Drawbacks of duties are refunds of duties paid on goods that are re-exported; they have been provided for ever since the first tariff act of 1789. If imported raw materials are used in a finished product exported a drawback of 99 per cent of the duties paid when the raw materials were imported is allowed if the ex porter of the finished product can satisfactorily identify the raw materials according to Treas ury Department regulations. Drawbacks are allowed of the internal revenue duties paid on alcohol that has been used in medical or toilet preparations subsequently exported. Duties on wheat, imported from Canada, may be re funded if the flour made therefrom be exported. Drawbacks differ with the various tariff acts but the provisions are becoming more and more strict, so that the privilege is now limited to operations that can be thoroughly safe guarded.
Maximum and minimum duties is a term employed to a scale of tariff duties levied on goods imported from countries that discriminate unduly against American products. The Payne Aldrich tariff of 23 Aug. 1909 provided that after 31 March 1910 the duties specified in the act, which constituted the minimum rates, should be increased by 25 per cent of the value of the goods imported if this merchandise came from countries unduly taxing our products in their ports. European tariffs contain such provisions,
which are designed to place nations on an equal commercial footing. The McKinley tariff act of 1890 contained a similar provision but its application was more limited, since the Presi dent, by proclamation, could only levy certain duties on goods imported from certain countries which imposed unreasonable duties on certain articles of American production. Under the act of 1909 undue discrimination might have been either by tariff rates, export duty or ex port bounty or prohibition upon exports, and the President was given power to decide as to the existence of such unreasonable tariffs and the measure of the discrimination. There was con siderable fear that the enforcement of the plan of maximum duties might incite a tariff war and that complications would creep into the schedules regularly established in the act for certain definite ends. Though no such trouble arose, or at least became serious, the plan of maximum and minimum duties contained in the act of 1909 was abolished by the Underwood tariff of 1913. See also INTERNAL REVENUE