California Bill Would Tax Containers

California state senator Alan Lowenthal has offered amendments to the state’s Senate Bill 927 that would assess a fee of $30 per twenty-foot-equivalent unit (TEU) for cargo moving through the Ports of Los Angeles and Long Beach. The fee would be assessed against the owner of the cargo.

The Port Congestion Relief Trust Fund would be established to improve the rail system (including on-dock rail facilities), enhance security and mitigate the environmental pollution caused by port operations.

Beginning in January 2007, the port of Los Angeles would be required to develop a process for notifying and collecting fees from the owner of the cargo. No later than June 1, 2007, the port would be required to notify the owner of cargo moving through the port that it will be assessed a user fee not to exceed $30 per TEU and to provide information on the process for payment and the frequency of payment. Then starting January 1, 2008, the port will assess a user fee and collect the fee at least twice a year.

According to the National Industrial Transportation League (NITL), an earlier attempt to enact a container tax bill in 2006 was thwarted when the state legislature’s Appropriations Committee declined to consider that bill S.B. 760. Among the changes Senator Lowenthal made in re-introducing the fees in S.B. 927 was to shift the burden for the fees to the owner of the cargo.

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