EU CRITICIZES U.S. HARBOR TAX PROPOSAL

EU CRITICIZES U.S. HARBOR TAX PROPOSAL

    The European Union’s European Commission is the latest body to come out against the Clinton Administration’s proposal to replace the Harbor Maintenance Tax on exports. The tax was declared unconstitutional in March 1998.
    Sir Leon Brittan, vice president of the EC, sent a letter to U.S. Trade Representative Charlene Barshefsky, criticizing the Harbor Services Fund. The proposal would assess a fee on vessel operators, based on size and type of vessel operated.
    The EC said the proposal doesn’t meet legal concerns raised the commission, and objects to the expanded uses of the fund, that it retains exemptions for U.S. domestic interests and that the vessels would be required to pay user fees in ports that do not require dredging.
    The EC also objects that the tax continues to be collected on imports. The commission said it will seek a dispute resolution panel if the collections aren’t stopped by Jan. 1