HQ 0113056 - Application for Refund of Special Tonnage Tax and Light Money for the Tuvalu Vessel MV CAP PALMAS - United States International Trade Commision Rulings

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HQ 113056

May 31, 1994

VES-11-11 CO:R:IT:C 113056 BEW

CATEGORY: CARRIER

Regional Commissioner of Customs
Northeast Region
Boston, Massachusetts 02222-0156

RE: Application for Refund of Special Tonnage Tax and Light Money for the Tuvalu Vessel MV CAP PALMAS

Dear Sir:

This is in reference to your memorandum dated March 18, 1994, which transmitted documents from Marine Cargo Management, Inc. (MCM), and an application dated January 14, 1994 (copy enclosed), filed by Ernst Jacob for refund of special tonnage tax and light money.

FACTS:

The money was assessed pursuant to section 121 of title 46, United States Code, Appendix (46 U.S.C. App. 121), and section 4.20, Customs Regulations (19 CFR 4.20), upon arrival of the vessel at the ports of Chester, Pennsylvania, Wilmington, Delaware, and Port Manatee, Florida, on the following dates:

DATE AMOUNT
March 30, 1993 $5,590.00
April 13, 1993 $5,590.00
April 27, 1993 $5,590.00
May 13, 1993 $5,590.00
May 26, 1993 $5,590.00
June 8, 1993 $5,590.00
June 22, 1993 $5,590.00
July 6, 1993 $5,590.00
July 20, 1993 $5,590.00
August 5, 1993 $5,590.00
August 17, 1993 $5,590.00
August 31, 1993 $5,590.00
September 14, 1993 $5,590.00
September 28, 1993 $5,590.00
October 12, 1993 $5,590.0o
October 26, 1993 $5,590.00
November 9, 1993 $5,590.00 Special tonnage tax and light money were collected because section 4.22 of the Customs Regulations had not been amended to include Tuvalu.

ISSUE:

May special tonnage taxes and light money assessed against a Tuvalu vessel after the effective date that Tuvalu was added as one of the countries exempt under section 4.22 of the Customs Regulations be refunded when timely application for refund is made.

LAW AND ANALYSIS:

Under 46 U.S.C. App. 121 and 128, a special tonnage tax in the amount of fifty cents per ton and light money in the amount of fifty cents per ton are to be assessed on vessels not built in the United States and not of the United States. However, pursuant to 46 U.S.C. App. 141 (see also final clause of penultimate sentence of 46 U.S.C. App. 121), upon satisfactory proof that no discriminating duties of tonnage or imposts are imposed in the ports of another nation upon United States vessels, "... foreign discriminating duties of tonnage and impost within the United States are suspended and discontinued, so far as respects the vessels of such foreign nation ..." The nations for which such satisfactory proof has been supplied are listed in section 4.22, Customs Regulations (19 CFR 4.22). Tuvalu is now one of those nations.

The Customs Regulations pertaining to tonnage taxes and light money are found in section 4.20-4.24, Customs Regulations (19 CFR 4.20-4.24). The procedures and requirements for obtaining a refund of tonnage taxes and light money are in section 4.24. Under that section, an application for refund must be made within 1 year from the date of payment.

The special tonnage taxes and light money were collected because Tuvalu did not appear on the list of countries exempt from collection of these taxes and light money in section 4.22, Customs Regulations (19 CFR 4.22). Customs places the names of countries on that list upon notification by the United States Department of State that no discriminating duties of tonnage are levied by those countries on vessels of the United States.

Customs was notified on November 16, 1993 and January 27, 1994, that Tuvalu should be added to the list of nations whose vessels are exempted from the assessment of special tonnage taxes, and that the exemption should be made retroactive to January 1, 1993. Prior to amending our regulations to reflect this change, we sent a telegram to all regional commissioners on February 9, 1994, reporting this change, including the retroactive effective date. Subsequent to the effective date of the exemption, the subject vessel made fifteen (15) arrivals at the port of Chester\Wilmington and two (2) arrivals at port Manatee, and paid an amount of $5,590 in special tonnage tax and light money each arrival.

When the owner or agent of a vessel which has been assessed special tonnage taxes and light money timely submits an application and the appropriate documentation to the District Director of Customs for the port where the special tonnage taxes and light money were assessed, the special tonnage taxes and light money may be refunded.

In the subject case the vessel owner, Ernst Jacob in a letter dated January 14, 1993, timely applied for a refund of the special tonnage taxes and light money assessed against the CAP PALMAS when she arrived at the ports of Chester/Wilmington and Port Manatee. In addition to the application for refund filed with your office by Marine Cargo Management, Inc., agent for Ernest Jacob in the Chester case, we have also received an application for refund, (filed with the District Director of Customs, Tampa, Florida), from Manatee Marine Agency, Inc., the vessel agent for Ernest Jacob in the Port Manatee case. The documents submitted revealed that the CAP PALMAS' first arrival was on February 16, 1993, at the port of Chester. On that date, the vessel entered under the name of WALTER JACOB and she was flying a German flag. The documents show that the vessel entered the port of Chester again on March 2, 1993. Regular tonnage taxes in the amount of $503.10 were assessed upon each arrival. On March 18, 1993, she entered the port of Manatee under the name of CAP PALMAS and paid regular tonnage taxes in the amount of $503.10. The vessel changed from the German Flag to the Tuvalu flag on March 30, 1993. When she entered the port of Chester on March 30, 1993, both regular tonnage taxes in the amount of $503.10 and special tonnage taxes and light money in the amount of $5,590 were assessed. On April 13, 1993, she made her fifth entry, and again both regular tonnage taxes and special tonnage taxes and light money were assessed. Subsequent to this entry she made thirteen additional trips to Chester/Wilmington and two trips to Port Manatee. On each arrival special tonnage taxes and light money in the amount of $5,590 were assesed

Based on the evidence in the file, we concur in your recommendation that the special tonnage taxes and light money assessed against the CAP PALMAS be refunded. Accordingly, a refund in the amount of $83,850 should be made through your region to Marine Cargo Management, Inc., c/o Mid-Atlantic Shipping and Stevedore, Inc., 128 Tilbury Road, Salem, New Jersey. By a letter dated today, we are authorizing the Regional Commissioner of Customs, Southeast Region to make a refund of $11,180 to Manatee Marine Agency, Inc. 210 National Street, Palmetto, Florida 34221-6600, an amount representing the special tonnage taxes and light money paid at Port Manatee, Florida. A copy of the additional documents contained in our file is being sent to you for your information. A complete file is being sent to the Regional Commissioner of Customs, Southeast Region for appropriate action.

HOLDING:

Upon the filing of the certificate required in 19 CFR 4.24, special tonnage taxes and light money assessed against a vessel of Tuvalu subsequent to January 1, 1993, should be refunded.

Sincerely,

Stuart P. Seidel

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