in Denmark, and I beg your excellency to be pleased to submit to the proper Department the desires which I have just communicated to you on behalf of my Government, and then to enable me to inform the minister of foreign affairs of the decision that maybe reached on this subject.

Be pleased, etc.,

F. Reventlow
.
  1. So called in Danish.
  2. So called in Danish.
  3. So called in Danish.