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H.R.3392 Applauded By Maritime Interests
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| Legislation From Rep. Hunter Would Promote Expansion Of U.S. Cruise Fleet | |||
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A bill to encourage additional U.S. cruise fleet expansion has been welcomed by AMO and others. The bill is H.R.3392, introduced Nov.16 by Rep. Duncan Hunter, a Democrat from California. Titled the All American Cruise Act of 1999, H.R.3392 would provide tax incentives to spur private investment in U.S.-built and registered cruise vessels. Such legislation is "critical" if U.S. interests are to share significantly in markets "currently dominated by foreign-built and foreign-crewed ships," commented Charles Crangle, AMO's legislative and Congressional affairs director. Also commenting was the AFL-CIO International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers. Because foreign governments routinely subsidize cruise ship construction, "it is only fair that our shipyards and our skilled workers be given the same breaks as those provided to our competitors," the union said in a statement endorsing H.R.3392. In a letter to Rep. Hunter, American Shipbuilding Association President Cynthia Brown said the measure would help even the competitive plane between U.S. and foreign cruise interests in markets sustained largely by U.S. consumers. H.R.3392 would provide tax credits for the domestic construction of U.S.-flag cruise ships 20,000 gross tons or greater, exempt U.S. cruise ship owners/operators from U.S. corporate income tax, permit accelerated depreciation, allow greater tax deductions for business meetings held aboard U.S.-flag cruise ships, and provide tax credits for the use of clean engines manufactured in the U.S. "This bill will provide American shipbuilders, owners and crews with tax parity with foreign builders and owners of cruise ships that operate almost exclusively from U.S. ports and derive over 90 percent of their income from U.S. citizens," Brown said in her letter to the Congressman. U.S. interests are "at a severe competitive disadvantage in the American cruise ship market" because the U.S. tax code "rewards companies that build and register their ships in foreign countries" and penalizes U.S. companies that "wish to build and register vessels in the U.S.," Brown continued. She pointed out that 120 ocean-going cruise ships now cater to U.S. citizens with regular departures from U.S. ports. "These ships, however, are built in foreign countries where governments provide tax credits and other assistance that equates to as much as a 50-percent reduction in the price of these ships," Brown explained. "The ships in turn are operated by companies that register them in foreign countries to avoid U.S. corporate income tax--by building and operating these ships foreign, these companies avoid America's high environmental, labor, and safety standards in the construction and operation of their ships and jeopardize the lives of American tourists." Brown cited efforts by some in the House and Senate to "surrender the U.S. cruise ship market to these foreign entities" through repeal of the 1886 Passenger Vessel Services Act, which holds all domestic cruise, ferry, excursion, and casino markets for vessels owned, built, registered and manned in the U.S. "Our industry believes there is a better way--your way--which would create an all-American industry built by Americans for Americans," she said. H.R.3392 would "create hundreds of thousands of high technology, highly skilled manufacturing and seagoing jobs for Americans," bolster the U.S. shipbuilding and defense mobilization industrial base, and "ignite a powerful engine that would propel all segments of the U.S. economy toward strong growth and prosperity into the 21st Century," Brown concluded. "American tourists would be assured that they would be vacationing on the safest constructed and operated ships in the world." | |||
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