articles in the commercial treaties between Austria-Hungary and the Balkan States. Treaties may expressly exempt from all forms of internal duties products imported for warehousing or transit, as in the reciprocal agreements made by Bulgaria with Italy and with Roumania in 1906 and 1907. The convention between Austria-Hungary and Serbia in force at the outbreak of the war, stipulated that no internal taxes were to be levied on imported products of either country which were not produced in the other, except a specified Serbian trocharina. Turkey, on the other hand, by imposing high internal taxes on certain articles not produced in that country, has virtually increased her import tariff.

Internal Taxes on Domestic Products Destined for Exportation. An internal tax on a domestic article which is exported operates in the same way as an export duty. It makes the article more expensive, and therefore more difficult to sell, in the competitive markets of the world. When sold abroad, the tax on such a commodity is usually paid by the domestic producer or the exporter, except when the exporting country possesses a world monopoly.

As the general policy of modern states is not to hinder but to facilitate foreign sales, domestic products destined for exportation are usually exempted from the payment of internal revenue taxes. Such exemptions involve many administrative difficulties and are only feasible when goods are produced in large quantities and where the industrial organization is fairly well centralized, as in the manufacture of tobacco, malt and distilled liquors, sugar, etc. The Japanese internal tax on cloth is not collected on cloth exported, but the amount of this tax is included in arriving at the "foreign value ” as a basis for assessing the United States import duty on Japanese cloth coming to this country. As regards the United States, the customs regulations prescribe that tobacco, for example, intended for immediate exportation may be withdrawn from

bonded warehouses or manufactories without paying internal revenue duties "under such regulations, and after making such entries and executing and filing with the collector of the district from which the removal is to be made, such bonds and bills of lading and giving such other additional security as may be prescribed by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury."

BIBLIOGRAPHY

A. Consult bibliographies Chapters IV to X inclusive.

B. Commerce Reports; Consular Reports; Circulars of Customs Division of Treasury Department; Customs Regulations of United States; Bureau of Foreign and Domestic Commerce, Report on Foreign Tariff Systems and Industrial Conditions, 1913; Revised Statutes of U. S.; Tariff Law of U.S.; RUTTER, Tariff Systems of South America (Tariff Series, No. 34); U. S. Tariff Commission reports on Free Zones and on Revision of Customs Administrative Laws; Foreign Tariff Notes; U. S. Treasury Department, Drawbacks under the Present Tariff Acts (64th Cong., 1st Sess., Sen. Doc. 532) 1916.

C. Dictionaries and encyclopedias; economics texts: (MARSHALL, MILL, SMITH;) Readers' Guide; KELLY, Customs Tariffs; Cyclopedia of American Government.

D. GREGORY, Tariffs, 398-440; DEWEY, Financial History; FAWCETT, Free Trade and Protection, Ch. 2; GRUNZEL, Economic Protectionism; TAUSSIG, Some Aspects of Tariff Question; KOEHLER, Importers, First Aid; HIGGINSON, Tariffs at Work, 95-103; ATTON AND HOLLAND, The King's Customs, Vol. I, pp. 474; BASTABLE, Commerce of Nations, 170-177; Foreign Regulations concerning Commercial Travellers and Samples (Tariff Series, Nos. 19 and 197).

E. "Brussels Sugar Convention," Quar. Jour. Econ., 18: 181; No. Am. Review, 190: 347.

SUGGESTIVE TOPICS AND QUESTIONS

1. To what extent, for what purposes, and with what effects were bounties granted in the American colonies? (JOHNSON, Domestic and Foreign Commerce, Vol. I, pp. 60-62.) After the Revolutionary War? (Ibid., Vol. I, pp. 141 et seq.) What is the one significant instance of federal bounty-granting? Compare its effects with those of protective

duties. (TAUSSIG, Some Aspects, 53-56.) Can you cite any case of federal export bounty in our history? (Cyclopedia of American Government, Vol. I, p. 167.)

2. What opinions regarding bounties were held by Alexander Hamilton? (His Report on Manufactures.) Adam Smith? (Wealth of Nations, Bk. IV, Ch. 5.) Ricardo? (Principles of Political Economy, Ch. 22.) J. S. Mill? (Principles of Political Economy, Bk. V, Ch. 10.) Marshall? (Principles of Economics, Bk. V, Ch. 7.) Sidgwick? (Method and Scope, p. 18.)

3. Does a drawback operate advantageously to home producers? How would allowances of drawback in the United States on imported salt, for instance, affect the interests of domestic salt producers?

4. What are some of the abuses in the application of the "equivalent principle"? Grunzel, 204–207, 216–220.

5. Cite notable examples of (a) private export bounties; (b) bounties through freight rate concessions. GRUNZEL, 220-239.

6. Summarize and criticize Grunzel's conclusions as to the effect of export bounties. Economic Protectionism, 318-326.

7. Note in recent issues of Foreign Tariff Notes and Commerce Reports (Tariffs and Trade Regulations) changes in different countries as to bounties, drawbacks, temporary admission, and exemptions from duties; seek to discover the cause and significance of changes noted.

CHAPTER X

ADMINISTRATIVE INSTITUTIONS

General Methods of Tariff Administration. For the purpose of guarding general interests, especially the financial interests of the government and the protected interests of the producers, various methods of tariff administration have been adopted in different countries to carry out the purposes of the law regarding the levying of correct duties, the settlement of disputes regarding customs matters, and the like. In the United States, tariff administration rests primarily with the Treasury Department.

Immediately under an Assistant Secretary of the Treasury is the Division of Customs in which center all matters pertaining to the supervision and administration of the customs and by which are prepared instructions and regulations relating to the collection of duties under the laws concerning imports. As in other countries, the law provides that imported goods may be entered and delivered only at specified places. There are forty-nine Customs Districts each containing several ports of entry. Each district is under a Collector of Customs (often informally called Collector of the Port) whose headquarters is at the principal port of entry in the district. He is aided by many deputy collectors, at least one of whom is stationed at each subport of entry. At some of the more important ports are provided a Surveyor to superintend the unloading, weighing, measuring, and gauging of imported merchandise, and a Comptroller (formerly called Naval Officer) who serves as auditor and reports direct to the Treas

ury Department. At all ports of entry, imports are inspected by government appraisers (sometimes colloquially called "local appraisers " to distinguish them from General Appraisers).

All imported goods exceeding one hundred dollars in value must be accompanied by an invoice sworn to before an American consul at the place of shipment.1 These invoices are usually made out in triplicate, one copy being kept on file in the consulate, one being sent to the Collector of the port of entry in the United States, and the third being given to the exporter for transmittal to the importer or consignee. The invoice, together with any information obtained from other sources such as trade reports, government statistics, and American treasury experts stationed in foreign countries, furnishes the basis of valuation for purposes of levying the duty. The value of all goods imported into the United States is determined, in the first place, by a local appraiser. In case of dissatisfaction either on the part of the Collector of Customs or of the importer, appeal may be made to a General Appraiser and finally to a Board of General Appraisers whose decision shall be final and conclusive as to the dutiable value of such merchandise against all parties interested therein. As regards the rate and amount of duties, the decision rests, in the first instance, with the Collector of Customs. In case of dissatisfaction on the part of the importer or consignee with his conclusion, the facts may be referred to a Board of General Appraisers. Such a board is constituted as follows: The President of the United States appoints a board of nine members which is in turn divided into three boards of three members each, to hear appeals for review of appraisement of merchandise and protests against the decisions of the Collector. Headquarters is at New York where most of their work is

1 As to methods of consuls in arriving at true valuation, see JONES, Consular Service, 79–82; as to contents of invoice, see ROSENTHAL, Technical Procedure in Importing and Exporting, Ch. 9.