gressional Committees recommended the same action. As a result the law of June 22, 1874, was passed. By it all provisions by which moieties had been allowed were repealed, and the proceeds of all fines, penalties and forfeitures were ordered to be paid into the United States Treasury. In cases of the detection of smuggling, and in such cases only, the informer or officer might be allowed such compensation as the Secretary of the Treasury should award-not to exceed five thousand dollars.

Although the law contained numerous changes, its main object and principal result were the abolition of "moieties," with the view to deter officers from bringing and pressing suits in the hope of obtaining a share in the severe and often disproportionate penalties exacted. The law has more than fulfilled its purpose. It is an open question whether Congress did not go too far in the matter, and by removing all strong personal interest leading persons to undertake the risk and labor of bringing prosecutions, open wide the door to frauds and consequent injustice to the honest importer for whose protection this very law was framed. The falling off in the amount received from fines, penalties and forfeitures was immediate and marked.1 In the ten years preceding 1874, there had been brought in the Southern District of New York 957 suits or proceedings, on which $3,696,232.53 were paid into the registry of the court. In the ten years following 1874, 254 suits were begun, and thereon only $393.774.72 were paid into the registry of the court. Yet during the latter period imports vastly increased; and there is no reason,— indeed the tendency of the law would in effect have been the very opposite, to believe that under-valuation was any less prevalent. B. H. Bristow, Secretary of the Treasury, in his annual report for the year 1874, deplored the action of Con

1 Proceeds from this source paid into the Treasury from 1870-1877: Year ending June 20, 1871, $952,579.86; 1872, $674,232.77; 1873, $1,169,515.38; 1874, (law went into effect June 22), $651,271.76; 1875, $228,870.23; 1876, $183,797.86; 1877, $146,413.21.

gress in this matter. Ever since that time there has been a continual demand from the Secretaries of the Treasury for more adequate legislation for the prevention of frauds upon the revenue.

10. Repeal of Discrimination against Goods from the Far East.

The Acts of May 4, 1882, and December 23, 1882,1 repealed the provision of the Act of December 31st, 1862, which levied a discriminating duty of ten per cent. additional upon all goods, wares and merchandise, of the growth or product of the countries east of the Cape of Good Hope, when imported from places west of that Cape. The object of this law had been the fostering of direct commerce with the Orient, carried on in American bottoms. But the opening of the Suez Canal had changed the course of Eastern commerce, which now naturally flowed through this gateway into the European markets. As a consequence, it became much cheaper to bring these goods via the European ports, and it was often very difficult to determine whether goods purchased in Europe were originally from the East or not. The resulting confusion and uncertainty, with no adequate corresponding benefit, rendered the repeal of the act advisable. We see in this a curious instance of how seemingly independent occurrences may affect our administrative problems.

II. Dutiable Value and Similitude Section under the
Act of 1883.

The tariff Act of March 3, 18832 had appended to it several sections governing administrative matters. It contained new and lengthy forms of oaths: first, of the consignee, importer, or agent, to be taken on entry; second, of the owner when the goods had been purchased; and third, of the manufacturer when they had not been purchased. But the forms

1 47th Congress, Session I., Chapter 120; 47th Congress, Session II., Chapter 6. '47th Congress, Session II, Chapter 121.

added little that had not been contained in, or implied by, the oaths formerly required.

The previous law, which provided that the usual and necessary" sacks, crates, boxes or coverings " be estimated as part of the value of imported goods, was repealed; and such charges were not thereafter to be included, in determining the amount of duties for which goods were liable. As the "dutiable value" of goods was declared by the same act to be their "actual market value," or their actual wholesale price in the condition of finish and preparation for sale in which they were finally offered by the foreign merchant to his customers, and as many kinds of goods were never offered for sale and had no market value except as prepared for shipment with their proper coverings, the question at once arose: At what valuation should these goods be entered for duty? A variance of opinions and practice speedily sprang up. The Treasury Department, under Mr. Folger, ruled that coverings, etc., should be included as forming part of the value of the goods. This decision was subsequently upheld by the court.1 The decisions and instructions of the Department resulted, however, in a large number of protests and the bringing of many suits.

The "similitude" section of the existing law, originally enacted in 1842, was reenacted in a more elaborate form, and with the added proviso that "non-enumerated articles similar in material and quality and texture and the use to which they may be applied, to articles on the free list, and in the manufacture of which no dutiable materials shall be used, shall be free." The section, even under a generous interpretation by the Secretary, gave rise to considerable additional litigation. Collectors were still perplexed over the term "market value," in spite of all the defining legislation. Importers who received special goods under consignment even claimed that those goods had no market value. To meet this contention section nine of this act provided that if it should appear that the true and actual

wholesale price could not be ascertained to the satisfaction of the appraiser, it should be lawful to appraise the merchandise by ascertaining the cost or value of the materials composing it at the time and place of manufacture, together with the cost of manufacturing, preparing and putting up for shipment. This ought to have definitely settled the old "no market value" claim; but it was too specious to be given up thus easily,. and we find it urged again and again by contesting consignees of dutiable goods.1

12. Classification of Sugars under the Act of 1883.

Schedule E of the act, relating to sugars, prescribed that the different grades should pay duties according to the Dutch standard of color, to be determined by their "polariscopic test." This was the mere legislative adoption of the form of test already prescribed by the Secretary of the Treasury. On account of the general practice of artificially coloring sugar in order to lower its apparent "Dutch color standard" on which by law it was to pay duty, the Secretary had found it necessary to rule that all sugars be classified by their " natural color," as he called it, that is, by their saccharine strength as determined by the polariscope. The fraud had been very widespread and profitable, and this action of the Secretary naturally gave rise to a great many suits against the government. The government had also brought suit against the importers for fraud. But on account of the great difficulty of proving guilty knowledge as required under the law of 1874, no penalties could be enforced, although fraud was notorious. Sugar was always a very troublesome article to list properly. It seems from the first to have furnished a fruitful field for gigantic frauds upon the reveOne of the earlier methods which had proved very successful had been the importation of cane juice boiled nearly to

nue.

1 The effect of this clause, if it had any, was found to be an increase in the efforts of manufacturers to conceal the price at which they held their goods abroad and to throw upon the appraisers, few of whom had the requisite skill or experience, the burden of ascertaining the cost of manufacture.

the point of crystallization, or of any solution holding a large amount of sugar, as molasses or syrup, which bore a much lighter duty than sugar. Even since the use of the polariscope, grave and suspicious differences have existed between the tests at different ports.

13. Passengers' Baggage.

The law of 1883 again enacted the provision of the former law, exempting from taxation "wearing apparel in actual use and other personal effects," etc. The interpretation of this clause has been very liberal, but is necessarily so indefinite as to give rise to much contention and hard feeling. The examination of passengers' baggage is, from its nature, one of the most troublesome functions of the inspection service. It is the point where the government must go deepest into the private affairs of those with whom it deals; and it is consequently productive of great friction. The wonderful increase in the trans-Atlantic passenger trade, composed in large measure of tourists carrying extensive wardrobes, has added to the difficulties of this service. It has usually been performed on the various steamship wharves, although for a time it was carried on at the barge office in New York. No place is prescribed by law, and in order to expedite matters and to cause as little annoyance and delay as possible to travelers, who would presumably suffer considerable inconvenience if their baggage were long detained, this scattered manner of conducting the

1 See supra, page 30.

2 Astor v. Meritt, 111 U. S. 202, defined the terms as follows: "Wearing apparel owned by the passenger and in condition to be worn at once without further manufacture; (2) brought with him as a passenger and intended for the use or wear of himself or his family who accompanied him as passengers, and not for sale or purchase, or imported for other persons or to be given away; (3) suitable for the season of year which was immediately approaching at the time of the arrival; (4) not exceeding in quantity, or quality, or value, what the passenger was in the habit of ordinarily providing for himself and his family at that time, and keeping on hand for his and their reasonable wants, in view of their means and habits of life, even though such articles had not been actually worn." By no means an easy thing for the inspector to find out!