Lows the aggregate market cap of the four US-listed cruise companies was down $15.4bn, an average of 10% after a televised Fox interview with US secretary of commerce
SHIPPING has more to worry about than US tariffs that depress future cargo demand. The Trump administration could also push for new taxes on foreign-flag ships calling at US ports.
Harold Lutnick ( 14 July 1961 ) the newly confirmed US secretary of commerce, said during a televised Fox interview on Thursday morning, “Donald Trump has announced the External Revenue Service and his goal is very simple: to abolish the Internal Revenue Service and let all the outsiders pay.
Cruise ships
“I’ll give you an example: cruise ships. You ever see a cruise ship with an American flag on the back? They have flags of Liberia or Panama. None of them pays taxes. Every supertanker — none of them pays taxes. ” This is going to end under Donald Trump,” said Lutnick. “Those taxes are going to be paid.”
Cruise stocks plummeted
Within moments of his comments, cruise stocks plummeted. At their lows on Thursday morning, the aggregate market cap of the four US-listed cruise companies — Carnival, Royal Caribbean, NCL and Viking — was down $15.4bn, an average of 10%.
If there is a new tax on foreign-flag vessel operators carrying US imports and exports, the charterer would pay in the case of tramp trades and the cost would presumably be passed along to the container shipper in the case of liner trades.
If a new US tax reduced margins for shipowners serving US trades, more vessels would theoretically shift elsewhere, reducing competition in US trades and increasing rates paid by cargo shippers, which would in turn be passed along to consumers and exporters.according to Lloyd’s List
On one hand, US commerce secretary Harold Lutnick’s pledge to tax foreign-flag ships could be just talk. On the other, cruise stocks lost $9bn in market cap on Thursday as a result of those comments — and Lutnick also mentioned tankers as Lloyd’s List said
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