Bonded Warehouses.

Bonded Warehouses. The warehousing system is a plan for lessening the pressure of excise or customs duties by postponing payment of them until the goods on which they are levied pass to the consumer, or, at all events, to the retail dealer. A merchant who might import £1000 worth of wine or tobacco if he only paid duty on it by instalments as it went out to the dealer, would be quite unable to import so much if he had to pay heavy duty immediately upon the arrival of his goods. Hence the adoption of the bonded warehouse or warehousing system, which also affords to merchants facilities for free exportation. The taxable commodity is locked up in a 'bonded' warehouse, which has been approved by the Commissioners of Customs or of Inland Revenue. It is under the supervision of the revenue officers from the time it is entered into until it is finally cleared out of the warehouse, and the revenue is further protected by bond given for due exportation or for payment of duty. This bond was formerly entered into by the importer, but the security is now given by the warehouse-keeper. 'Bonding' was part of the scheme of Sir Robert Walpole in 1733, generally known as the 'Excise Scheme,' which was defeated, however, on account of its unpopularity. The system was first authorised for the customs by an Act of George III. in 1802. The excise system of warehousing dates from 1823. In successive years various acts and departmental regulations have been issued, extending or defining the privileges, and in 1882 the excise and customs systems were assimilated, the new code adopting excise methods to a considerable extent. While in the warehouse 'wet' goods—i.e. wines and spirits—may be operated upon by racking, blending, mixing, sweetening, and colouring, under strictly defined conditions. Wines may be refined and fortified. No compensation can be made by the Customs or Inland Revenue authorities to any importer or proprietor of goods by reason of any damage occasioned in the warehouse by fire or any other accident. The warehousing system has also, by retaining the goods for the owner, whoever he may be, created a complete system of paper-money in the transference of the title-deeds, as they may be called, of such goods—the dock-warrants or other documents—the possession of which is equivalent to possession of the goods.