Howard Schragin


This Comment argues that the recently decided case of U.S. Shoe should be upheld by the Federal Circuit upon review because allowing the continued imposition of the HMT would adversely affect the U.S. export industry and subject the Government to possible North American Free Trade Agreement (“NAFTA”) violations. Part I provides background information regarding Congress' commerce and taxation powers. Part I also analyzes the constitutional restrictions on taxation and presents the judicial interpretations of the Export Clause and Import-Export Clause. Part I then describes the CIT and how it functions. Next, Part I presents a review of NAFTA and U.S.-Canada trade relations. Finally, Part I introduces background information on the HMT and Harbor Maintenance Trust Fund (“Trust Fund”), and examines the problems surrounding this tax and the disputes leading to the U.S. Shoe holding. Part II analyzes the CIT's decision in U.S. Shoe. Part III argues that U.S. Shoe was correctly decided by the CIT, and that the traditional approach to Export Clause analysis should be upheld and applied in the future. This Comment concludes that U.S. Shoe should be upheld in order to preserve the success of maritime trade between U.S. and Canadian ports, the competitiveness of U.S. ports, and the validity of a well-established Supreme Court precedent.