levied by Great Britain or Germany. During the year 1893 the city of San Francisco levied taxes to the amount of $85,675 on its shipping, a sum within $600 of the combined taxes paid during the same year by the Cunard Line, the Hamburg-American Line, the North German Lloyd, and the Compagnie Générale Transatlantique of France to their respective Governments; their combined shipping comprising upward of 700,000 tons of the best steel and iron steamships valued at upward of $58,000,000. And in addition to this onerous and (in comparison with other countries) discriminating burden of taxation or shipping, the income-tax act of 1894 imposed an additional and new tax of two per cent on the earnings of shipping in excess of $4,000, which would have fallen mainly on that portion of the United States merchant marine—i. e., the great American steamships—which is most exposed to foreign competition, and which it is regarded as especially desirable to nationally foster.
On the other hand, Great Britain, Germany, France, and the Netherlands tax only the earnings of shipping—i. e., an income tax. Austria in 1894 suspended for five years all taxation of its vessels engaged in foreign trade. Under this system of vessel taxation by the great maritime countries of Europe it is, furthermore, to be noted that the ownership of a ship that is idle and not earning does not entail any burden of taxation; but in the United States it makes no difference whether a ship be at work or idle, profitably or unprofitable employed, she pays taxes all the same.
The experience of the several States in respect to the taxation of vessels affords, however, a very striking illustration of the facility with which obnoxious taxes are evaded in the United States, or shifted upon those who are less able to bear them, and is thus related in the Report of the United States Commissioner of Navigation for 1894: "It is relatively an easy matter for the owner of several vessels to form a partnership with the resident of another State in which low taxes are imposed on shipping, and by allowing the vessels to stand in the name of such partner to escape the endeavor of the law to tax him more than his competitors in navigation are taxed. Thus, some years since, the authorities in Chicago decided to tax the shipping owned at that port on its full insurable value at the rate fixed for municipal taxes. The vessel owners of the city, in self-defense and to enable them to continue in business against competing ports, were compelled to make nominal transfers of their property, and thousands of tons of shipping, doubtless owned in Chicago, appear on the records of the National Bureau of Navigation as owned in other States. Though in the number and tonnage of its entries and clearances Chicago ranks with the greatest ports
