China Tax, PierPASS Fee to be Topics of FMC Meeting
The Federal Maritime Commission will hold a closed meeting Sept. 18 in Washington, D.C., to discuss the following topics.
Traffic Mitigation Fee. The West Coast Marine Terminal Operators Agreement’s PierPASS Traffic Mitigation Fee is assessed on loaded containers entering or exiting any of the 12 international container terminals at the ports of Los Angeles and Long Beach during peak hours (Monday through Friday, 3:00 a.m. to 6:00 p.m.) to fund the operation of off-peak gate openings, which began in 2005 to address issues such as congestion, security and air quality and now account for 55% of cargo movements. The TMF was raised Aug. 19 to $66.50 per 20-foot equivalent unit or $133.00 per 40-foot equivalent unit and is adjusted annually based on changes in maritime labor costs.
China VAT. The FMC will examine the effect on ocean export freight shipments of a 6% value-added tax China began imposing nationwide effective Aug. 1. Press sources indicate that the VAT is not applied to international ocean freight but is assessed against related activities such as logistics, freight forwarding, customs clearance, warehousing and related services. Nevertheless, said National Industrial Transportation League president Bruce Carlton in a recent letter to the State Department, there are reports that “some ocean carriers and non-vessel operating common carriers (NVOCCs) are simply passing on the tax to their customers in the form of surcharges or service charges even when the freight charges have been ‘pre-paid.’”