bounty, a
deduction of fifteen per cent was to be made for each year that had
passed. The navigation bounty was fixed at five kreutzers per net ton of
capacity for every hundred nautical miles sailed. The exemption from the
production and income taxes, granted in 1890, was extended for a term of
five years from January 1, 1894. The law was to be in force for ten
years.

As the end of the term of this law was approaching ship-owners began
agitating for its renewal with an increase in the subsidy. Since its
enactment the production of steam tonnage had been accelerated, and the
decline of sail tonnage had been checked; but no marked change in the
merchant marine generally had been manifest.[DH] Of the bounties paid
the Austrian Lloyd had received a large share in behalf of their ships
which were not directly under contract for the mail service. The
remainder went to the various companies controlling the coast and river
trade. The ten to twenty-five per cent addition to the trade bounty for
ships built in domestic yards and from domestic materials, finally went
for the most part to a single large building concern at Trieste. While
most of the Austrian tonnage was yet of foreign build, mostly
constructed in British yards, the increase in the proportion of domestic
build was considerable after 1893. The greater part of the materials
used was Austrian product. Consequently allied industries increased with
this increased output of home ships.[DI]

At length in 1907 (February 23) a new law was enacted increasing the
navigation and construction bounties. For the navigation subsidies, to
go to shipowners according to the tonnage of the ships and the number of
miles run, allotments were thus made: for the first year, $852,600; for
1908, $893,200; 1909, $954,100; 1910, $1,015,000; 1911, $1,075,000; and
for the five years remaining of the term, of the law--which ends
December 31, 1916--$1,136,800 a year. The construction subsidies were
raised as follows: for ships launched after July 1, 1907: steamers built
of iron and steel $8.12 per gross ton, sailing-ships of iron and steel,
$2.84; for marine engines, boilers, pipes, and auxiliary apparatus,
$1.62 per 220.46 pounds. To entitle a ship to these bounties fifty per
cent of the materials used in its construction must be home product.[DJ]

This year (1907) also the annual postal subventions to the Austrian
Lloyd were increased $1,486,586, for a further period of fifteen years.
This