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Date Posted: 02:22:24 10/23/06 Mon
Author: Don Johnson
Subject: U.S. navigable waters

I believe Idaho stopped requiring the payment of their sales tax in
January 2003, because of the federal law (Title 33, Section 5b, United States Code).
Title 33, Sec 5b appears to prohibit all states from taxing activities that occur on
all U.S. navigable waters, in any state.
There appears to only be four Title 33 exceptions to this Title 33, Section 5b ban.
Those exceptions are:
(1) fees charged under section 2236 of this title; or
(See Below --> § 2236. Port or harbor dues.)
(2) reasonable fees charged on a fair and equitable basis that--
(A) fees used to pay the cost of a service to the vessel or water craft;
(B) fees to enhance the safety and efficiency of interstate and foreign commerce.
(C) fees that do not impose more than a small burden on interstate or foreign commerce.

The only exception that I can see the Kenai Peninsula Borough attempting to
claim would be that it's "Kenai River Navigable Waters Sales Tax" does not
impose more than a small burden on interstate or foreign commerce.
The KPB collects millions of dollars from it's "Kenai River Sales Tax" and
that tax appears to be much more than a small burden on interstate or foreign commerce.
It appears to be necessary to define the words "small burden" to fully understand
this exception.
----------------------------------------------------------------------------
Section 2236 defines reasons non-Federal interest may levy port or harbor dues.
These dues involve entering or departing from a harbor and loading or unloading
cargo from a vessel.
These fees also may include the financing of the non-Federal share of construction,
operation and maintenance of a navigation project.
These fees may include providing emergency response services in a harbor,
including contingency planning, necessary personnel training, and the
procurement of equipment and facilities.
I believe that none of these elements are involve within it's current KPB
navigable waters sales tax.
------------------------------------------------------------------------------------------
It may be possible for the Kenai Peninsula Borough to claim that it uses some small
part of its current navigable waters sale tax for one or more Section 2236 purposes
but in general, the KPB sales tax is officially listed as being used to finance
KPB schools.
USC Title 33, Section 5b does not allow funds collected upon U.S. navigable waters
to be used to pay for anything other than those listed within its four exceptions.

It appears that using these "KPB, Kenai River Navigable Waters Fees" for any
reason other the four listed exceptions, is specifically illegal.
It also appears that Alaska should have stopped taxing it's navigable waters like
Idaho back in January 2003, but it failed to do so. This failure of the KPB
legal department, has therefore exposed the KPB to repaying the sales taxes
it has collected since January 2003.
The KPB collects approximately a couple of million dollars per year and that would
equate to close to a $8,000,000 KPB navigable waters sales tax refund.

Don Johnson
ccpwow@gci.net

REFERENCES BELOW:
TITLE 33--NAVIGATION AND NAVIGABLE WATERS
--------------
FEDERAL LAWS CREATE SALES TAX EXEMPTIONS.
------------
The Idaho Outfitters and Guides Association May 2005 - FYI.
--------
§ 2236. Port or harbor dues.
--------
VOLUME SEVENTEEN - NUMBER ONE JUNE 2005- Tax Update deals
with Idaho’s new sales tax rate and new tax laws.
---------
TITLE 49 > SUBTITLE VII > PART A > subpart i > CHAPTER 401 > § 40116
§ 40116. State taxation, 40116. State taxation - individual traveling in air commerce.
--------



-------------------------------------------------------------------------------------------------------------------------
TITLE 33--NAVIGATION AND NAVIGABLE WATERS
CHAPTER 1--NAVIGABLE WATERS GENERALLY
SUBCHAPTER I--GENERAL PROVISIONS


Sec. 5. Abolition of tolls on Government canals, canalized
rivers, etc.; expense of operation, repairs to and
reconstruction of canals, etc.; Panama Canal excepted; levies by
non-Federal interest
CHAPTER 1--NAVIGABLE WATERS GENERALLY
SUBCHAPTER I--GENERAL PROVISIONS



Sec. 5. Abolition of tolls on Government canals, canalized
rivers, etc.; expense of operation, repairs to and
reconstruction of canals, etc.; Panama Canal excepted; levies by
non-Federal interest,

(b) No taxes, tolls, operating charges, fees, or any other impositions whatever shall be levied
upon or collected from any vessel or other water craft, or from its passengers or crew, by any non-Federal
interest, if the vessel or water craft is operating on any navigable waters subject to the authority of
the United States, or under the right to freedom of navigation on those waters, except for --
(1) fees charged under section 2236 of this title; or
(See Below --> § 2236. Port or harbor dues.) ********************************
(2) reasonable fees charged on a fair and equitable basis that--
(A) are used solely to pay the cost of a service to the
vessel or water craft;
(B) enhance the safety and efficiency of interstate and
foreign commerce; and
(C) do not impose more than a small burden on interstate or
foreign commerce.


-----------------------------------------------

TITLE 33--NAVIGATION AND NAVIGABLE WATERS
CHAPTER 1--NAVIGABLE WATERS GENERALLY
SUBCHAPTER I--GENERAL PROVISIONS


Sec. 5. Abolition of tolls on Government canals, canalized
rivers, etc.; expense of operation, repairs to and
reconstruction of canals, etc.; Panama Canal excepted; levies by
non-Federal interest

(a) No tolls or operating charges whatever shall be levied upon or
collected from any vessel, dredge, or other water craft for passing
through any lock, canal, canalized river, or other work for the use and
benefit of navigation, now belonging to the United States or that may be
hereafter acquired or constructed; and for the purpose of preserving and
continuing the use and navigation of said canals and other public works
without interruption, the Secretary of the Army, upon the recommendation
of the Chief of Engineers, United States Army, is authorized to draw his
warrant or requisition, from time to time, upon the Secretary of the
Treasury to pay the actual expenses of operating, maintaining, and
keeping said works in repair, which warrants or requisitions shall be
paid by the Secretary of the Treasury out of any money in the Treasury
not otherwise appropriated: Provided, That whenever, in the judgment of
the Secretary of the Army, the condition of any of the aforesaid works
is such that its entire reconstruction is absolutely essential to its
efficient and economical maintenance and operation as herein provided
for, the reconstruction thereof may include such modifications in plan
and location as may be necessary to provide adequate facilities for
existing navigation: Provided further, That the modifications are
necessary to make the reconstructed work conform to similar works
previously authorized by Congress and forming a part of the same
improvement, and that such modifications shall be considered and
approved by the Board of Engineers for Rivers and Harbors and be
recommended by the Chief of Engineers before the work of reconstruction
is commenced: And provided further, That nothing contained in this
section shall be held to apply to the Panama Canal.
(b) No taxes, tolls, operating charges, fees, or any other
impositions whatever shall be levied upon or collected from any vessel
or other water craft, or from its passengers or crew, by any non-Federal
interest, if the vessel or water craft is operating on any navigable
waters subject to the authority of the United States, or under the right
to freedom of navigation on those waters, except for--
(1) fees charged under section 2236 of this title; or

(See Below --> § 2236. Port or harbor dues.) ********************************
(2) reasonable fees charged on a fair and equitable basis that--
(A) are used solely to pay the cost of a service to the
vessel or water craft;
(B) enhance the safety and efficiency of interstate and
foreign commerce; and
(C) do not impose more than a small burden on interstate or
foreign commerce.



---------------------------------------------------------------------------------------------------------------------

FEDERAL LAWS CREATE SALES TAX EXEMPTIONS
As of January 2003, a federal law (Title 33, Section 5b, United States Code)
prohibited Idaho from taxing activities that occur on navigable waters in Idaho.
These activities include river rafting trips and lake cruises.
Businesses selling these kinds of services are not required to collect sales
tax from their customers.
This exemption doesn’t apply to the selling and leasing of boats.
Also, the exemption doesn’t apply to sales of tangible personal
property. When a business operating on navigable waters
keeps an inventory of gear (such as ground sheets, sleeping bags,
boots, rain gear, fishing equipment, and dry bags) exclusively for rental
to clients, it can buy the gear without paying tax only if the equipment is
listed as a separate line item on the client’s invoice, and sales tax is
charged to the client. If a business provides gear to clients as a part
of a package fee, the business must pay tax when it buys the
gear. It will not charge sales tax on the rental.
(see Idaho Sales Tax Rule 047.11.c).
Meals and beverages provided by a business operating on navigable waters
are not subject to sales tax unless the items are separately stated on the invoice.

Also, Idaho can no longer charge sales tax for flying services such as recreational
flights and intrastate charters due to another law passed by Congress
(Title 49, Section 40116, United States Code).
Recreational flights include balloon rides, sightseeing,
wildlife viewing, and similar activities.
Intrastate charters occur when someone hires an aircraft with a pilot to transport
passengers or freight, and the flight begins and ends in Idaho.
-------------------------------------------------------------------------------------------------------------------


-------------------------------
The Idaho Outfitters and Guides Association
May 2005 - FYI

For Your Information (FYI bulletins are sent both electronically and by regular mail.
For more information on the FYI contact either IOGA executive director Grant Simonds
at gsimonds@cableone.net (208.343.9548) or IOGA office manager Jane Bruesch
at idoutfitt@cableone.net (208.342.1438).
The new study regarding the 2005 Economic Value of Fishing and Boating to Visitors and
Communities Along the Upper Snake River is now available on our Data Center site,
courtesy of Vicki Kellerman. FULL STORY
Rep. Mike Simpson's new Boulder-White Clouds wilderness bill includes more wilderness,
more money and lands for local governments, and a new motorized recreation park near Boise.
The Idaho Republican introduced his new bill Thursday with continuing opposition from
motorized recreation groups and some environmental groups.
Other groups including The Wilderness Society, the Sawtooth Society and the Idaho
Conservation League expressed support for Simpson's efforts to craft a compromise that
would preserve 300,011 acres in central Idaho as wilderness, where motorized use is banned.
Questions and Answers regarding recent Idaho Sales Tax Commission Memo of April 27,
2005 that says that outfitters operating on navigable waters no longer have
to collect sales tax. For a copy of the April 27 memo, contact Grant Simonds
at gsimonds@cableone.net.
"Questions from Al Bukowsky, Vice President River Section, Idaho Outfitters
and Guides Association
"Answers from Saul Cohen, Tax Policy Specialist, Idaho State Sales Tax Commission
1. Outfitters have several, if not, many questions. Chief among them....
Is this really true? What does "effective immediately" mean regarding
outfitters paying April sales tax to State? Do they pay for a portion of
April, all of April or.....?
It is true for the Idaho State Tax Commission. Our legal and policy staff have concluded
that the federal statute referred to as the Maritime Transportation Security Act of 2002
prevents the state from taxing river and lake trips or excursions. As you know,
outfitter fees to their customers often consist of many parts, but separately stated
fees identified as a cost to customers for fishing, floating, river running or otherwise being
transported on a lake or river is not subject to tax. We believe November 25, 2002 to
be the first date when such a service is not taxable in Idaho.
2. We offer a trip in the summer which is a combination 3-day
pack trip and 2-day River fishing trip. In this case is the land based portion taxable and the
fishing/floating portion non-taxable income?
The federal preemption only applies to the river and/or lake portion of the trip. Land-based trips
for the purpose of recreation (e.g., hunting, fishing, sightseeing, hiking) are taxable and that
portion should be separately stated on customer invoices.
3. If I collected sales tax on April trips, it would normally be paid by May 20th. Do I pay it to
the state for April services which I collected the tax or refund it to my clients?
Taxes collected by outfitters and other sellers from their customers are the property of the state.
You should remit the tax to the state or return it to your customers if you have not remitted it.
It is advisable to keep records of refunds because of your responsibility for taxes you collect.
4. How do we report mixed income? For example, we have some land based trips and some
river based fishing trips....
will the river trip gross revenue be listed as "non-taxable income"?
Perhaps you are referring to Total Sales, Non-Taxable Sales, and Net Taxable Sales,
which are the first few lines of the state's sales tax, return. There are no precise rules for reporting.
You may find it easier to list total revenue as Total Sales and determine your Net Taxable Sales
by dividing the collected tax by the tax rate. Non-Taxable sales will be the difference between
the two numbers. Example: Total sales are $10,000 and tax collected is $480. $480 divided
by the .06 tax rate equals $8,000 in net taxable sales. Therefore, non-taxable sales are
$10,000 minus $8,000 or $2,000.
5. What about the client who has already paid the outfitter for a service that has not happened?
Apparently, outfitters do not all do the same thing in terms of when they pay the
State the sales tax. Some, apparently don't pay it until the trip happens, others pay it as
they receive the income.
For a monthly filer of sales tax, the tax is due on the filing due date of the month following
the trip. Sales tax is not payable on a cash basis. That is, it is due the month following the sale,
whether the tax has been collected or not. If an outfitter has collected tax on a service or trip
that has not been provided, he/she can return it to the customer as long as he/she keeps
reasonable documentation to account for the tax in that manner. My answers to some of your
other questions cover those cases where the outfitter has collected and remitted the tax for a
trip that has not yet taken place.
6. What about the client who chartered a trip, say last year, paid for the trip in its entirety,
yet the trip is still to happen this summer/fall? Is this client due a refund on the sales tax
from the State if the outfitter already paid the tax?
An outfitter may refund the tax to the customer and take a credit for the refunded tax on the
next sales tax return. Taking a credit (line 7 of the return) requires some proof that the refund
was made. An invoice showing the customer's name, address, the taxable charges and the tax,
as well as a copy of the check, will be sufficient. Or, you may inform the customer that he/she
can receive a refund from the Tax Commission. Have the person call us for details on how
to do this. If you wish to be a bit more helpful in the refund process, you can follow the
procedures in #7 below.
7. Is this retroactive? If so, how does the outfitter or customer obtain a refund that was paid
previously in say 2003/04?
For tax that has been paid to the Commission by outfitters, the outfitters can refund the tax
to customers and then apply to the Commission for a refund. I have attached Form TCR for
this purpose. You can make copies of this form and it can be found on our web site at: http://tax.idaho.gov/pdf/1998/TCR.PDF The outfitter will need to provide proof that sales occurred,
that he remitted the tax, and later refunded to the customer. Alternatively, the customer may apply
for a refund directly from the Commission by providing the appropriate documentation.
To be helpful to your customers, you can send them legible copies of their invoices and a copy
of Form TCR.
8. Do we return the sales tax money to our customers after we run the trip in 2005, if we have
not paid the state? I assume we do not return the money before we run the trips this summer.
For any tax that you have collected but have not remitted, you may refund it to your customers
and keep adequate records to show what you did with the taxes. You can do so as soon as
you are able. Since the customer could apply for a refund anytime, it is best that you make
that refund as soon as it is practical.
9. Since the letter from the state tax commission stating that outfitters no longer had to pay
sales tax was not signed does that still make it binding?
While the memo was not signed, it has value and the Commission will not deny that it has
issued it. If you will permit me a point of clarification, outfitters are no longer required to collect
sales tax from customers. It is the customer who is not required to pay sales tax. It is an
important distinction, as sales tax is payable by the customer to an outfitter who acts in a
position of trust to safeguard the state's money and account for it properly.
10. Are river rescue courses subject to sales tax? Are travel costs that are packaged with river
trips subject to tax (flights from Boise to river and back/ground transport)?
I am guessing that river rescue courses involve the training of individuals to save swimmers or
those who fall from boats, rafts and the like. Charges for this instruction is not taxable even
though it involves trainees and staff using river-going vessels. Charges for the training will not
be taxable. If the provider of training rents lifejackets and other equipment to the participants,
he/she should collect tax on those separately stated charges. If the provider needs to buy
or rent vessels to provide the training, the provider should pay a tax on the purchase or rentals.
Another federal law prevents the state from taxing air travel. The charter flight provider should
not tax you, and you should not charge a tax when you pass along these costs to your customers.
11. What about rentals? (sleeping bag/pads, etc.)
Any item that you separately state as rented to a customer requires that you collect tax.
Here is a summary of some of the more common situations. If an outfitter takes people
aboard river or lake-going vessels, he/she is the user of that vessel and should pay a tax on it.
If an outfitter rents boats or other vessels to customers for their use, he should collect on the
rental charges. The outfitter can buy rafts and boats that will be rented to customers exempt
from tax because the outfitter resells them in the form of a taxable rental.
Gear that is used on or off a boat can be viewed in two ways. If the outfitter provides the gear
(e.g., lifejacket) as part of the trip package, outfitter should pay a tax when he buys the gear.
If the gear will be separately stated as a rental on the invoice, the outfitter can buy the gear
tax exempt for resale and charge a tax for each rental. Outfitters can buy food exempt from
tax and charge a tax when they serve it to customers. Or, the outfitter can pay tax on the food
and include the cost in the overall price it charges customers for the trip. No tax will be collected.
Summary: Some of the questions overlapped. Here is a summary of the common occurrences
and how you can deal with them. An outfitter collected a tax for a river excursion after
November 25, 2002 and paid the state. The customer asks you for a return of the tax.
With adequate proof (a dated, legible invoice that contains tax for the river portion of the service)
you can return the tax to the customer and take a credit against your next sales tax return to
the state. If you are no longer making sales tax reports to the state because the season is
over, or for any other reason, you may return the tax to the customer and file a Form TCR
with the state for a refund. You will need proof that you collected and remitted a tax and later
returned it to your customer. Alternatively, you can ask that the customer apply directly to
the state for a refund, using the instructions provided above. An outfitter collected a tax for a
trip and has not paid the state, but the trip has not taken place yet.
You can return the tax to the customer and kept records showing you have done so.
An outfitter collected a tax for a trip and paid the state, but the trip has not taken place yet.
You can return the tax to the customer and kept records showing you have done so.
Apply for a refund through your sales tax return, using the procedures outlined above.
IOGLB posts Controlled Hunt Information on website. Pages 33 and 51 of the IDFG
Big Game Seasons Rules for 2005 has new information for hunters contemplating submitting
an application for an outfitter allocated controlled deer or elk hunt. The IOGLB has just
posted a list of controlled hunt outfitters with allocated tags along with a sample agreement.
Check these out here
http://www.ioga.org/iogamayfyi2005.aspx
**************************************************
VOLUME SEVENTEEN - NUMBER ONE JUNE 2005
FEDERAL LAWS CREATE SALES TAX EXEMPTIONS
This issue of Tax Update deals with Idaho’s new sales tax rate and new tax laws. If you have questions about this material or if you need more information, contact the Idaho State Tax Commission. SALES TAX REVERTS TO 5% IN JULYIdaho’s sales tax rate will return to 5% on July 1, 2005. This date marks the end of a two-year tax rate increase approved by the Idaho Legislature. Here are answers to questions retailersmight have about how the change affects their business.When do I begin charging the 5% rate? Charge the 5% rate onsales made on or after July 1. If your customer takes possession ofthe goods before July 1, charge the tax at the 6% rate and report iton the sales tax return for that month, even if you haven’t yetcollected the money from the transaction. Are the same sales taxable at the 5% rate? Yes. The same types of sales that were taxable at the6% rate will be taxable at the 5% rate.What about use tax? Pay use tax at the 5% rate if the item isfirst used, consumed, or stored in Idaho on or after July 1, 2005.You owe use tax if sales tax was not paid when the item waspurchased, and no exemption applies.How can I prepare for the 5% rate? Change your cash registerto charge the 5% rate beginning July 1, or use the 5% bracket chartwe are sending to all sales tax account holders to compute thecorrect amount of tax. Keep records that clearly show themonth each sale takes place.Will my sales tax returns show the 5% rate? Your returnswill reflect the 5% rate starting in July. For annual filers who receivetheir returns in December, the returns will have two columns:one for sales made at the 6% rate before July 1, and another forsales made at the 5% rate on or after July 1.What if I collect the sales tax at the 6% rate on or after July 1?If you are still collecting tax at the 6% rate after that date, you mustrefund the 1% difference to your customers. If you can’t locate acustomer, you must pay the difference to the Tax Commission.Do exemption certificates (ST-101) need to be renewed?No. If the information on a certificate is correct, it will remainvalid.What about bracket charts for retailers who also collect thelocal option sales tax? If you collect a local option sales tax forNez Perce or Kootenai County, we will send you a 5.5% (5% state,plus .5% county) bracket chart with your next local option salestax return.A law passed by the Idaho Legislature gives tax benefits toemployers who bring new jobs to Idaho. Under the Small EmployerIncentive Act (House Bill 323a), employers must create at least 10new administrative jobs that provide benefits and pay at least$40,000 annually, and invest at least $50,000 per new employee ina new administrative facility within a 5-year period starting onJanuary 1, 2005. Also, the majority of the taxpayer’sadministrative services must be handled at the facility.The Act provides qualifying employers an additional .75%investment tax credit for a total credit of 3.75%, a 2.5% realproperty improvement income tax credit, an increased new jobscredit for increased wages, and sales tax rebates for 25% of allsales and use taxes paid for headquarters and administrativefacilities constructed, located, or EMPLOYERS CAN GET TAX BENEFITScontinued, back page FEDERAL LAWS CREATE SALES TAX EXEMPTIONSAs of January 2003, a federal law (Title 33, Section 5b, United States Code) prohibited Idaho from taxing activities that occur on navigable waters in Idaho. These activities include river rafting trips and lake cruises. Businesses selling these kinds of services are not required to collect sales tax from their customers.This exemption doesn’t apply to the selling and leasing of boats.Also, the exemption doesn’t apply to sales of tangible personalproperty. When a business operating on navigable waterskeeps an inventory of gear (such as ground sheets, sleeping bags,boots, rain gear, fishing equipment, and dry bags) exclusively for rental to clients, it can buy the gear without paying tax only if the equipment is listed as a separate line item on the client’s invoice, and sales tax ischarged to the client. If a business provides gear to clients as a partof a package fee, the business must pay tax when it buys thegear. It will not charge sales tax on the rental. (see Idaho Sales Tax Rule 047.11.c). Meals and beverages provided by a business operating on navigable waters are not subject to sales tax unless the items are separately stated on the invoice. Also, Idaho can no longer charge sales tax for flying services such as recreational flights and intrastate charters due to another law passed by Congress (Title 49, Section 40116, United States Code). Recreational flights include balloon rides, sightseeing,wildlife viewing, and similar activities. Intrastate charters occur when someone hires an aircraft with a pilot to transportpassengers or freight, and the flight begins and ends in Idaho. To apply for a refund of sales tax paid in error, businesses mustfirst reimburse the tax to their customers. They can then applyto the Tax Commission for a rebate using Form TCR Sales TaxRefund Claim (available on our Web site at tax.idaho.gov/ forms_misc.htm) and send it with their sales tax return. They must apply for the refund within three years of the date they paid the tax to the Tax Commission and provide proof that they reimbursed their customers. Customers who can’t get a refund from the retailer may apply directly to the Tax Commission.Unless otherwise noted, information in Tax Update appliesonly to Idaho taxes. This newsletter is designed to providegeneral information only, and is not intended to offer comprehensive explanations of Idaho tax laws and rules. Send comments about Tax Update to:TAX UPDATE EDITOR COMMUNICATIONS & OUTREACHSTATE TAX COMMISSION PO BOX 36 • BOISE ID 83722Web site: tax.idaho.govPhone (Boise area): 334-7660Phone (toll free): 800-972-7660Hearing impaired: 800-377-3529FOR MORE INFORMATIONTAX COMMISSION OFFICESBoise:800 Park Blvd., Plaza IV Idaho Falls:150 Shoup Ave., Ste. 16 Lewiston:1118 F Street Pocatello:611 Wilson St., Ste. 5 Twin Falls:1038 Blue Lakes Blvd., Ste. C Coeur d’Alene:1910 Northwest Blvd., Ste. 100CIGARETTE TAX HIKE STAYSThe tax on a pack of 20 cigarettes will remain 57 cents in Idaho under a new law (HouseBill 386a) that makes the current cigarette tax rate permanent as ofJuly 1, 2005. The tax rate was scheduled to go back to 28 centsuntil the law was passed. installed within the project site ina 5-year period starting onJanuary 1, 2005. The law also allows local county commissioners to grant a property tax exemption on all or part of theemployer’s new property investment. Administrative jobs mayinclude accounting, data processing, information technology,payroll, personnel, purchasing, tax, and treasury. A facilityincludes office equipment, parking lots, and computers. Realproperty improvements include improvements to buildings,structural components, and parking lots. continued, next columnEMPLOYERS — TAX BENEFITS EPB00032 http://tax.idaho.gov/pdf/publications/EPB00032_TaxUpdate0605.pdf#search='sales%20tax%20navigable%20waters'

TITLE 33 > CHAPTER 36 > SUBCHAPTER II > § 2236 § 2236. Port or harbor dues (a) Consent of Congress Subject to the following conditions, a non-Federal interest may levy port or harbor dues (in the form of tonnage duties or fees) on a vessel engaged in trade entering or departing from a harbor and on cargo loaded on or unloaded from that vessel under clauses 2 and 3 of section 10, and under clause 3 of section 8, of Article 1 of the Constitution: (1) Purposes Port or harbor dues may be levied only in conjunction with a harbor navigation project whose construction is complete (including a usable increment of the project) and for the following purposes and in amounts not to exceed those necessary to carry out those purposes: (A) (i) to finance the non-Federal share of construction and operation and maintenance costs of a navigation project for a harbor under the requirements of section 2211 of this title; or (ii) to finance the cost of construction and operation and maintenance of a navigation project for a harbor under section 2232 or 2233 of this title; and (B) provide emergency response services in the harbor, including contingency planning, necessary personnel training, and the procurement of equipment and facilities. (2) Limitation on port or harbor dues for emer­gency service Port or harbor dues may not be levied for the purposes described in paragraph (1)(B) of this subsection after the dues cease to be levied for the purposes described in paragraph (1)(A) of this subsection. (3) General limitations (A) Port or harbor dues may not be levied under this section in conjunction with a deepening feature of a navigation improvement project on any vessel if that vessel, based on its design draft, could have utilized the project at mean low water before construction. In the case of project features which solely— (i) widen channels or harbors, (ii) create or enlarge bend easings, turning basins or anchorage areas, or provide protected areas, or (iii) remove obstructions to navigation, only vessels at least comparable in size to those used to justify these features may be charged under this section. (B) In developing port or harbor dues that may be charged under this section on vessels for project features constructed under this subchapter, the non-Federal interest may consider such criteria as: elapsed time of passage, safety of passage, vessel economy of scale, under keel clearance, vessel draft, vessel squat, vessel speed, sinkage, and trim. (C) Port or harbor dues authorized by this section shall not be imposed on— (i) vessels owned and operated by the United States Government, a foreign country, a State, or a political subdivision of a country or State, unless engaged in commercial services; (ii) towing vessels, vessels engaged in dredging activities, or vessels engaged in intraport movements; or (iii) vessels with design drafts of 20 feet or less when utilizing general cargo and deep-draft navigation projects. (4) Formulation of port or harbor dues Port or harbor dues may be levied only on a vessel entering or departing from a harbor and its cargo on a fair and equitable basis. In formulating port and harbor dues, the non-Federal interest shall consider— (A) the direct and indirect cost of construction, operations, and maintenance, and providing the facilities and services under paragraph (1) of this subsection; (B) the value of those facilities and services to the vessel and cargo; (C) the public policy or interest served; and (D) any other pertinent factors. (5) Notice and hearing (A) Before the initial levy of or subsequent modification to port or harbor dues under this section, a non-Federal interest shall transmit to the Secretary— (i) the text of the proposed law, regulation, or ordinance that would establish the port or harbor dues, including provisions for their administration, collection, and enforcement; (ii) the name, address, and telephone number of an official to whom comments on and requests for further information on the proposal are to be directed; (iii) the date by which comments on the proposal are due and a date for a public hearing on the proposal at which any interested party may present a statement; however, the non-Federal interest may not set a hearing date earlier than 45 days after the date of publication of the notice in the Federal Register required by subparagraph (B) of this paragraph or set a deadline for receipt of comments earlier than 60 days after the date of publication; and (iv) a written statement signed by an appropriate official that the non-Federal interest agrees to be governed by the provisions of this section. (B) On receiving from a non-Federal interest the information required by subparagraph (A) of this paragraph, the Secretary shall transmit the material required by clauses (i) through (iii) of subparagraph (A) of this paragraph to the Federal Register for publication. (C) Port or harbor dues may be imposed by a non-Federal interest only after meeting the conditions of this paragraph. (6) Requirements on non-Federal interest A non-Federal interest shall— (A) file a schedule of any port or harbor dues levied under this subsection with the Secretary and the Federal Maritime Commission, which the Commission shall make available for public inspection; (B) provide to the Comptroller General of the United States on request of the Comptroller General any records or other evidence that the Comptroller General considers to be necessary and appropriate to enable the Comptroller General to carry out the audit required under subsection (b) [1] of this section; (C) designate an officer or authorized representative, including the Secretary of the Treasury acting on a cost-reimbursable basis, to receive tonnage certificates and cargo manifests from vessels which may be subject to the levy of port or harbor dues, export declarations from shippers, consignors, and terminal operators, and such other documents as the non-Federal interest may by law, regulation, or ordinance require for the imposition, computation, and collection of port or harbor dues; and (D) consent expressly to the exclusive exercise of Federal jurisdiction under subsection (c) [1] of this section. (b) Jurisdiction (1) The district court of the United States for the district in which is located a non-Federal interest that levies port or harbor dues under this section has original and exclusive jurisdiction over any matter arising out of or concerning, the imposition, computation, collection, and enforcement of port or harbor dues by a non-Federal interest under this section. (2) Any person who suffers legal wrong or is adversely affected or aggrieved by the imposition by a non-Federal interest of a proposed scheme or schedule of port or harbor dues under this section may, not later than 180 days after the date of hearing under subsection (a)(5)(A)(iii) of this section, commence an action to seek judicial review of that proposed scheme or schedule in the appropriate district court under paragraph (1). (3) On petition of the Attorney General or any other party, that district court may— (A) grant appropriate injunctive relief to restrain an action by that non-Federal interest violating the conditions of consent in subsection (a) of this section; (B) order the refund of any port or harbor dues not lawfully collected; and (C) grant other appropriate relief or remedy. (c) Collection of duties (1)  2 Delivery of certificate and manifest (A) Upon arrival of vessel Upon the arrival of a vessel in a harbor in which the vessel may be subject to the levy of port or harbor dues under this section, the master of that vessel shall, within forty-eight hours after arrival and before any cargo is unloaded from that vessel, deliver to the appropriate authorized representative appointed under subsection (a)(6)(C) of this section a tonnage certificate for the vessel and a manifest of the cargo aboard that vessel or, if the vessel is in ballast, a declaration to that effect. (B) Before departure of vessel The shipper, consignor, or terminal operator having custody of any cargo to be loaded on board a vessel while the vessel is in a harbor in which the vessel may be subject to the levy of port or harbor dues under this section shall, within forty-eight hours before departure of that vessel, deliver to the appropriate authorized representative appointed under subsection (a)(6)(C) of this section an export declaration specifying the cargo to be loaded on board that vessel. (d) Enforcement At the request of an authorized representative referred to in subsection (a)(6)(C) of this section, the Secretary of the Treasury may: (1) withhold the clearance required by section 91 of title 46, Appendix for a vessel if the master, owner, or operator of a vessel subject to port or harbor dues under this section fails to comply with the provisions of this section including any non-Federal law, regulation or ordinance issued hereunder; and (2) assess a penalty or initiate a forfeiture of the cargo in the same manner and under the same procedures as are applicable for failure to pay customs duties under the Tariff Act of 1930 (19 U.S.C. 1202 et seq.) if the shipper, consignor, consignee, or terminal operator having title to or custody of cargo subject to port or harbor dues under this section fails to comply with the provisions of this section including any non-Federal law, regulation, or ordinance issued hereunder. (e) Maritime Lien Port or harbor dues levied under this section against a vessel constitute a maritime lien against the vessel and port or harbor dues levied against cargo constitute a lien against the cargo that may be recovered in an action in the district court of the United States for the district in which the vessel or cargo is found.
http://www4.law.cornell.edu/uscode/html/uscode33/usc_sec_33_00002236----000-.html


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VOLUME SEVENTEEN - NUMBER ONE JUNE 2005
This issue of Tax Update deals with Idaho’s new sales tax rate and new tax laws.
If you have questions about this material or if you need more information,
contact the Idaho State Tax Commission.

SALES TAX REVERTS TO 5% IN JULY
Idaho’s sales tax rate will return to 5% on July 1, 2005.
This date marks the end of a two-year tax rate increase approved
by the Idaho Legislature. Here are answers to questions retailers
might have about how the change affects their business.
When do I begin charging the 5% rate? Charge the 5% rate on
sales made on or after July 1. If your customer takes possession of
the goods before July 1, charge the tax at the 6% rate and report it

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