The Federal Maritime Commission recently announced an inquiry into the Harbor Maintenance Tax, and the results of that inquiry could result in a major shift in U.S. trade policy.
All foreign cargo that enters the U.S. via our ports pays an ad valorem tax upon entry; goods that enter via a land border are exempt from that fee. That means shippers can send goods through Canadian or, eventually, Mexican ports, send those goods into the country via the land border and reach the same lucrative American markets without paying for the maintenance of our harbors and infrastructure.
It’s a U.S. policy that has tilted the playing field against us: British Columbian ports highlight shippers’ ability to avoid the fee, and shippers are listening. This is not Canadian cargo coming into the country — it’s Asian and European cargo bound for the U.S.
Federal Maritime Commission Chairman Richard Lidinsky’s inquiry into how this policy may be diverting cargo away from U.S. ports may result in a policy that will level that playing field so that U.S. ports can compete for goods based on service and productivity — not a tax loophole.
I am also cautiously optimistic Congress will pass a new Surface Transportation Reauthorization Act. But we must approach investment strategically, spending scarce dollars on projects that generate jobs and economic growth and make goods and people move more efficiently.