New Port Tax Rejected

 

April 2004--The National Retail Federation (NRF) is applauding the Senate Commerce Committee's recent rejection of a proposed federal tax to cover the cost of security improvements at the nation's ports. According the NRF, the costs are already covered through shippers' fees, and instituting any more fees would impose an unnecessary tax on the American consumer.

In a 13-10 vote, the Committee approved the removal of the "security service fee" from S. 2279, the Maritime Transportation Security Act of 2004. The amount of the fee was not specified in the bill and would have been levied at the discretion of the Secretary of Homeland Security. The bill sets several standards for international cargo and port security measures.

Traditionally, private interests such as port authorities, port service providers and users, including NRF members, have funded seaport infrastructure initiatives. Imposing a federally mandated fee on top of those already paid via charges to terminal operators and steamship lines, which are then recouped in transportation costs by retailers and other shippers, would make security more expensive than is necessary, said NRF Senior Vice President of Government Relations Steve Pfister.

Pfister added that if government funds are to be used to pay for security improvements, they should come from the $20 billion shippers already pay annually in trade tariffs rather than a new tax.