CUSTOMS DUTIES. Taxes levied upon mer chandise which passes a frontier; generally upon goods imported. Such taxes are of very early origin, and in the long conflict between the Eng lish King and the Commons over the right of taxation it was claimed that these taxes were ancient customs over which Parliament had no jurisdiction. Hence the name which has since clung to this class of taxes. It appears that in their origin such taxes were largely in ,the nature of payments for privileges of trading at certain places and for use of the facilities of ports and markets, but that they soon passed beyond the stage of fees into that of imposts. The name customs duties was applied indiffer ently to the taxes levied at ports of entry or at ports of passage or upon goods brought into a city frog surrounding parts of the same country. Such internal customs have almost disappeared in modern countries, though remnants of them are found in the `octroP of Paris and other Con tinental cities. Transit taxes, such as those levied upon the navigation of the Rhine, have also disappeared. Such restrictions upon the freedom of commercial intercourse would no more be tolerated in modern times than the tributes once paid to the Barbary pirates.
Taxes upon exports have become infrequent. They are no longer an element of consequence in the fiscal system of modern States, though a few remnants of them can be found. In South America such taxes arc more common. Chile derives considerable revenue from its nitrate exports, and Brazil from its coffee exports. Quite striking, as a return to older forms of taxation supposed to be laid aside, was the imposition in INT of a tax of one shilling per ton upon all coal exported from Great Britain.
Customs duties are, therefore, generally syn onymous with duties upon imports. Such duties may have no other object than to raise revenue. The most conspicuous case of such a purely fiscal tax is when the imported article is taxed to ex actly the same extent as the home product, such a tax aiming to equalize the conditions of com petition for the foreign and the home producer. Another distinctly fiscal tax is one imposed upon an article not produced in the home country, as the English duty upon tea. Taxes which weigh more heavily upon the foreign article than the home product, or which are levied upon imports where the same article is not taxed at home, may be purely fiscal in intent or may he designed as a protection for home industries. It is not the
magnitude of the taxation which decides this point, hut the effect upon the economie order. It is well understood that any taxation whatever influences consumption and prodnet ion, but this influence may be deliberately planned or in cidental. It is the deliberate planning which characterizes a protective tariff. Whether such a course is to be justified is not to be discussed here. (See FREE TRADE; and TARIFF.) It is enough for our purpose to note that the injec tion into tariff legislation of ulterior economic motives complicates the machinery of customs duties in a high degree. Such a course (b)es not eliminate the fiscal features of a tariff, as there tire few States which can afford to handle their customs taxation in such a way as entirely to subordinate fiscal interests to economic policy.
The contrast between a purely revenue tariff and a protective tariff is illustrated most strik ingly by comparing the United States and Great Britain. In the latter the general principle is freedom from taxation, duties being laid upon a few articles only, twenty-seven iu all. In the United States, the general principle is taxa tion, and all articles not specifically taxed at rates named, or expressly exempt from taxation, are subject to a duty of 10 per cent, if un manufactured and of 20 per cent. if manufac tured in whole or in part. The complicated structure of the American tariff is shown in the following analysis of the tariff act of IS97, show ing the several schedules and the classes of duties imposed by the several paragraphs under each which fix the rates: convenience of administration has produced a general Sentiment in favor of specific duties, but nations pursue an avowedly protectionist pulley cannot yield to this sentiment as largely as those whose tariff is for revenue only. Spe chile duties can best be applied when the product is comparatively uniform in quality and value. In Great Britain, Germany, and Austria, only specific duties prevail, and the tariffs in France and Italy show• very few ad valorem rates.