Mr. Sherman to Count Lichtervelde.

No. 20.]

Sir: Referring to your note of the 5th ultimo, relative to the request of your Government for the exemption of the vessels of Belgium (clearing from Belgian ports) from tonnage dues in the ports of the United States, I have the honor to inform you that the Department has received a letter from the Acting Secretary of the Treasury stating that the law under which application is made by the Belgian Government for the exemption from tonnage taxes of vessels entering the United States from Belgian ports is section 11 of the act of June 19, 1886, which reads as follows:

The President of the United States shall suspend the collection of so much of the duty herein imposed, on vessels entered from any foreign port, as may be in excess of the tonnage and lighthouse dues, or other equivalent tax or taxes, imposed in said port on American vessels by the Government of the foreign country in which such port is situated, and shall, upon the passage of this act and from time to time thereafter as often as it may become necessary by reason of the changes in the laws of the foreign countries above-mentioned, indicate by proclamation the ports to which such suspension shall apply, and the rate or rates of tonnage-duty, if any, to be collected under” such suspension: Provided, further, That such proclamation shall exclude from the benefits of the suspension herein authorized the vessels of any foreign country in whose ports the fees or dues of any kind or nature imposed on vessels of the United States, or the import or export duties on their cargoes, are in excess of the fees, dues or duties imposed on the vessels of such country, or on the cargoes of such vessels.

But this proviso shall not be held to be inconsistent with the special regulation by foreign countries, of duties and other charges on their own vessels, and the cargoes thereof, engaged in their coasting trade, or with the existence between such countries and other states of reciprocal stipulations founded on special conditions and equivalents, and thus not within the treatment of American vessels under the most favored nation clause in treaties between the United States and such countries.

The Acting Secretary of the Treasury observes that under this law the tonnage tax now imposed in the United States on vessels entering the United States from Belgian ports is 6 cents per net ton, not to exceed 30 cents per annum, while article 1 of the royal Belgian decree, dated January 25, 1896 (Annex 1, Stad Antwerpen, Scheepvaartrechten, 1896), provides: “Seagoing vessels entering the docks will pay to the city [Page 41](Antwerp) for each voyage a tax of fifty centimes per net ton Moorson, whatever the number of voyages during the year may be,” and that, moreover, by article 3 vessels discharging or taking on cargo, when not admitted to the docks, are required to pay the same charges, and by the same article a reduction is made in the tonnage dues in cases where the same vessel makes ten voyages or more during the year.

The Acting Secretary of the Treasury states, furthermore, that upon an examination it appears to his Department:

  • First. That the tonnage taxes imposed at Antwerp are higher than those imposed in the United States, the former being about 9 cents per net ton while the latter are but 6 cents; the former are imposed on each entry of a vessel while the latter are imposed on not to exceed five entries of the same vessel during the year.
  • Second. That the taxes are imposed by a foreign Government, as is shown by the royal sanction of the action of the local authorities at Antwerp.
  • Third. That the tonnage taxes levied at Antwerp can not be regarded as strictly dock charges, as they are imposed on vessels at anchor as well as on those admitted to the docks.
  • Fourth. That the tonnage taxes appear in effect to be “other equivalent taxes” to those imposed in the United States. The fact that tonnage taxes in the United States are devoted to the maintenance of the marine hospital, while in Belgium they are applied toward paying interest on extensive harbor improvements, does not appear to alter the fact that, should the exemption asked for be granted, vessels from Belgium would be exempted from taxation in the United States based on tonnage, while vessels from the United States would continue subject to taxation in Belgium, based on tonnage. The Government of the United States expends annually large sums of money to secure deep water in its harbors, for which no charge is imposed on vessels, American or foreign, entering those harbors.

In view of these considerations the Treasury Department is of the opinion that the exemption from tonnage taxes of vessels entering the United States from Belgium should not be granted, pursuant to section 11 of the act of June 19, 1886.

In conclusion, the Acting Secretary of the Treasury says that it is not deemed necessary to review in detail the Belgian regulations for the harbors of Ghent and Ostend, which are not in principle essentially different from those at Antwerp, or to review optional charges, such as employment of tugs, storage, etc., at Antwerp, which are not involved in the consideration of the application in question.

Accept, etc.,

John Sherman.