Pacific Maritime Magazine - Marine Business for the Operations Sector

By Chris Philips
Managing Editor 

Meaningful Tax Reform

 

April 1, 2018



According to the Washington Public Ports Association, as many as half of US-bound containers coming into Canada’s West Coast ports could revert to using US West Coast ports if importers were not required to pay the harbor maintenance tax. Currently, the amount of collected tax meets all obligations, and this year, the surplus is set to grow to more than nine billion dollars. The majority will be spent on dredging for East Coast, Gulf and other ports. Meanwhile, the ports of Seattle and Tacoma, united under the Northwest Seaport Alliance, require little to no dredging, and only see a penny on each dollar collected from the shippers who utilize these ports.

In early March, Washington Secretary of State Kim Wyman signed Joint Memorial 8008, which outlines the collective agreement of the Washington State House and Senate to reform the harbor maintenance tax.

The measure, sponsored by State Senator Maralyn Chase (D-Shoreline), is aimed at fixing the harbor maintenance tax structure. As it stands, businesses can work around the tax by avoiding US ports, shipping to Mexico or Canada, and transporting goods by rail or road. “This is extremely important to the commerce of our state – that’s why we’re doing this,” remarked Chase.

In January, Senator Chase was selected by the Senate Democratic Caucus to serve as the chair of the Economic Development & Trade Committee for the 2018 Legislative Session. “Economic development and trade are critical industries in our state that must not be ignored,” says Chase, who is also a member of the State Senate Transportation Committee and the Rules Committee.

The memorial asks that Congress pass and the president sign legislation reforming the harbor maintenance tax, and that “…such legislation ensures that United States tax policy does not disadvantage United States ports and maritime cargo, and provides greater equity for harbor maintenance tax donor ports through expanded uses of the harbor maintenance revenues.”

Also on hand were State Representative Mary Dye (R-Pomeroy) and Representative Tom Dent (R-Moses Lake). “It is really important we remain competitive with our foreign ports,” Dent said. “It’s important that our fees remain competitive as these ships come into port. Not to mention, we want to keep our ports viable and operational as well.”

The lawmakers noted that competition for US ports continues to grow. With the recent widening of the Panama Canal, and the potential addition of a canal in Nicaragua, Washington ports need to remain competitive in efficiently getting goods to market.

Mark Johnson on behalf of the Washington Retail Association agrees. “We’re delighted to send this joint memorial back to Congress, we think it is way past due,” he says. “The Northwest Seaport Alliance, the Ports of Seattle and Tacoma, are at an unfair disadvantage on receiving funds to keep our ports safe and available for imports and exports.”

Johnson says the retailers of Washington state import hundreds of millions, if not billions of dollars of products through those ports. “We want to keep it competitive and safe, and we think Congress needs to reform this, so we’re hoping they act after they receive this joint memorial.”

“We have thousands of Washingtonians working every day to provide for their families, their communities, and our state,” Senator Chase says. “We need to ensure that we create a climate that will encourage more economic development and growth in trade. The Economic Development & Trade Committee has always been bipartisan and I plan to continue that collegial, working partnership.”

We couldn’t agree more.

Chris can be reached at chris@pacmar.com

 
 

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