A-18469, APRIL 25, 1932, 11 COMP. GEN. 400

A-18469: Apr 25, 1932

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THE COUNTRY OF THE PORT IN WHICH A VESSEL LAST ENTERS AND CLEARS IS THE COUNTRY FROM WHICH IT COMES. MUST BE CONSIDERED AS COMING FROM THE PHILIPPINE ARCHIPELAGO WITHIN THE MEANING OF THESE LAWS AND THE TONNAGE TAXES COLLECTED UPON SUCH VESSELS ARE FOR CREDITING TO THE PHILIPPINE ISLANDS FUND. IF A VESSEL IS ENTERED AND CLEARED AT A PORT IN A FOREIGN COUNTRY AFTER LEAVING THE PHILIPPINE ISLANDS. THE TONNAGE TAXES COLLECTED UPON SUCH VESSEL ARE FOR CREDITING TO THE GENERAL FUND OF THE TREASURY. 1932: THERE IS FOR CONSIDERATION BY THIS OFFICE THE QUESTION WHETHER CERTAIN AMOUNTS COLLECTED AS TONNAGE TAX BY THE COLLECTOR OF CUSTOMS AT HONOLULU FROM FOREIGN VESSELS ENTERING THAT PORT FROM THE PHILIPPINE ISLANDS SHOULD BE CREDITED TO THE PHILIPPINE ISLANDS FUND OR SHOULD REMAIN TO THE CREDIT OF THE UNITED STATES AS DEPOSITED AND COVERED INTO THE TREASURY BY THE COLLECTOR OF CUSTOMS.

A-18469, APRIL 25, 1932, 11 COMP. GEN. 400

TONNAGE TAXES UNDER THE PROVISIONS OF SECTION 2 OF THE ACT OF APRIL 29, 1908, 35 STAT. 770, REQUIRING THE PAYMENT OF THE SAME TONNAGE TAXES ON FOREIGN VESSELS COMING INTO THE UNITED STATES FROM THE PHILIPPINE ARCHIPELAGO AS UPON VESSELS WHICH ENTERED FROM FOREIGN COUNTRIES, AND SECTION 4 OF THE ACT OF MARCH 8, 1902, 32 STAT. 54, PROVIDING THAT DUTIES AND TAXES COLLECTED FROM FOREIGN VESSELS COMING INTO THE UNITED STATES FROM THE PHILIPPINE ARCHIPELAGO SHALL BE PLACED TO THE CREDIT OF THE PHILIPPINE ISLANDS FUND, THE COUNTRY OF THE PORT IN WHICH A VESSEL LAST ENTERS AND CLEARS IS THE COUNTRY FROM WHICH IT COMES, AND FOREIGN VESSELS WHICH ENTERED AT HONOLULU AFTER ENTERING AND CLEARING AT MANILA, MUST BE CONSIDERED AS COMING FROM THE PHILIPPINE ARCHIPELAGO WITHIN THE MEANING OF THESE LAWS AND THE TONNAGE TAXES COLLECTED UPON SUCH VESSELS ARE FOR CREDITING TO THE PHILIPPINE ISLANDS FUND, NOTWITHSTANDING THE VOYAGES OF SUCH VESSELS ORIGINATED IN A FOREIGN COUNTRY; HOWEVER, IF A VESSEL IS ENTERED AND CLEARED AT A PORT IN A FOREIGN COUNTRY AFTER LEAVING THE PHILIPPINE ISLANDS, EVEN WHEN THE VOYAGE ORIGINATES IN THE PHILIPPINE ARCHIPELAGO, THE TONNAGE TAXES COLLECTED UPON SUCH VESSEL ARE FOR CREDITING TO THE GENERAL FUND OF THE TREASURY.

DECISION BY COMPTROLLER GENERAL MCCARL, APRIL 25, 1932:

THERE IS FOR CONSIDERATION BY THIS OFFICE THE QUESTION WHETHER CERTAIN AMOUNTS COLLECTED AS TONNAGE TAX BY THE COLLECTOR OF CUSTOMS AT HONOLULU FROM FOREIGN VESSELS ENTERING THAT PORT FROM THE PHILIPPINE ISLANDS SHOULD BE CREDITED TO THE PHILIPPINE ISLANDS FUND OR SHOULD REMAIN TO THE CREDIT OF THE UNITED STATES AS DEPOSITED AND COVERED INTO THE TREASURY BY THE COLLECTOR OF CUSTOMS. A COLLECTION OF $185.46 WAS MADE JANUARY 6, 1931, FROM THE BRITISH S.S. SILVERHAZEL, AND $270.90 FROM THE DUTCH S.S. KOTA GEDE.

WITH RESPECT TO THE VOYAGES OF THESE TWO VESSELS, IT IS STATED IN LETTER FROM THE COLLECTOR OF CUSTOMS AT HONOLULU, DATED MARCH 29, 1932, THAT THE KOTA GEDE LOADED CARGO AT CALCUTTA, SINGAPORE, AND MANILA, AND THE SILVERHAZEL AT CALCUTTA, SINGAPORE, RANGOON, AND MANILA, FOR DISCHARGE AT HONOLULU AND OTHER AMERICAN PORTS. IN SUPPORT OF THE ACTION TAKEN BY THE COLLECTOR IN CREDITING THESE AMOUNTS OF TONNAGE TAX TO THE UNITED STATES INSTEAD OF TO THE PHILIPPINE ISLANDS FUND, IT HAS BEEN STATED THAT SINCE THE VOYAGES IN THESE CASES ORIGINATED AT CALCUTTA---MANILA BEING MERELY AN INTERMEDIATE PORT OF CALL--- THE PHILIPPINE ISLANDS FUND WAS NOT ENTITLED TO CREDIT FOR THE TONNAGE TAX COLLECTED IN THESE TWO CASES.

BY SECTION 2 OF THE ACT OF APRIL 29, 1908, 35 STAT. 70, SUPERSEDING A SIMILAR PROVISION IN THE ACT OF MARCH 8, 1902, 32 STAT. 54, IT WAS PROVIDED THAT THE SAME TONNAGE TAXES SHOULD BE LEVIED, COLLECTED, AND PAID UPON ALL FOREIGN VESSELS COMING INTO THE UNITED STATES FROM THE PHILIPPINE ISLANDS WHICH ARE REQUIRED BY LAW TO BE LEVIED, COLLECTED, AND PAID UPON VESSELS COMING INTO THE UNITED STATES FROM FOREIGN COUNTRIES, AND SECTION 4 OF THE ACT OF MARCH 8, 1902, PROVIDED, IN PART, AS FOLLOWS:

THAT * * * ALL DUTIES AND TAXES COLLECTED IN THE UNITED STATES UPON ARTICLES COMING FROM THE PHILIPPINE ARCHIPELAGO AND UPON FOREIGN VESSELS COMING THEREFROM, SHALL NOT BE COVERED INTO THE GENERAL FUND OF THE TREASURY OF THE UNITED STATES, BUT SHALL BE HELD AS A SEPARATE FUND AND PAID INTO THE TREASURY OF THE PHILIPPINE ISLANDS, TO BE USED AND EXPENDED FOR THE GOVERNMENT AND BENEFIT OF SAID ISLANDS.

THE ACT OF JULY 5, 1884, 23 STAT. 118, BEING AN ACT TO CREATE A BUREAU OF NAVIGATION, PROVIDED, IN SECTION 3:

THAT THE COMMISSIONER OF NAVIGATION SHALL BE CHARGED WITH THE SUPERVISION OF THE LAWS RELATING TO THE ADMEASUREMENT OF VESSELS, AND THE ASSIGNING OF SIGNAL LETTERS THERETO, AND OF DESIGNATING THEIR OFFICIAL NUMBER; AND ON ALL QUESTIONS OF INTERPRETATION GROWING OUT OF THE EXECUTION OF THE LAWS RELATING TO THESE SUBJECTS, AND RELATING TO THE COLLECTION OF TONNAGE TAX AND TO THE REFUND OF SUCH TAX WHEN COLLECTED ERRONEOUSLY OR ILLEGALLY, HIS DECISION SHALL BE FINAL.

IN A DECISION OF A FORMER COMPTROLLER OF THE TREASURY, 26 COMP. DEC. 820, CONSTRUING THE PROVISIONS OF THIS SECTION, IT WAS HELD THAT THE ACCOUNTING OFFICERS WILL NOT QUESTION THE DECISION OF THE COMMISSIONER OF NAVIGATION, AND THE APPROVAL THEREOF BY THE SECRETARY OF COMMERCE, HOLDING THAT TONNAGE TAXES LEVIED ON A CERTAIN VESSEL ENTERING A PORT OF THE UNITED STATES WERE EXCESSIVE, BUT WILL REFUND THE EXCESS IN ACCORDANCE WITH SUCH DECISION. IT APPEARS TO BE A SETTLED RULE, THEREFORE, THAT, IN SO FAR AS THE QUANTUM OF THE TONNAGE TAX WHICH HAS BEEN OR IS TO BE COLLECTED IN A GIVEN CASE IS CONCERNED, THE DECISION OF THE COMMISSIONER OF NAVIGATION IS FINAL AND CONCLUSIVE UPON THE ACCOUNTING OFFICERS. THERE APPEARS TO BE NOTHING IN THE LAW, HOWEVER, REQUIRING A DETERMINATION BY THE COMMISSIONER OF NAVIGATION WHETHER IN THE CASE OF A VESSEL COMING FROM THE PHILIPPINE ISLANDS THE TONNAGE TAX COLLECTED SHOULD BE FOR THE CREDIT OF THE PHILIPPINE ISLANDS FUND OR SHOULD BE COVERED INTO THE GENERAL FUND OF THE TREASURY. SUCH DETERMINATION UNDER SECTION 4 OF THE ACT OF MARCH 8, 1902, SUPRA, IS PROPERLY FOR THE ACCOUNTING OFFICERS OF THE GOVERNMENT UNDER SECTION 236, REVISED STATUTES, AS AMENDED BY SECTION 305 OF THE BUDGET AND ACCOUNTING ACT OF JUNE 10, 1921, 42 STAT. 24.

IN A CASE INVOLVING, IN SUBSTANCE, THE CONVERSE QUESTION OF THAT PRESENTED IN THE INSTANT MATTER UNDER SECTION 6 OF THE ACT OF APRIL 30, 1906, 34 STAT. 154, AND SECTION 4 OF THE ACT OF 1902, IT WAS HELD IN DECISION OF JUNE 10, 1907, 13 COMP. DEC. 848, THAT THE COUNTRY OF THE PORT IN WHICH A VESSEL LAST ENTERS AND CLEARS IS THE COUNTRY FROM WHICH IT COMES, AND, IT APPEARING IN THAT CASE THAT THE VESSEL HAD ENTERED AND CLEARED AT ALGIERS AFTER LEAVING THE PHILIPPINE ISLANDS, IT WAS HELD THAT IT DID NOT COME TO THE UNITED STATES FROM THE PHILIPPINE ARCHIPELAGO, AND THEREFORE THAT THE TONNAGE TAXES COLLECTED THEREON SHOULD BE PAID INTO THE TREASURY OF THE UNITED STATES. IF THE RULE IN THAT CASE BE APPLIED CONVERSELY TO THE QUESTION PRESENTED BY THE CASE HERE UNDER CONSIDERATION, IT WOULD APPEAR THAT THE TWO VESSELS INVOLVED HAVING CLEARED FROM MANILA, A PORT OF THE PHILIPPINE ARCHIPELAGO, THE TONNAGE TAXES COLLECTED SHOULD BE FOR CREDIT TO THE PHILIPPINE ISLANDS FUND.

BY LETTER OF FEBRUARY 20, 1932, THE SECRETARY OF COMMERCE ADVISED THIS OFFICE, IN PART, AS FOLLOWS:

THE COMMISSIONER OF NAVIGATION STATES THAT TONNAGE TAX IS BASED UPON THE RATE APPLICABLE TO THE FOREIGN COUNTRY FROM WHICH THE VESSEL ENTERS. THIS STATEMENT, HOWEVER, IS SUBJECT TO THE EXPLANATION THAT IF SUCH VESSEL WHILE IN BALLAST TOUCHES AT A MINIMUM RATE PORT AND TAKES ON NO CARGO OR BUT A SMALL AMOUNT, THE VOYAGE WILL BE CONSIDERED AS HAVING ORIGINATED IN THE MAXIMUM RATE COUNTRY AND THE TOUCHING AT THE MINIMUM RATE PORT WILL BE BUT AN INCIDENT OF THE ORIGINAL VOYAGE.

THE COLLECTOR OF CUSTOMS AT HONOLULU HAS BEEN INFORMED THAT TONNAGE TAX AT THE MAXIMUM RATE SHOULD BE COLLECTED FROM FOREIGN VESSELS ENTERING HIS PORT FROM THE PHILIPPINE ISLANDS AS REQUIRED BY SECTION 2 OF THE ACT OF APRIL 29, 1908 (U.S.C., TITLE 46, SECTION 127). HE HAS ALSO BEEN INFORMED THAT WHEN THE VOYAGE OF SUCH VESSELS ORIGINATES IN THE PHILIPPINE ISLANDS, THAT IS WHEN THE CARGO IS OBTAINED IN THE PHILIPPINES OR THE VESSEL ENTERS IN BALLAST FROM THE PHILIPPINES AFTER DISCHARGING HER CARGO THERE, THE TONNAGE TAX COLLECTED SHOULD BE CREDITED TO THE PHILIPPINE ISLANDS FUND.

THERE APPEARS TO BE NO QUESTION AS TO THE AMOUNT OF TONNAGE TAX COLLECTIBLE IN THE TWO CASES INVOLVED IN THE PRESENT CASE, THE LAW OF 1908 PROVIDING IN SPECIFIC TERMS THAT THE SAME RATE OF TONNAGE TAX SHOULD BE COLLECTED AS IF THE VESSELS HAD COME DIRECT FROM A PORT IN A FOREIGN COUNTRY. IT APPEARS, HOWEVER, THAT THE LAST SENTENCE IN THE LAST PARAGRAPH QUOTED, SUPRA, WHILE PROPER AND NECESSARY IN CASES WHERE THE RATE OF TONNAGE TAX IS AFFECTED, IS UNDULY RESTRICTIVE AND UNNECESSARY UNDER THE PROVISIONS OF SECTION 4 OF THE ACT OF 1902. UNDER THE LAW AND UNDER THE DECISION CITED HEREIN, 13 COMP. DEC. 848, IT WOULD APPEAR IMMATERIAL WHETHER THE VOYAGE ORIGINATES IN THE PHILIPPINE ISLANDS IN THE SENSE THAT IT OBTAINED ITS CARGO THERE, OR THAT IT ENTERS IN BALLAST AT A PORT IN THE UNITED STATES FROM THE PHILIPPINE ISLANDS. THE LAW APPLIES IF THE VESSEL CAME FROM THE PHILIPPINE ISLANDS IN THE SENSE THAT IT WAS ENTERED AND CLEARED AT A PORT IN THE ARCHIPELAGO, EVEN IF THE ENTERING AND CLEARING IS AN INTERMEDIATE PORT OF CALL, AND, IN SUCH CASES, THE TONNAGE TAX PROVIDED BY LAW AND AS ADMINISTRATIVELY DETERMINED SHOULD BE CREDITED TO THE PHILIPPINE ISLANDS FUND. IN THE TWO CASES HERE UNDER CONSIDERATION IT APPEARS THAT WHILE THE VOYAGES OF THE VESSELS ORIGINATED AT CALCUTTA, INDIA, THEY WERE ENTERED AND CLEARED AT MANILA, I., AND, THEREFORE, THEY CAME FROM THE PHILIPPINE ARCHIPELAGO WITHIN THE MEANING OF SECTION 4 OF THE ACT OF 1902, SUPRA, AND THE TONNAGE TAX COLLECTED SHOULD HAVE BEEN CREDITED TO THE PHILIPPINE ISLANDS FUND.

ACCORDINGLY, THE PROPER ACTION WILL BE TAKEN BY THIS OFFICE TO EFFECT AN ADJUSTMENT IN THE AMOUNT OF $456.36 IN THE RECEIPT ACCOUNTS BY DEBITING THE RECEIPT ACCOUNT,"0030--- TONNAGE TAX," AND CREDITING THE RECEIPT ACCOUNT,"0956--- TONNAGE TAX, PHILIPPINE ISLANDS--- SPECIAL FUND.'

IN THE LETTER OF MARCH 29, 1932, FROM THE COLLECTOR OF CUSTOMS AT HONOLULU THERE IS PRESENTED, ALSO, FOR CONSIDERATION, THE FOLLOWING QUESTION:

ATTENTION IS CALLED TO ENTRANCE TO AMERICAN VESSELS FROM THE PHILIPPINES VIA HONG KONG, SHANGHAI, KOBE, AND YOKOHAMA. IT IS BELIEVED THAT TONNAGE TAX COLLECTED FROM THESE VESSELS SHOULD NOT BE CREDITED TO THE PHILIPPINE ISLANDS FUND, INASMUCH AS NO TONNAGE WOULD BE DUE IF THEY PROCEEDED DIRECTLY FROM THE PHILIPPINES TO HONOLULU WITHOUT TAKING ANY CARGO AT THE FOREIGN PORTS MENTIONED ABOVE. THIS OFFICE WOULD LIKE TO BE ADVISED REGARDING THIS ALLOCATION AND ALSO REGARDING FOREIGN VESSELS ENTERING THE SAME WAY.

THIS QUESTION MAY BE ANSWERED BY INVITING ATTENTION TO THE DECISION, 13 COMP. DEC. 848, HEREINBEFORE CITED, WHICH APPEARS TO COVER. IN CASES WHERE THE VESSEL, WHETHER OF AMERICAN OR FOREIGN REGISTRY, IS ENTERED AND CLEARED AT A PORT IN A FOREIGN COUNTRY AFTER LEAVING THE PHILIPPINE ISLANDS, THE TONNAGE TAX COLLECTED AS MAY BE DETERMINED BY THE COMMISSIONER OF NAVIGATION IS FOR COVERING INTO THE GENERAL FUND OF THE TREASURY OF THE UNITED STATES AND NOT FOR THE CREDIT OF THE PHILIPPINE ISLANDS FUND.