1924-05-23

Mr. C. A. GAUVREAU:: (Temiscouata)
presented the second report of the Joint Committee on Printing.



UNITED CHURCH OF CANADA

[Stage Direction]
Mr. FI N. McCREA (Sherbrooke): I wish to present a petition signed by W. B. McCaw and 59 others, members of St. Andrew's Presbyterian church of Sherbrooke, protesting against church union.

Mr. W. F. KAY (Missisquoi) moved:: That the last annual report of the Department of Agriculture be referred to the select standing Committee on Agriculture and Colonization.


Mr. SPEAKER:: By unanimous consent.


[Stage Direction]
Motion agreed to.


[Stage Direction]
Bill No. 123 (from the Senate), for the relief of Nora Pearce.-Mr. Boys.
2466	COMMONS
Ways and Means-Customs Tariff
Bill No. 124 (from the Senate), for the relief of Albert Francis Ray.-Mr. Garland (Carleton).
Bill No. 125 (from the Senate), for the relief of Irene Mildred Jeffrey.-Mr. Boys.
Bill No. 126 (from the Senate), for the relief of Florence Mitchell.-Mr. Martell.

Right Hon. W. L. MACKENZIE KING (Prime Minister):: In the absence of the
Minister of Labour (Mr. Murdock) I beg to move the resolution standing in his name on the order paper, as follows:
Resolved that it is expedient that a certain draft convention which was adopted at the first session of the International Labour Conference of the League of Nations, in 1919, limiting the hours of work in industrial undertakings to eight in the day and forty-eight in the week, be referred to the select committee on Industrial and International Relations for examination and report, having regard to the labour provisions of the treaties of peace and to the order in council of November 6, 1920, dealing with the jurisdiction of the Dominion parliament and the provincial legislatures.


[Stage Direction]
Motion agreed to.
REPORTED MOVEMENT TO BOLIVIA On the Orders of the Day:
Mr. WILLIAM IRVINE (East Calgary):: I would like to ask if the government are aware that a large number of Alberta farmers who were under contract to purchase land from the Canadian Pacific Railway Company, finding themselves unable to meet their payments, made proposals to that company which were rejected, and that these farmers are now negotiating with the Bolivian government with a view to purchasing land in Bolivia, and intend, or are even now making preparations, to move out as a colony of settlers to that country. If the government has heard of this, I would like to know if any action has been taken; whether the Canadian Pacific Railway have been approached on the matter; and whether there is any hope of holding these, farmers in Canada.


William Lyon Mackenzie King: So far as I am aware, no representations have been made to the government in this matter. I will draw the attention of the Minister of the Interior (Mr. Stewart, Argenteuil) to my hon. friend's remarks.
QUESTIONS AND ANSWERS-INQUIRY On the Orders of the Day:


Mr. JAMES ARTHURS (Parry Sound):: On April 30 I drew attention to the fact that
[Mr, Speaker.!
a question of mine had been answered by a reference to another question on the same subject, and that a further reply was promised. The answer would be a very short one, and I see no reason for delay. There was also another question standing in my name affecting more particularly the Minister of Militia, respecting rifle sights. The answer would be very short, and I see no reason for delay in this case also.


William Lyon Mackenzie King: The minister (Mr. Macdonald, Pictou) is reviewing the cadets on Parliament Hill at the moment. As soon as he comes in I will draw his attention to my hon. friend's remarks.



THE READING ROOM

[Stage Direction]
On the Orders of the Day:
Mr. J. J. HUGHES (King's, P.E.I.):: Mr. Speaker, I wish to draw your attention to a practice that is being followed by some members of sending to the Reading Room and getting newspaper files sent to their private rooms. They keep them there for a considerable time, a day or more, and then return them either of their own accord or when they are sent for, considerably mutilated and torn. If it is the privilege of members to keep these papers in their private rooms, the privilege is being abused, and I think it would be well to provide a remedy.


Hewitt Bostock: The words of the hon.
member will surely serve as a notice to the delinquents.



WAYS AND MEANS


[Stage Direction]
The House in committee of Ways and Means, Mr Gordon in the chair.
2. Resolved. That' it is expedient to amend the Customs Tariff, 1907, by adding at the end of section five thereof as enacted by chapter forty-two of the statutes of 1923 the following proviso:
Provided that in computing the ad valorem rate of duty on tea purchased in bond in the United Kingdomt the value for duty shall not include the amount of the customs duty payable on tea for consumption in the United Kingdom.
The CHAIRMAN:: This clause was alio wet to stand by consent.


Sir HENRY DRAYTON:: I think the Minister of Customs (Mr. Bureau) was under a misapprehension as to the situation. I am inclined to think that the Acting Minister of Finance (Mr. Robb) is correct when he says this removes the only existing disability. Under those circumstances I do not press my amendment.


[Stage Direction]
Resolution agreed to.

Ways and Means-Customs Tariff
Customs tariff-12a. Sausage skins or casings, cleaned: British preferential tariff, free; Intermediate tariff,
15 per cent; General tariff, 174 per cent.
Henry Lumley Drayton: Before we go into that. My hon. friend (Mr. Robb) was to cheek a list which was submitted, and as to which he could not speak with definiteness.


George Newcombe Gordon: What list?


Henry Lumley Drayton: A list of articles which enter into the manufacture of different articles in this section which we struck out.
I may say that the only sections that were struck out in committee, so far as I know, and I was here all the time, were the first three. The general resolution was not put.


Mr. ROBB:: That is my understanding.


Henry Lumley Drayton: My hon. friend was to check the list. I have been handed this list which I suppose is the correct one.
I do not wTant to delay my hon. friend by going over it all. Perhaps the committee would allow me to put it on Hansard.


James Alexander Robb: No. The situation yesterday, as I recall it, was that my hon. friend submitted a list of articles which he claimed entered into the production-


Henry Lumley Drayton: I asked if it did;
I said I did not know.


James Alexander Robb: -of these materials. I was aware of this list before, I knew it had been freely circulated, an intimation was made in the public press, that the tariff concessions affected all these items. I am sure my hon. friend will not expect me to explain in detail the extent to which these different items do enter into the production of these articles affected by the tariff. What I did was to supply my hon. friend with a comparison of the rates of duty-the old rates of duty under the general tariff and the new rates-and the percentage of these that will go into the items affected by the tariff. I make no commitments, but I say if my hon. friend will refer to the bottom of the memorandum I have given him he will find a reservation there, that articles for resale, in condition as imported would be subject to the usual rates applicable to such articles, and are not admissible under tariff item 445a.


Henry Lumley Drayton: Certainly.


James Alexander Robb: That means that when the manufacturer goes to the customs claiming admission for these he must establish to the satisfaction of the officers that the articles will enter into the cost of production.


Henry Lumley Drayton: I did not expect my hon. friend to be able to give us the percentages that he referred to.


James Alexander Robb: Oh no.


Henry Lumley Drayton: That would mean
a great deal of study and a good deal of delay. But I want to find out if these are articles that enter into the manufacture, that is what I was trying to find out; and I supposed my hon. friend's list would show that these articles do enter into the manufacture of these goods. That is all.


James Alexander Robb: I will admit at once that looking over the list casually I should say a good many of the articles enter into the manufacture but to what extent or percentage I would not undertake to say. It might be that a very trifling part of these items would enter into the construction of an implement, or product, affected by the reductions in the tariff.


Henry Lumley Drayton: I am not asking for percentages, and I do not want to delay my hon. friend. I just want to know whether these articles enter into the manufacture and to what extent they are used. My hon. friend has prepared a list here himself which reads:
The following articles when imported by manufacturers of goods enumerated in tariff items 445, 440, 446b, 447b, 448 and 591 for use only in the manufacture of such goods enumerated in said items are rated as below.
Then we have the list. I suppose this list prepared by my hon. friend is correct.


James Alexander Robb: It is correct.


Henry Lumley Drayton: Then, instead of asking my hon. friend to read his list, in order to facilitate the work of the committee I am quite content it should be handed to Hansard.


James Alexander Robb: Let me clear this up with my hon. friend now. I want to be perfectly frank with him. This was checked out from a list that circulated freely in the public press and was supplied, I understand, by the Manufacturers' Association. It is the Manufacturers' Association that make the statement that these different items are affected by the reduction in the tariff, I am not prepared to guarantee that all that is put out there is correct. I would say in a general way that many of these items do go into the manufacture of such articles as are affected by the tariff, but I would not certify that they all go in.


Mr. FORKE:: I notice "Goggles" here.
If goggles go in, paint might as well go too.
246S	COMMONS
Ways and Means-Customs Tariff


James Alexander Robb: Goggles are not affected by
the rate, there is no change in that respect.


Henry Lumley Drayton: My hon. friend says he does not know that all these articles of necessity go into the manufacture, he does not want to certify as to that. I want to be absolutely fair to him. His impression is that they probably all do; is that right?


James Alexander Robb: I would not say all, no. I
would say many of them do.


Henry Lumley Drayton: Then, is there one article on that list, which list has been in the hands of his experts for weeks, that my hon. friend says ought not to be there?


James Alexander Robb: Can my hon. friend tell me
this:	Will he say that brooms play any part
in the construction of agricultural implements?


Sir HENRY DRAA  TON@: If my hon. friend says they do not that is all I want to get.	*


James Alexander Robb: I say they do not.


Henry Lumley Drayton: Very well, what else besides brooms? Surely my hon. friend takes his budget proposals a little more seriously than to laugh. We are dealing with tariff items and we want to know what items are affected. I have given a list to my hon. friend for the purpose of being checked over to see whether it contains correctly the items affected. Now he tells me that in one case it is not correct-brooms. Very well, take that out; is there anything else that is not correct?


James Alexander Robb: I am not going to check the
list.


Henry Lumley Drayton: Well, I just
point out, Mr. Chairman, the way this House is legislating upon this question. The minister does not know what articles he is dealing vith, or what articles are affected by these changes.
file CHAIRMAN: (Mr. Marcil, Bonaven-;ure):	Shall the item carry?


Henry Lumley Drayton: What is the
minister going to do about my suggestion of putting the list on Hansard? It is his list.


James Alexander Robb: I have no objection to my
hon. friend putting the list on Hansard, with this reservation-that I do not admit they all go into the production.


Henry Lumley Drayton: There is apparently one thing we can agree on, that is that my hon. friend does not know what is affected.


James Alexander Robb: I would not admit that.


Mr. GUTHRIE:: Until this moment I have not had an opportunity of examining this list, but if I understand it aright it is a list prepared by somebody of articles which probably or possibly enter into the manufacture of agricultural implements and by reason thereof the present duties will be reduced. I notice on the list the old rate and the new rate of duty. In the riding which I have the honour to represent while we are not to a very large extent engaged in the manufacture of agricultural implements as such, there are a great many items on this list which are manufactured there. I take the first item, wagon springs. Apparently the old rate of duty is 17i per cent. The new rate according tc this list is 6 per cent. Will the minister tell me whether in the case of wagon springs- which are made largely in Guelph-the"reduction will be from 17J to 6 per cent?


James Alexander Robb: On springs going into a
vjagon-that is affected by this tariff, yes.


Hugh Guthrie: That is, a farm wagon,
The next item is coil springs, which are also made in my city, and which are used to some extent in various kinds of agricultural machinery. The present duty on coil springs is 30 per cent, which under the new arrangement will be reduced to 6 per cent. Do I understand that the duty on all coil springs that go into agricultural implements of any kind will now be reduced from 30 per cent to 6 per cent?


James Alexander Robb: If they go into the agricultural implement that is affected by this, yes. Let me point out to my hon. friend that the manufacturer of coil springs will also have some concessions by way of reduction of duty )n his raw material.


Hugh Guthrie: That is just what I
wanted to ask. If the manufacturer makes coil springs which ultimately go into agricultural implements, what provision is made for him; does he get his raw material in free?


James Alexander Robb: No. If it is established that
he is at a disadvantage, the government will try to put him in a reasonable position. Let me clear this up with my hon. friend at once. \V hen the tariff was first announced hon. gentlemen opposite, in the House and through their press, said that the agricultural implement industry of this country was ruined, that the government were practically putting it out of business. But shortly afterwards the manufacturers of agricultural implements issued a statement saying they were able to carry on, and it was established, I think, by a

Ways and Means-Customs Tariff
supporter of my hon. friend's, that these manufacturers were almost in as good a position as they were before; indeed there were some hon. gentlemen who reversed their position later on and declared the manufacturers of agricultural implements were even in a better position than they had been before; but statements were then made in this House and in the press that the steel industry was to be ruined by the action of the government. But the same newspapers which announced that our steel industries were closing down their furnaces because of the action of the government, printed in their financial pages announcements from the managers of these industries that they had orders enough to keep them going until September. No later than yesterday in the Montreal Star-and no one will contend that this paper is over zealous in supporting the government-in the financial column -not in the political column, be k noted-Mr. Hobson, who is a recognized leader in the steel industry of Canada, gave out a statement which I will read for the benefit of my hon. friend. This is the announcement :
Expects steel business to pick up a little.
Toronto May 22.-(Star Special).-
The rumour that Steel Company of Canada had decided to curtail operations was definitely denied this morning by President Robert Hobson, of that company, who, while he would not say that the outlook was particularly bright', was distinctly optimistic as to the immediate outlook, saying that operations were continuing at a fair rate, approximately 70 per cent capacity.
"The outlook is regarded with a little more confidence generally." said Mr. Hobson, who added that he could see indications that business might pick up a little rather than the reverse.
Mr. Hobson further stated that a second furnace would be blown in during the course of the next three or four weeks, and set at rest various rumours by explaining the reason for the temporary shutdown. The furnace, he said, had been put in in 1896 and its shell had been worn almost completely through. It had been closed to permit the construction of a new shell. This work was well under way and would be completed within the next three weeks and the blast put into operation again.
So I am inclined to take Mr. Hobson as an authority on the steel industry of Canada rather than my hon. friend opposite. This government has no intention of ruining any Canadian industries. We want and expect our industries, as a result of the budget, to do more business and employ more hands than ever before.	'


Hugh Guthrie: After his speech the minister perhaps will turn for a. moment to the question I asked him:	Will the manufacturers of wagon springs and of coil springs be entitled to get in their raw material under any better rate in future than they
have in the past? I understood my hon. friend to say that they would have some relief. I did not find it in his budget speech, nor do I find it in his schedules. I wish he would point out to me where it is.


James Alexander Robb: I say frankly to my hon. friend, realizing fully the responsibility of the statement, that if it can be established that industries manufacturing these different parts are adversely affected by the tariff to a degree that they require consideration, the government will be prepared to give them fair consideration.


Hugh Guthrie: Does the minister make that statement under authority? He cannot alter the tariff, as he knows, after parliament has prorogued. Does he propose bringing in some legislation this session empowering him to make these changes? Or under what authority does he intend to act?


James Alexander Robb: My hon. friends will have to accept my statement, as I hope the manufacturers will.


Hugh Guthrie: Is there any foundation for the statement?


James Alexander Robb: There is sincerity in it.


Hugh Guthrie: That may be the pious wish of the minister himself. If he brings in legislation giving him the power, that would be foundation enough. He knows that once the tariff act is passed, it is final until the House meets again. Will there be any chance, say next autumn or next winter before the House meets, of the manufacturers of steel wagon springs and of coil springs obtaining relief in respect of their raw materials where their springs go into faftn *wagons and agricultural implements? The minister said they might rest assured that they would be taken care of, or words to that effect. I wish he would give me some assurance on which they can do business.
Mr. FORIvE: Is the item fuel oil correct? It is put at lOOi per cent.


James Alexander Robb: It is a typewriting error; it should be one-half cent.


Hugh Guthrie: I take another item in which my constituency is particularly interested-pipe.	This list simply has the
item "pipe". As the minister knows, perhaps, there is a large industry in Guelph making iron pipe. Pipe is now marked on this list 30 per cent, and the proposed reduction will put it down to 6 per cent. Do I understand
2470	COMMONS
Ways and Means-Customs Tariff
from the minister that the tariff reductions showD on this list are correct, and that pipe will be reduced from 30 to 6 per cent?


James Alexander Robb: If it goes into the manufacture of an article that only bears 6 per cent duty.


Hugh Guthrie: Is the same thing correct in regard to belt pulleys? They are made in the city of Guelph too. The reduction in this case is from 271 to 6 per cent. Does the minister contemplate, in regard to the pipe industry or the manufacture of belt pulleys, that any advantage will be given to these manufacturers to compensate them for the reduction which they must now face where their goods enter into the manufacture of agricultural implements? Can the minister give me any assurance? I want it for the purpose of passing it on to the manufacturers of whom I speak. If he can, it will be gratefully received in the city of Guelph where these things are made.


James Alexander Robb: Careful consideration will have to be given as to what percentage of the output of an industry is affected by the tariff changes. If an industry is enjoying twenty, twenty-five or thirty per cent protection on ninety per cent of its products and the other ten per cent is affected by these changes, 1 am not so sure that it would be possible to make out a case. But we will look into the matter very carefully.


Mr. CALDWELL:: Have only two of these lists been prepared? What is the idea of supplying two members of the House with a list which the rest of the House does not have if we are expected to consider these it^ms with any intelligence?


The CHAIRMAN (Mr. Marcil, Bonaven-ture):: We are at item No. 12A, "sausage
skins or casings, cleaned," and all this discussion does not refer to this item at all.


James Alexander Robb: I provided those lists as a
matter of courtesy to the hon. member who was leading the opposition this afternoon and the hon. member who was leading the Progressives. I do not place so much importance upon the list as my hon. friends seem to do, as it was a list that was issued and widely circulated by the Manufacturers' Association, in an attempt to convince the people that we were ruining the country. May I point this out again?-that as regards many of these items, the great percentage of production of an industry is affected very slightly. I should like to appeal to the judgment of my hon. friend (Mr. Caldwell), who knows something 
about farming, or potato growing anyway, if I cannot appeal to the genial member for West York (Sir Henry Drayton); will he tell me to what extent disinfectants will enter into the manufacture of agricultural implements? -to what extent will tungsten lamps enter into the manufacture of agricultural implements?-to what extent will electrical equipment enter into their manufacture? There are three items that just come to my attention. It is sufficient, I think, to mention those items to show, to say the least, that this list is considerably padded.


Thomas Wakem Caldwell: I almost thought for
the moment that we were considering the items on thig list. If that is not what we are considering as items under the tariff, possibly k is not very relevant, and therefore my objection has been removed. So far as I can gather from this list, it is about on a par with the claim made by the manufacturers as regards the whole tariff. Much of the literature circulated by them is an attempt to becloud the issue entirely.


Henry Lumley Drayton: The reason why this list is here is because, instead of wasting the time of the committee in an endeavour to get information from the minister when he did not have it, I handed in a list and he said that he would check it. If you will look at Hansard at page 2422, the minister says:
I will be quite content to take the list and have the customs authorities who are to administer the act, look carefully into it and check it over.
I then said:
I will put it on Hansard, and then the minister can have it cheeked. My instructions are that these are only some of the things.
What I wanted to get at was the truth, that is all. The minister was to have the list checked and was to let us know the result. I do not know what position he wants to take to-day, whether he is going to say that what he said before is not to be acted upon; but I can assure him that he will not make much progress taking that stand.


James Alexander Robb: I can see now that when
my hon. friend spoke of "checking," he had one thing in mind and I had another. I understood him to mean that we would check the difference in the duty if these items went into the manufacture of agricultural implements.


Henry Lumley Drayton: No.


James Alexander Robb: I say frankly to my hon.
friend that at this stage of the legislation I would not undertake to find out what goods

Ways and Means-Customs Tariff
enter into the manufacture of articles affected by this legislation; but that will be carefully checked, and a manufacturer will have to establish to the satisfaction of the Department of Customs and Excise that an item goes in to the manufacture of agricultural implements before he will have consideration for rebates.


Henry Lumley Drayton: My hon. friend
is entirely at another point and there was no room for any misunderstanding. If my hon. friend will look at page 2421 of Hansard, when I W3s picking out some of these items and asking whether my hon. friend knew whether they were affected or not, my hon. friend admitted that some of them were. My hon. friend said:
We will admit they are going in as farm machinery.
That is, these items that I was referring to.
I said:
I do not want to be unfair to my hon. friend. If he does not know, it is unfair for me to go on establishing facts, because he may be stating something which is not correct. I only want the truth, and I want to know what we are legislating about.
There was no question of tariff at all. It was a question of the items, whether an article was or was not affected. I continued:
I suggest to my hon. friend that he should bring down a list of all the articles entering into the manufacture of articles which will be covered by these reductions. He will have it right then.
We had some more discussion and I handed that list to my hon. friend to be checked. I cannot understand why there is any room for a difference of opinion as to what Hansard said.


James Alexander Robb: I do not dispute what Hansard says, but I had in mind that the request was to check the rate of duty. Had I thought that my hon. friend wanted me to send out to the different manufacturers and inquire from them to what extent these various items would enter into their industry, I would have at once made it clear to him that I did not propose to do that. I do not propose to do it now.


Henry Lumley Drayton: My hon. friend
would be quite right if he says: "To what extent?" I did not ask that. I asked only if these items entered into manufacture of farm machinery. The situation resolved itself into this, that the government have brought in these resolutions without knowing what articles they are affecting, and although it is now six weeks since the budget proposals were brought down, the government even today do not know what they are doing and will not take the trouble to find out.


Robert Forke: It would be an utter impossibility for the government at this time to bring down every article that will enter into the manufacture of all kinds of implements.
I think the hon. member who is leading the opposition is asking an impossibility. I may be wrong, but I do not see how this is possible.


Henry Lumley Drayton: Yes, the hon.
member is quite wrong. It is an easy matter.


Robert Forke: I am much obliged to the
hon. member for the kindly advice he always hands out to me when I am on my feet, but I have an opinion of my own, anyway.


Hugh Guthrie: The list has only come
to my attention to-day. It is very interesting to me and it will be very interesting to the riding which I have the honour to represent.


James Alexander Robb: My hon. friend says that this list has only come to his attention to-day. He told us a moment ago that he represents a constituency that is interested largely in the manufacture- of these products that enter into the manufacure of farm machinery. How does he explain that he has heard of this list only to-day? Are his constituents not interested in it?


Hugh Guthrie: I did not see this list
until five minutes ago when I noticed it o* the desk of my hon. friend (Sir Henry Drayton) who is sitting next to me. I represent a constituency which is taking a very deep interest in this matter, and, I have received many communications from my constituents. On looking over the list I find that among the articles enumerated in it that are manufactured in Guelph and are manufactured for the purpose of going ultimately into the manufacture of agricultural machinery and ;he like, are the following:
New Rate Old Rate
Ball bearings (made	Per cent in 2 factories). 10 	
12*	Per cent 6 6Malleable castings..	
27*	6Grey iron castings item in Guelph)..	(another large 	
27*	6
30	6
30	6
30	6Pjpp	
30	6Pulleys, belt	
27*	6Springs, wagon.. ..	Springs, coil	
30	6
Spring keys			 30	6
There may be other items of which I am not aware, but those I have enumerated are all made in Guelph. Hon. gentlemen to my left have been applauding continuously
Ways and Means-Customs Tariff

throughout the reading of these items, and I wish that the applause could be recorded in Hansard. I want it to be noted that each of the reductions which I have indicated has been heartily applauded by the Progressive group, at least a dozen of whom have been clapping their hands and pounding their desks.


Some hon. MEMBERS:: Hear, hear.


Hugh Guthrie: 
James Alexander Robb: Let me at once direct the
attention of my hon. friend to item 1027, which we shall reach once we get this one out of the way. Item 1027 reads:	'
Materials, when used by manufacturers of malleable iron castings or steel shafting for use exclusively in the manufacture of such articles for use in the manufacture of goods enumerated in tariff items 445, 446, 446b. 447b. 448 and 591.
In that case there is an 80 per cent rebate on the duty.


Hugh Guthrie: Why not all the duty?


James Alexander Robb: Because they have 6 per cent protection for the difference.


Mr. WHITE:: Does that 80 per cent apply to the duty on fuel as well?


James Alexander Robb: No; we have not considered fuel in that connection.


Mr. EVANS:: To what extent is the article mentioned in item 12a imported?


James Alexander Robb: We have not reached that item yet. I will give the information when we come to it.


James Joseph Hughes: The hon. member for
South Wellington (Mr. Guthrie) makes a distinctly sectional plea; he speaks for the people of Guelph, whom he particularly represents. Well, I want to say a word or two for the people I represent. My hon. friend says that the people he represents will be injured if any of the privileges they have hitherto enjoyed under a protective tariff or under a high tariff are taken away. I claim, Sir, that the people I represent have been injured for many years by the tariff and will still be injured by the proposed tariff, but the injury will be less. They have to go out in the open world and find a market wherever they can for the goods they produce, and they have been obliged by the tariff to take the money they get for their goods, go to Ontario and Quebec and purchase the things they need at prices which are enhanced by the tariff. It is the most inequitable legislation that could be put on the statute books. The people I
represent cannot under any possible conditions receive benefit from any tariff or any protective tariff that can be introduced. My hon. friend says that the people of Guelph particularly are receiving advantage from the customs tariff that has been in operation. The hon. member for St. Lawrence-St. George (Mr. Marler) makes the same claim, as do the hon. member for North Waterloo (Mr. Euler), the hon. member for Brantford (Mr. Raymond), and several others. Taking these statements at their face value, I submit that if the people living in the neighbourhood of those cities are benefited by the customs duties, in the name of fair play they should pay for those advantages. Let them provide this payment in any way they wish-by bounties; that would be a simple way of doing it.


Thomas Wakem Caldwell: A benevolent way.


James Joseph Hughes: A fair way. I would have no objection to that, but I protest as strongly as I can against the people I represent being compelled to pay for the advantages that the people living in Guelph and in the neighbourhood of Guelph enjoy. It cannot be called a "national" policy. I want to bring that view to the attention of my hon. friend, who, I believe, is a fair man and wants to be an honest and a just man. I ask him to consider the people I represent as well as those he represents, and to give us all fair play.


Thomas Wakem Caldwell: Make an average.


James Joseph Hughes: Yes, make an average.


Mr. EULER:: What do you mean by an
average?


James Joseph Hughes: I mean we should have
an average of justice in this country.


William Daum Euler: An average of justice,-that is a new one.


Thomas Wakem Caldwell: It is certainly new in
this country.


James Joseph Hughes: An average of fair play.


William Daum Euler: We ought to have fair play, not an average of fair play. Fair play is a definite thing. The term "average fair play" is absurd.


James Joseph Hughes: The position taken by the hon. member for North Waterloo in regard to the protective tariff is unjust as well as absurd.


William Daum Euler: I suppose it is "average
injustice," is it?
2474	COMMONS
Ways and Means-Customs Tariff


James Joseph Hughes: My hon. friend can speak
in this committee whenever he wishes. I am making a statement now, and I am sure that I make it to men who recognize justice and fair play. I think, too, that I have some backing in what I say.


Hugh Guthrie: In regard to the item to
which the minister called my attention- 1027, materials when used by manufacturers of malleable iron castings-do those materials include fuel coal or steam coal?


James Alexander Robb: No.


Henry Lumley Drayton: The minister
does not know whether these new tariff changes may become necessary or whether he is going to make exemptions or modifications under section 286 of the Customs Act, but if he is not going to do it that way, how is he going to do it?


James Alexander Robb: It can be done under section
286 of the Customs Act if it is found necessary.


Henry Lumley Drayton: So the present idea is that any injustices that develop, and which the minister would not be guilty of if he knew what he was doing, are to be cured under section 286 of the Customs Act. What are the principles under which the government will act in correcting those injustices? Take for example the case he himself gives, where there is but a small percentage used of a firm's output affected by these tariff reductions. What percentage, in my hon. friend's view, would have to be shown before the government would interfere and aid? In the case of the small percentage he mentioned he seemed to think that nothing ought to be done. Just where would he consider action necessary under section 286?


James Alexander Robb: That is a very fair question. My hon. friend has had some experience: He travelled, I think, from Halifax to Vancouver taking evidence as to revision of the tariff. I am not sure that he ever went much further than that, but he had the evidence and he probably has very definite ideas as to what should be done. Generally speaking, I think the question of where tariff protection should be afforded should be very carefully gone into. I. think the Prime Minister (Mr. Mackenzie King) made it clear in his speech on the budget that the government proposed to go very carefully into the conditions throughout Canada during the year. One item that might be very carefully looked into, for instance, in industries enjoying tariff protection would be the 
amount of watered stock they had. I think the people of Canada have a right to know whether these industries are paying dividends on watered stock or not. There are many other considerations affecting industries that my hon. friend knows must be taken into account.
I do not like to delay the passing of my own resolutions, nor to prolong this debate, which in the House continued from the 10th of April up to the 15th of May, but I would like again to remind my hon. friends opposite that they have not kept one principle steadily in view in the consideration of these tariff changes. I repeat again that in the early period we were said to be destroying the agricultural implement industry in this country; then we were destroying the steel industry. I do not admit that all the newspapers opposed to this government have a right to speak for the official opposition but there is one man who has a right to speak for the official opposition in this House, and that is the deskmate of my hon. friend from West York, and I have no doubt that his leader consults with my hon. friend before making any declaration on behalf of the party. Now let us take the evidence of the right hon. gentleman who leads the opposition (Mr. Meighen) as to the effects of the tariff reductions proposed by this government on the whole trade of Canada. I think the general trade of Canada last year was about two billion dollars, perhaps one half of which was produced in this country. What did the leader of the opposition say with respect to the effect of these proposed tariff reductions? Turning to the party at his left he asked: What are you getting out of this tariff after all; what are you getting out of these reductions? I will give his exact words:
I venture to say that not $300,000 in its entirety will be taken off farm implements. Add to that if you like the home consumption, if you still stick to it that your theory is right, and you have something like $700,000.
Now, is a reduction of $700,000 going to ruin all the vast industries of this country?


Henry Lumley Drayton: Mr. Chairman. I must apologize for not putting my question in such a way that my hon. friend could understand it. I never asked him anything in connection with which he has made a speech. He has not answered my question. After saying that it was a fair question, he proceeded to forget all about it. Well, let us forget what has happened in the meantime; it has nothing whatever to do with the question. I again ask my hon. friend,

Ways and Means-Customs Tariff
what percentage of the output of companies affected under the provisions which render free, or more free, the raw materials of agricultural implements must be affected before he will undertake to consider their case under section 286 of the Customs Act?


James Alexander Robb: I will frankly say to my hon. friend that I have not yet reached a conclusion upon that. In considering to what extent they are affected, one must take into account the amount of real capital invested in the business, how much watered stock they have, and other conditions affecting the industry.


Henry Lumley Drayton: Of course, it
goes without saying that no tariff ought at any time to be so fixed as to protect fictitious values; there is no question about that, and nothing is gained by constantly repeating it. The real thing I would like my hon. friend to think about is something that, so far, I have not seen much evidence of his having thought about; it is not any question of capital; it is not any question of stock; it is merely a question of labour and keeping men in employment, that is all. That is the only thing he has really a right to be interested in. These other things are merely incidental to the main question. Surely my hon. friend has some idea as to what deprivation he is going to see business suffer in terms of men before he will interfere under section 286 of the act. It is really an extraordinary situation, Mr. Chairman, when we have the admission from the government, in the first instance that they do not know the list of activities that will be affected; in the second instance that, not knowing, they are nevertheless going to make sure these industries will not be hurt; and in the third instance that they have not the slightest idea of what principle they will proceed upon or when they will proceed to give assistance under section 286 of the Customs Act. Suppose my hon. friend forgets speeches and platitudes for a moment; let him consider this matter from the point of view of the number of Canadians working in any given activity, and tell us, if he has gone far enough into the matter to be able to tell us what percentage of Canadians have to be driven out of work in connection with these industries before he will extend a helping hand.


James Alexander Robb: I will ask my hon. friend a
question. Does he think it would be good business to give a protection of thirty per cent to an industry employing ten men, where they could keep the products of their industry up so high as to prevent fifty other men working in other industries?


Henry Lumley Drayton: Certainly not.
The large question has to be looked into.


James Alexander Robb: You have given my answer.
It is a large question.


Henry Lumley Drayton: The whole
general question has to be looked into; but the time to look into it is before you act, so that you will know where you are going, instead of writing out a blank cheque, as apparently is written out in this case. I do not want to delay the committee. Apparently we cannot get any information from the government in connection with these many industries that are affected. I hold in my hand a list which I got from the minister, a result of what was said in Hansard on May 22, at page 2421 and 2422. The list is headed:
The following articles when imported by manufacturers of goods enumerated in Tariff items 44-5, 446, 446b, 447, 448 and 591 _ for use only in the manufacture of such goods enumerated in said items, are rated as below:
Now I propose to read the list or to hand it to Hansard, whichever the Chairman and the committee prefer. I have suggested several times that it be handed in to Hansard.


James Alexander Robb: I have no objection to its
being handed in, if the Chair is willing, and if it is understood that it includes the paragraph on the bottom of page 6, reading: "Articles for resale in condition as imported would be subject to the usual rates applicable to such articles and are not admissible under tariff item 445a."


Henry Lumley Drayton: Perhaps the
minister would hand in his copy to Hansard.


James Alexander Robb: 
Thomas Wakem Caldwell: Is that another list?
I find the list I was complaining of was in Hansard yesterday.


James Alexander Robb: This is another list.


Thomas Wakem Caldwell: I find this list was
handed in by the hon. member for West York (Sir Henry Drayton). We have been considering the items in this list, instead of the items in the budget, and I think it is a mistake to have allowed it to appear in Hansard.
I think we should go on now and consider the items in the budget.


James Alexander Robb: We will.


Thomas Wakem Caldwell: I do not think these
things I have objected to should be inserted in the record of the House, if I may be allowed to express an opinion.


James Alexander Robb: I do not object at all but I
again make the statement that in my judgment it is not a complete list, that the articles are not all affected as indicated there. But if the articles do go in to any considerable extent the rate of duty mentioned there is the rate that will be paid.


Charles Marcil: Now we shall go on with the consideration of item 12a.


James Alexander Robb: 
REVISED
[Stage Direction]
under the general tariff from Australia $11,143; under the general tariff from the United States $275,540; and under the general tariff from other countries $14,856; a total importation of $413,010. Hon. gentlemen will notice that the change is largely in the British preference. We are adopting this policy to divert this business if we can to New Zealand, and if Australia comes in that country will also have the benefit of the new tariff.
Item agreed to.
Customs tariff-68a. Peanut shells or peanut hull meal for use in the manufacture of explosives: British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: This is a very small item.
We are making it free in the case of all the tariffs. This material is used for the same purpose as Cassava flour. The present rates are: 15 per cent, 17i per cent and 174 Per cent.


Henry Lumley Drayton: How much business is involved in the year?


James Alexander Robb: As I said a moment ago this
material is used for the same purpose as Cassava flour and glycerine. We cannot tell how much business will be brought in. I suppose the manufacturers of explosives will use whichever is the cheapest; they are all imported.


[Stage Direction]
Item agreed to.
Customs tariff-157b. Rum, When imported by the Department of Customs and Excise or by a person licensed by the Minister of Customs and Excise, to be denatured for use in the arts and industries, to be entered at ports prescribed by regulation of the Minister of Customs and Excise, subject to the Inland Revenue Act and to the regulations of the Department of Customs arid Excise per proof gallon, British preferential tariff, free; Intermediate tariff, 60 cents. General tariff, 60 cents.
James Alexander Robb: This places rum on the same basis as alcohol to be denatured for use in the arts and industries.


Henry Lumley Drayton: What are the
present rates?


James Alexander Robb: The rates are $8, $10 and
$10. The West Indian agreement provides for 60 cents a gallon preference, and the changes we are making are to conform with that agreement.


Henry Lumley Drayton: Is there any
loss of revenue?


James Alexander Robb: I would not think so.


[Stage Direction]
Item agreed to.
Customs tariff-180b. Artists' proof etchings unbound, such as are printed by hand from plates or blocks etched or engraved with hand tools and not such as

[Stage Direction]
2478	COMMONS
Ways and Means-Customs Tariff
are printed from plates or blocks etched or engraved by photo-chemical or other mechanical processes, British preferential tariff, free; intermediate tariff, free; general tariff, free.
James Alexander Robb: We have no information upon this because there was no separate classification of imports. There will be a very small reduction in revenue. The present rates are 15 per cent, 22i per cent and 22i per cent.


[Stage Direction]
Item agreed to.
Customs tariff-275. Oil when imported by miners or mining companies or concerns, to be used in the concentration of ores of metal in their own concentrating establishments, under regulations prescribed by the Minister of Customs and Excise, British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: The word "petroleum" was
struck out of the item. As I intimated yesterday that admits Scotch blast furnace oil. That is the only change.


Henry Lumley Drayton: What are the
existing tariff rates?


James Alexander Robb: The existing tariff rates are 15, 17i and 174 but it is free for the others. Now, Scotch blast furnace oil comes in under the same classification; it is free.


Henry Lumley Drayton: I suppose there will be no loss of revenue?


James Alexander Robb: The reduction of revenue will be very small.


[Stage Direction]
Item agreed to.
Customs tariff-348e. Brass or copper tubing, not more than one-half of an inch in diameter, in lengths not less than six feet, coated with metal, and not polished, bent, or otherwise manufactured: British preferential tariff, 5 per cent; Intermediate tariff, 10 per cent; General tariff, 10 per cent.
James Alexander Robb: The present rate is 20, 27i and 30. We propose to make the rates 5, 10 and 10.


Henry Lumley Drayton: What is imported under the preferential tariff now?


James Alexander Robb: Under the proposed rate or the old rate?


Henry Lumley Drayton: Under the old rate.


James Alexander Robb: The old rate was 20 per cent.


Henry Lumley Drayton: What came in?


James Alexander Robb: There was no separate classification for this. This is a very small item.


[Stage Direction]
Item agreed to.

Customs tariff-445. Mowing machines, harvesters, self-binding or without binders, binding attachments, reapers and complete parts thereof: British preferential tariff, free; Intermediate tariff, 6 per cent; General tariff, 6 per cent'.
Henry Lumley Drayton: I think the old rates there were 7i, 10 and 10.


James Alexander Robb: That is right.


Henry Lumley Drayton: My hon. friend
mentioned yesterday $21,863 as the reduction in revenue on this item.


James Alexander Robb: That is what I had in my notes, but I notice it had been corrected in red ink to $21,993.


Henry Lumley Drayton: That is pretty
near.


[Stage Direction]
Item agreed to.
Customs tariff-445a. Articles w'hich enter into the cost of the manufacture of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591, when imported by manufacturers of such goods for use in the manufacture of goods enumerated in tariff items 445. 446, 446b, 447b, 448 and 591, provided that goods which are entitled to free entry or a lower rate of duty than is mentioned in this item shall not' be entered at the rate specified in this item: British preferential tariff, 7| per cent; Intermediate tariff, 7£ per cent; General tariff, 7£ per cent.
James Alexander Robb: I beg to move that the
following be substituted for tariff item 445a:
445a. Articles which enter into the cost of the manufacture of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591, when imported by manufacturers of such goods for use only in the manufacture of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591. Provided that goods which are entitled to free entry or a lower rate of duty than is mentioned in this item shall not be entered at the rate specified in this item: British preferential tariff, 5 pe cent; Intermediate tariff, 6 per cent; General tariff 6 per cent.


Henry Lumley Drayton: We have had a discussion already on this item with reference to the list put in. The hon. member for Carleton (Mr. Caldwell) thought that discussion should not have taken place yesterday, and if the hon. member wishes to renew the discussion again to-day I am quite content. However, we did discuss the item properly on the general question and I do not think it necessary to go on with it again, except perhaps to give the minister an opportunity of saying something really definite as to what is intended to be done to these manufacturers. I want to see if he cannot add something to what he has already said.


James Alexander Robb: I cannot add anything more
to what I have already said-that they will be given fair consideration. I assure my hon. friend and hon. members that the government is absolutely sincere in its intention to dp-'

Ways and Means-Customs Tariff
fairly with all manufacturers. As my hon. friend knows, this is not a new principle we are introducing here; it has been in the tariff since 1907. It has applied to binder twine. We propose to deal fairly with all manufacturers.


Henry Lumley Drayton: I think my hon. friend will agree with me that it is an entirely new departure to write under the Customs Act a whole series of items. The idea of the act was to look after emergencies which from time to time arise in the business world. It never was intended for the purpose of enabling a Finance Minister to implement what he ought to have done in his budget. I do not think it has been before applied for that purpose or generally in any way. The number of changes going back for a long period of years would not equal this list or anything like it. I think we could go back to confederation and find less action than this list would call for if it is correct. But my hon. friend does not yet tell us on what basis a case is to be made out by those affected. How much employment is to be lost? I prefer to deal with it just simply upon that basis-the daily wage basis, the wages of Canadian workers. The minister will give us no information as to what he, the judge, who is reserving to himself the full function of this House in connection with all these items, thinks will be necessary before a case is made out.


James Alexander Robb: I give my friend this assurance, that we will try to deal sincerely and fairly with all industries, and we will not abuse the rights that are given us under the Customs Act.


Henry Lumley Drayton: What does my
hon. friend think an abuse would be.


James Alexander Robb: There are abuses of many
kinds.


Henry Lumley Drayton: Let us have one kind. What does he mean when he says he will not abuse the rights given him. What is that abuse which he is not going to practise?


James Alexander Robb: I will give my hon. friend an instance in connection with an item in the tariff to which I will direct his attention. In the early days when I became Acting Minister there camped on the doorsteps of the Finance department week after week and day after day, until finally I would not see them any more, people who wanted me to make changes by orders in council-changes which I am going to ask parliament to make. That is what I mean. We will not be hasty in making changes by order in council; rather
157i
we will wait for parliament, unless there is such an absolute necessity that we realize that it will be in the general interest of Canada to make changes. Is not that a fair basis to start on?


Henry Lumley Drayton: I would not
think so in this instance, because my hon. friend is advising the House that in the interests of commerce he is going to exercise the powers given to the government under section 286. For what purpose? For the purpose of keeping these other industries going. If it is necessary to do this, I should think the abuse would be if he did not exercise the power. I admit that it is an improper way of carrying on business and that the tariff ought to be fixed by this House. But we cannot get any information; the minister does not know. What he should look upon as an abuse, as I see it, would be allowing these industries to go to the wall, thus causing further unemployment and promoting a still greater exodus.


James Alexander Robb: I will not allow any industry
to go to the wall.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-445b. Rolled iron or steel in bars, coils or rods and pig iron, when imported by manufacturers for use exclusively in their own factories in the manufacture of goods enumerated in tariff items 445 and 446:	British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: I beg to move that the following be substituted for tariff item 445b:
Rolled iron, rolled steel and pig iron, when imported for use exclusively by manufacturers ip their own factories for the manufacture of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591: British preferential tarif, free; Intermediate tariff, free; General tariff, free.
The change really means that rolled iron or steel in bars, coils or rods is changed to read, "Rolled iron and rolled steel."


Henry Lumley Drayton: There is also a further extension exempting a lot of other classes.	.


James Alexander Robb: Affecting some other classes of industry, yes.


Henry Lumley Drayton: Certainly. We will not debate that now. What is the British preference, intermediate, and general?


James Alexander Robb: It was by a drawback before; this is a new item.


Henry Lumley Drayton: Oh yes, the
British preferential tariff is now free. There used to be a tariff-what was it?
24S0	COMMONS
Ways and Means-Customs Tariff


James Alexander Robb: On pig iron a dollar and a half a ton, two dollars and a half in the general column.


Henry Lumley Drayton: Intermediate
the same?


James Alexander Robb: Yes.


Henry Lumley Drayton: So it reads:
SI.50, S2.50 and $2.50.


James Alexander Robb: On rolled iron and rolled steel it was $4.25, $6.00 and $7.00, or 5 per cent to 74 per cent, 124 and 124. On pig iron the rates are: British preferential, $1.50 per ton; intermediate, $2.50 per ton; general, S2.50 per ton.


Henry Lumley Drayton: What would be the estimated loss of revenue?


James Alexander Robb: The estimated reduction in revenue will be $170,000.
S:r HENRY DRAYTON: Where does the product come from?


James Alexander Robb: That would depend on the location of the industry using it; I imagine mostly from the United States.


Henry Lumley Drayton: Were there any importations under the British preferential tariff?


James Alexander Robb: It came in under the general tariff.


Henry Lumley Drayton: That would be the States then.


James Alexander Robb: Yes.


Richard Smeaton White: Mr. Chairman, I want to say at the outset of my remarks that this subject is not a theory for me, it affects the business in which I have been engaged for about 35 years, it affects my life's work, and anything I say will refer not only to the business in which I am particularly interested, but it will also be typical of other iron and steel manufacturing concerns. Of course, we have to bear in mind that the amount of damage done to any industry is in direct proportion to the amount of the output that will be affected by these tariff items. I have had no communication with other makers of this material, and know nothing about what they have in mind, and what I have to say will simply be based on what I know of the business myself. It has been suggested that these appeals have been sectional in their character, but my appeal will be applicable wherever the business of making agricultural implements is carried on and wherever the supplies of raw materials for those implements are made.

I should like to say a few words about the treatment of the iron and steel industry during the last few years. Iron and steel bars under the tariff of 1907 were subject to a tariff levy of $7 per ton in the genera! tariff, $6 per ton in the intermediate and $4.25 per ton in the British preferential. On account of the lowering of tariffs on agricultural implements, the duty on materials, particularly iron and steel, of which I am speaking now, used in their manufacture, has been gradually reduced, thus making the position of the industry gradually worse. In the 1907 tariff, item No. 1002 provides for a drawback of 99 per cent of the duty paid on iron and steel bars entering into the manufacture of binders and mowers. In 1919, another reduction was made in agricultural implement duties, and articles entering into the manufacture of cultivators, ploughs, engines, threshers, tractors, fruit-grading machines, hay loaders and wagons were all made subject to a 30 per cent drawback of duty. In 1922, by item No. 1026, a drawback was provided for of 40 per cent of the duty paid on materials entering into cultivators, ploughs, threshing machines, fruit and vegetable-grading machines, hay loaders, rollers and milking machines. In 1922, under item No. 1027, a drawback was provided for of 30 per cent of the duty on materials entering into the manufacture of portable engines, street and road rollers, and farm wagons. In the same year, item No. 1028 provided for a drawback of 99 per cent of the duty paid on materials entering into gas tractors not over $1,400 in value. In 1923, item No. 1.036 provided for a drawback of duty of 30 per cent on materials entering into the manufacture of stumping machines. Those are about all the reductions that have been made in the iron and steel duties until the present budget. A considerable quantity of fire brick is used in the manufacture of this material and this fire brick was free of duty until 1922. In that year fire brick was placed at 15 per cent duty, so that the industry not only lost the protective duty on the materials I have mentioned, but suffered the imposition of a 15 per cent duty on fire brick. The items now being considered obliterate the duties on rolled iron and steel entering into a long list of implements. There possibly may be some explanation as regards the different opinions that have been expressed as to the effect of this tariff. To begin with, this item included only two items in the tariff. Now, it includes six. In consideration of all those changes, the only allowance given is that proposed in another resolution which provided for again putting fire brick on the free list.

Ways and Means-Customs Tariff
That puts the Canadian rolling mill in the same position as it was two years ago and prior to that as regards fire brick. Therefore in regard to duty, that item will cost just the same as it did before.
The gradual reduction in duty and all these changes in the tariff have had an effect on the iron and steel industry. In the early history of the iron and steel industry-in 1883 -a bounty was provided for' under certain circumstances. Those bounties were continued in various ways until 1910, but in all those years the industry had been developing gradually, and notwithstanding the fact that the bounties were abolished in 1910, there seemed to be no particular halting in the industry; it seemed to be fairly well established on that basis. The protective tariff then was just about enough to keep the industry going.
I should like to give a few figures showing the development of the iron and steel industry in Canada. I have here Metal Market Statistics, published March 1, 1924, by the American Metal Market and Iron and Steel Report of New York city. This company issuing this publication is recognized as an authority on such matters. This is a compilation of statistics dealing with the production of iron, steel and other metals in the United States and Canada. The latest compilation is for the year 1922 and it goes back for many years. First I shall refer to pig iron. The production of pig iron in Canada in 1922 was lower than in any year since 1904. It was lower than the production in 1921 by 40 per cent. The steel production of Canada was the lowest in 1922 that it had been for seventeen years: in fact, we have to go back to 1905 to find a year in which the production was lower. The production in 1922 was 38 per cent lower than in 1921.


James Alexander Robb: Has my hon. friend the
figures for 1923 and 1924?


Richard Smeaton White: No; 1922 was the last year
for which I could secure the figures. This is evidently all that has been compiled, because this is of date March 1, 1924. As to the development of the same class of business in the United States, I have not the figures on pig iron, but I have the figures on rolled iron and steel. If we take the same seventeen years to which I referred in connection with the figures covering Canadian production, the 1922 production in the United States exceeded the production for twelve of those years, and in 1922 the increase was 56 per cent over the production of 1921, as compared with a falling off in Canadian production of 38 per cent.
The Iron Age, another authority in the United States, well recognised, states that in 1922, 760,000 tons of rolled iron and steel were exported into Canada from the United States. I have heard many members on both sides of this House grow eloquent about the duty which devolves upon us of developing our natural resources and the prospect of its accomplishment. The matter was referred to in the debate on the Speech from the Throne, by the hon. member for Nipissing (Mr. Lapierre) who seconded the Address, by the Minister of the Interior (Mr. Stewart) and by many members of the Progressive group. It seems to me that the iron and steel industry is not in a position to develop under present conditions. I want to quote a letter I received a few days ago from a friend in Cleveland, a Canadian who found it to his advantage some years ago to go to the United States. The letter is dated May 9, 1924, and reads:
The demand in Canada for certain products is much less than in the States, giving the American manufacturer the advantage of large production	
If Canada could only develop her natural resources to a greater extent they would become a serious competitor to the States. . . . My personal impressions based upon 20 years of business experience are that the country that is protected with high tariffs has a better opportunity to maintain prosperity than one such as Great Britain that is affected by foreign competition. . . . Canada lias tremendous natural resources and a great future. I think in the past the government has given preference to the agricultural interests instead of the manufacturers. More inducements should be given the manufacturers of Canada so that they can compete with those of other countries. We are now exporting large quantities of goods into Canada and taking money away that never returns.
Under this item, which provides for the free entry of iron and steel bars for certain purposes, there is no British preference available. Some may contend that it simply means that competition between the European, the American and the Canadian mills will be on an even basis, but I cannot subscribe to that opinion. The Canadian mills are faced with the same conditions, of depreciated currency and lower wages in Europe, as all other lines of industry in Canada at the present time. There is nothing that I know of which has been proposed by this government to remedy the situation, particularly in regard to the depreciated currency. As compared with the American industry, the Canadian manufacturer is at a disadvantage, inasmuch as the American pays no sales tax on anything. The American pays no duty on coal; he pays no duty on machinery or supplies. The Canadian mills are of course situated in various parts of the country and get their coal from various sources. The British Empire Steel Company has its own coal supply and, I believe, supplies to some extent the mills in
2482	COMMONS
Ways and Means-Customs Tariff
Montreal. I am told too that the Montreal mills use some Pittsburgh coal as well. There is a mill in Belleville which uses American coal entirely, and1 the Steel Company of Canada at Hamilton also uses American coal. The mill in London uses American coal, and the mill in Winnipeg, I am told, uses partly American and partly Canadian coal, the difference being possibly in favour of Canadian coal. Now, the American coal that is used here is subject to a duty of 14 cents per ton on slack and 53 cents per ton on lump. With the present price of slack ranging between $1.40 and $1.50, that specific duty of 14 cents works out at 10 per cent; and the price of lump being about $2.50, varying somewhat, the duty of 53 cents per ton is equivalent to 22 per cent. The Canadian mills are also called upon to pay a duty of 27J per cent on the rolls they use, which is a large item; as well as on machinery repair parts. They pay a sales tax on all the articles I have mentioned, in addition to all brass and iron castings, oils, grease, beltings, and the hundred and one other things which are essential to an industry of the kind.
The minister has assured us that he does not want to injure industry and is quite willing to take into consideration any claims that may be made by the representatives of any industry concerning the effect of the tariff changes. The implied intimation is, I suppose, that some changes may be made by order in council. But no such changes can be made until after the close of this session, and I am advised that the duty on coal cannot be effected by order in council in any case; it can be altered, I take it, only if the minister takes power to himself at this session to make any necessary changes by order in council. As the matter stands at the present time, under the Customs Act no order in council can be passed affecting the duty on coal. Considering the figures which I have quoted in regard to the duties paid by Canadians, and the fact that no such duties and no sales tax are levied on American mills, I cannot see how the minister can argue that the Canadian mills have been treated fairly. The Canadian mill is up against American competition right now; there is no doubt about that. I have a letter which I have received from a western Ontario manufacturer of agricultural implements and which I shall read to the committee. It is dated May 7.
We will shortly place our order for material for our threshers, and as the most of this is now admitted free, under the new tariff regulations, before placing any 
orders we would like to know if you are going to meet the new situation by quoting a price to compete with the American prices laid down here. We would like to keep all our business in Canada, if possible, but the new tariff regulations seem to be framed with the view of driving it' out of the country instead of holding it here.
I think the minister would be well advised to consider carefully the facts I have submitted *to the committee and at least to make some changes which w'ill permit these
5 p.m. businesses to continue and make an even break, if they cannot do more, on this portion of their activities. The average reduction of duty on implements is about 5 per cent, and that, I believe, from recent figures quoted, is more than taken care of in the reductions which have been conceded on the duties on raw materials. These figures were put on Hansard on May 21, by the hon. member for Vancouver Centre, and I need not repeat them. If this resolution passes it will have the effect of removing a very small protection from the Canadian mills and providing instead a protection or a premium, whatever you like to call it, on American goods. It strikes me that, if the sales tax had been removed on more articles, just as great a reduction in the cost of living might have been effected as by the changes which have been made in the tariff schedules now under consideration. I contend that the reduction in this item of iron and steel bars has been too drastic and that considerable damage will accrue to Canadian industry. Mr. Hobson has been quoted; he represents a very large corporation which produces steel and iron on a considerable scale. Their works are equipped with blast furnaces open hearth plants, blooming mills, and all the other appurtenances required to turn out a large quantity of material-including fish plates, tie plates, and *many other articles that are not affected by these resolutions. I do not know to what extent their output is affected, but the proportion cannot be very great: Hence his optimism so far as his business is concerned. I appeal to the sense of fairness of the minister to see that Canadian industries are treated fairly. I estimate it would take a tariff of probably 6 or 7 per cent to counterbalance the taxes and the duties to which the Canadian producer is subjected. The minister might very well consider whether some duty might not be left on this item so that the disability I have tried to explain will not exist to the detriment of the Canadian mills. Under the resolution as it stands, the Canadian mills, so far as this portion of their output is concerned, will be much worse off than if absolute free trade were in existence.

Ways and Means-Customs Tariff


James Alexander Robb: I have had the advantage
and the pleasure of several talks with the hon. member for London (Mr. White) with regard to these duties as they affect steel, and I am bound to say he appealed to me as a man who was exceedingly well posted on the steel business of Canada. As regards the industry with which he himself is associated and industries of a similar character throughout Canada I thought he made out a case for very careful consideration, and I say to him now that we will carefully look into the representations he has made to us. That does not mean, of course, that we are prepared to make any change in the resolution at this time. I hope my hon. friend will accept that statement in good faith and rely upon the government to do what is fair. My hon. friend quoted some statistics a moment ago from a publication in New York, which he said he regarded as a reliable publication, affecting the iron products of the world, I imagine.


Richard Smeaton White: The United States and
Canada.


James Alexander Robb: He quoted the production
for the years 1921 and 1922, and I am not sure whether in giving the statistics for Canada he was quoting the fiscal year or the calendar year.


Richard Smeaton White: That would be the calendar
year.


James Alexander Robb: He said that the production
in the years 1920, 1921 and 1922 were the lowest since 1905. What was the low year?


Richard Smeaton White: It was 1922.


James Alexander Robb: I would remind my hon.
friend that there was a change of government in the first part of 1922. I would like to put on Hansard certain statistics I have so that the Canadian public may compare them with those my hon. friend has just submitted.


Richard Smeaton White: The figures I quoted referred to ingots and castings.


James Alexander Robb: I hold in my hand an official publication of the Dominion Bureau of Statistics dated February 25, 1924, so that it is pretty nearly up to date. It says, with regard to pig iron:
The production of pig iron in Canada from domestic and imported ores during 1923 was 880,018 long tons valued at approximately $20,117,000 as compared with 383,057 tons in 1922, an increase of 490,961 tons, or 130 per cent.
Then, steel ingots and castings:
The cumulative production of steel ingots and castings in Canada for the twelve months ending December
was 884,770 long tons or 82 per cent over the output of 485,643 tons for the year 1922 and 33 per cent over the 667.484 tons in 1921.
So my hon. friend, who is in that business, will be glad .to know that the scale is running up and that the business is increasing. I repeat that I will carefully look into the observations he has made.


Richard Smeaton White: I do not wish to quote too many figures, but I may point out that the figures that my hon. friend gave for 1922 were practically the same as those that I gave.


James Alexander Robb: I am not disputing the figures, but I took them up to 1923.


Richard Smeaton White: It shows that my figures
were fairly reliable. I appreciate the minister's disposition to look into the matter. He has not, however, made any statement with regard to his taking power to deal with the question of fuel. He intimates that he may be disposed to correct the disability under which industry is labouring. If the duties were all removed on the articles I have mentioned it would not be enough to make up for the reduction the Canadian mills have suffered by this tariff item. That is why I am extremely anxious that the minister should consider the matter of the price of fuel and' also that of takirfg power to change the duty to whatever point he may see fit before the next session.


James Alexander Robb: I may say that my colleague, the Minister of the Interior (Mr. Stewart), under whose department the mines and minerals come, has under consideration the question of fuel, and I imagine he -will be prepared to submit some recommendations before the close of parliament which we hope will cheapen the coal to all the people of that part of central Ontario where coal is high.


Mr. COOTE:: While we are putting on
Hansard the figures in regard to the steel industry I would like also to give some figures in connection with the Steel Company of Canada, Limited, mentioned by the hon. member for London (Mr. White). I find in the issue of the Fanners' Sun of October 15, 1921, a statement. with regard to the amount of watered stock in some of our Canadian concerns. With respect to the Steel Company of Canada, Limited, the table shows that this company is made up of an amalgamation of the following concerns: Hamilton Steel and Iron Company, Canada Screw Company, Canada Bolt and Nut Company, Montreal Rolling Mills, and the Dominion Wire Manufacturing Company. Their

Ways and Mearn-Customs Tariff
total capitalization had been $9,969,500 at the time of the amalgamation, a considerable portion of this amount being represented by common stock. The stock issued to these different concerns by the Steel Company of Canada at the time of the amalgamation consisted of the following:	Common stock,
811,500,000-


Mr. McMASTER:: The promoters took
most of that.


George Gibson Coote: Preferred stock, $6,496,300;
bonds, $7,500,000, a total of $25,496,300. That is a statement of the stocks and bonds issued upon the amalgamation in payment of the properties of these other companies, which had a total capitalization of $9,969,500. In other words, this $9,969,500 grew almost overnight, or in the process of a week, to $25,496,000, and the Steel Company of Canada are now endeavouring to make earnings enough to pay dividends on this immense amount of water that was injected into their stock at that time. According to their last statement which I find in the Journal of Commerce of May 15, 1924, they are succeeding wonderfully well. Here is the statement:
Manufacturing profits for the year ending December 31, 1923, after deducting charges for repairs, maintenance and providing for income tax, 1923, but before providing for
depreciation and bond interest	$2,996,580 10
Interests and income from securities and investments	 287,887 71

Less Reserves-	[DOT]	,
Bond sinking fund	$277,651 52
Depreciation	 677,236 93

 954,888 45

Less interest on bonds	 441,962 96

Less Dividends-
Preferred	at	7	per	cent	per
annum	$454,741 00
Ordinary	at	7	per	cent	per
annum	 805,000 00


Richard Smeaton White: I suppose the remarks of
the hon. member for Macleod were intended to be an answer to what I have put on Hansard. The hon. member must recall that the war has intervened, and that during the progress of the war the companies who make the larger kinds of steel were flooded with orders; they increased their capacity very greatly, and made very large profits. The statement my hon. friend has read I know nothing about. I know nothing about whether they have any watered stock or not, but I do say that that statement does not indicate the probable progress of the company considering the changes made in the tariff, and the future as it stares us in the face at the present time.


Andrew Ross McMaster: Would the hon. member care to answer this question before he sits down? He read a very interesting letter- from one of his customers, I take it-in which the customer asked him rvhether he was prepared to meet the new conditions. Would it be unfair to ask the hon. member whether he was prepared to meet the new conditions?


Richard Smeaton White: I will read the reply, for the hon. member's benefit:
We have your favour of May 7th in regard to material for threshing machines. As the situation stands at present we are rather uncertain as to just what relief we are going to get. The government, we believe, has under consideration some relief for the steel mills, and if this comes through we shall probably be in a position^ still t'o retain your business.


[Stage Direction]
Item agreed to.
Customs tariff-446. Cultivators, harrows, horse-rakes, seed-drills, manure spreaders and weeders and complete part thereof: British preferential tariff, free: Intermediate tariff, 74 per cent; General tariff, 74 per cent.
James Alexander Robb: The present rates are 10,
12| and 12i per cent. We propose to make the rates free for the British preference, 7i

Ways and Means-Customs Tariff
and 7j>
per cent. The estimated reduction in revenue is $10,277. There was imported for consumption during the fiscal year ending March 31, 1923, a total of $205,554, of which $442 was from the United Kingdom and the balance from the United States. The Canadian production for the calendar year 1920, which are the last figures available, was $7,534,254, and there was exported $1,433,772 worth.


[Stage Direction]
Item agreed to.
Customs tariff 446a-Traction ditching machines (not being ploughs) adapted for tile drainage on farms, valued by retail at not more than three thousand five hundred dollars each, and complete parts thereof for repairs: British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: This is to increase the
value for admission. These machines are admitted free under the act as at present, but only up to the value of $3,000. We propose to increase that to $3,500 to meet the increased cost of production and improvements in the machines. Just in that connection may I remind my genial friend that in 1913, when this government was not in power, this concession was made admitting these machines free. In 1914 the act was amended by admitting the parts free, but there was no consideration at that time such as we are giving now to the implement manufacturers in Canada. I just say that by way of reminding my hon. friend that we are trying to do what is right.


Henry Lumley Drayton: Is it my hon. friend's suggestion that we did what was wrong before?


James Alexander Robb: No, we are profiting by the experience of the past.


Henry Lumley Drayton: I do not know that you have profited very much if your experience has been the same as ours, or that the country was helped very much at that time. I think you will find you are wrong altogether.


James Alexander Robb: Does my hon. friend think we are making a concession that will not be appreciated?


Henry Lumley Drayton: I do not know. That has not been our experience, nor has it been our experience that the country has been helped.


Mr. KELLNER:: Does this apply to a
ditching machine that is not drawn by horse power?


James Alexander Robb: This only applies to the traction ditching machine, I am told.


Henry Lumley Drayton: It does not
apply to ploughs at all.


Donald Ferdinand Kellner: I should like to ask the minister why he discriminates against the machine that is drawn by horse power?


James Alexander Robb: Does my hon. friend say that ditching machines drawn by horses are used to any extent in Canada?


Donald Ferdinand Kellner: I not only say that, but I think I sent the minister a letter about it very recently making a request that these machines be admitted free. I am sorry he has not paid any attention to my request.
I further understand that practically the only ditching machine that is used in agricultural districts is drawn by horses. It is used extensively in the spring for draining rolling land, and I think in many sections it enables the work of seeding to start a week or ten days earlier than would otherwise be possible. I submit in all fairness these machines should be admitted free along with the others.


Thomas Wakem Caldwell: Are they made in
Canada?


Donald Ferdinand Kellner: No, they are not made anywhere in Canada. The traction machine could not possibly be worked over such ground as I have in mind because the soil would be too soft to carry the engine.


James Alexander Robb: I will look into the matter
again.


Mr. WARD:: Is it not possible there may be a misunderstanding. There is a ditching machine and there is a grading machine. Possibly there has been some confusion of terms.


James Alexander Robb: At any rate I will look into the matter.


Mr. FANSHER:: I wish to correct a misapprehension on the part of my hon. friend (Mr. Kellner) who has just spoken. I think perhaps he is in error when he says that practically the only ditching machine that is used in agricultural districts is one drawn by horses. In Ontario a large number of traction ditching machines are used for making trenches for tile drains. I think the ditching machind that the hon. member refers to is what is known as the Martin ditcher. It is something in the shape of a double mould plough and does not cost anything near the amount that one of these power driven machines costs.


[Stage Direction]
Item agreed to.
Customs tariff-446b, ploughs and complete parts thereof, British preferential tariff 5 per cent; Intermediate tariff, 10 per cent; General tariff, 10 per cent.
2486	COMMONS
Ways and Means-Customs Tariff
James Alexander Robb: The present rates are 10 per cent, 15 per cent and 15 per cent. We propose that the new rate shall be 5 per cent, 10 per cent and 10 per cent. The estimated reduction of revenue is $35,436. There was imported for consumption during the fiscal year ending March 31, 1923, $708,769, of which $40 came from the United Kingdom.


Henry Lumley Drayton: All the rest of the importations from the United States?


James Alexander Robb: Yes, all the rest from the
United States. The Canadian production in 1920 was-I want my hon. friends to listen to this-$4,773,593, and the exports of 1921 were $3,628,385.


Andrew Ross McMaster: Three-quarters of the total production exported?


James Alexander Robb: Yes, in that year. The production in 1922 though dropped considerably. The production in 1922 was $1,696,589, and the exports in that year amounted to $1,086,411.


Henry Lumley Drayton: What were the figures last year?


James Alexander Robb: I have not got the figures for last year.


Andrew Ross McMaster: When the minister
states that the loss of revenue will be so much, is that reckoning the importation to be the same as the year before?


James Alexander Robb: Yes.


John Evans: This machinery should have been placed on the free list. Those who are using these implements have to compete with their products with cheaper labour in the world's market, and it would be only fair to place an implement like this, which is so largely used in agriculture, on the free list. During the war the price of this machine went up about 90 per cent and has not come down to any appreciable amount, although steel is cheaper than at the time the raise took place. To-day the agriculturist is in a state bordering on despair owing to the shortage of ploughs. Throughout the three prairie provinces the old implements have been patched up during the last five or six years and owing to the want of new material, agriculturists are conducting their operations in a way that is far from economical. I would urge the minister to consider placing this implement on the free list.


James Alexander Robb: From a first glance at the exports it would look possibly as though there might be something in what my hon. friend has said, but I think it has been clearly de-
monstrated here this afternoon that wdien you make a change with respect to one article you are also affecting a long list of raw materials that go into its manufacture. It seems to me what we propose here is a pretty fair concession.


Mr. LUCAS:: Would the minister explain why there is such variation in tariff rates as between different agricultural implements?


James Alexander Robb: The question of raw material has to be considered. For example, there is more steel used in the manufacture of a plough than a threshing machine.


Mr. WARNER:: Are there any ploughs
coming in from England under the preferential [DOT]tariff?


James Alexander Robb: The importation last year
amounted to $40.


George Gibson Coote: Would the minister be good enough to explain why he reduces the duty on grain separators and parts to 10 per cent and makes no reduction in the duty on steam tractors and large gasoline tractors costing over $1,400 which are necessary to furnish the motive power for threshing.


George Newcombe Gordon: That has no reference to this item at all. Shall the item carry.


[Stage Direction]
Item agreed to.
Customs tariff-447a. Gas or gasoline traction engines for farm purposes, valued at not more than fourteen hundred dollars eaeh, and complete parts thereof; traction attachments designed and imported to be combined with automobiles in Canada for use as traction engines for farm purposes and parts thereof for repairs; British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: I have an amendment to propose that the word "repairs" be struck out and the word "complete" be added before the word "parts".


Henry Lumley Drayton: What was the revenue from parts now made free?


James Alexander Robb: There was not anything.


Henry Lumley Drayton: Nothing collected?


James Alexander Robb: No, sir.


Thomas Wakem Caldwell: The words "complete
parts" take the place of the word "repairs"?


James Alexander Robb: Yes.


Thomas Wakem Caldwell: What is the effect of
that?


James Alexander Robb: It broadens out the item.


Thomas Wakem Caldwell: Would you not take
it to mean that a man had to get complete parts to entitle him to the reduction?

Ways and Means-Customs Tariff


James Alexander Robb: No, it is simply broadened
out for administrative purposes.


George Gibson Coote: What is the rate of duty on tractors costing more than $1,400?


James Alexander Robb: 
George Gibson Coote: Can the minister give any
reason to justify his action in putting tractors under $1,400 on the free list, and leaving large tractors subject to 17i per cent duty?


James Alexander Robb: I think this is a fair concession and that it is based upon the requirements of the country.
Mr. COOTE; Does the minister say he has made any concession in regard to large tractors?


James Alexander Robb: No, I take this item as I
find it. I am broadening out the importation of parts.


George Gibson Coote: Mr. Chairman, I would
point out to the minister that his attitude is a little unreasonable and that his answer is not very satisfactory to the people who must buy these tractors for their threshing outfits. One man in my constituency told me last year that he had paid $1,100 hard cash in duty alone on a large tractor. These large outfits wear out and must be replaced, and with grain at its present price the threshers cannot afford to pay the prices now being asked for large tractors. Let me draw the minister's attention to this fact. Last year, although we raised 70,000,000 bushels of wheat in the West more than in 1922, the estimated return was $25,000,000 less. The farmers must have cheaper threshing outfits. The present duty on these large tractors is prohibitive.


James Alexander Robb: Mr. Chairman, I will look
into what my hon. friend has said. But let me say to him that western Canada is not suffering because of increased cost of threshing outfits due to the tariff; it is suffering from higher labour costs. In 1911 grain was threshed in western Canada for six cents a bushel, and last year the cost had risen to thirteen and fourteen cents a bushel-not on account of the tariff, but because of the increased cost of labour.


George Gibson Coote: Mr. Chairman, we were
suffering in 1911 from the duty, but we were in a better position to stand it than we are to-day. With the price of wheat and other grains so low we cannot stand the present prohibitive tariff on large tractors. I cannot see how the . minister can justify his attitude in putting the small tractors on the free
list and retaining a duty of 174 per cent on large tractors, and only 10 per cent on ploughs, 10 per cent on grain separators and 6 per cent on binders. It is just as necessary to have a tractor to run the separator as it is to have the separator itself; you cannot run the latter by hand power. It is not helping the farmer to meet the situation for the minister to say that the trouble is due to the increased cost of labour.


James Alexander Robb: It is largely due to the increased cost of labour.
Mr. FANSHER. What is the proportion of tractors under $1,400 that come in as compared with tractors -valued over, 'that figure?


James Alexander Robb: I have not that information
handy, but I will have it looked up for my hon. friend.


Thomas Wakem Caldwell: Allow me to revert to
complete parts. I am still not clear on this, and I do not think it will be clear to the customs officials. Why not say "and all parts thereof for repairs"? If you take this literally, it means that a man would have to buy complete parts before he would get them free.


James Alexander Robb: It is the same wording as we have had in connection with agricultural implements, and I have never heard of any somplaints there.


Thomas Wakem Caldwell: If you will assure us
there will not be any trouble, we will be satisfied.


James Alexander Robb: Yes.


Mr. MILLAR:: I would add to the appeal made by the hon. member for Macleod (Mr. Coote). In principle, in regard to such things as motor cars, it would seem to be wise to distinguish between those that are expensive and those that are low priced; but when it comes to threshing machines it is otherwise, because the poor man must engage a threshing outfit consisting of a large engine and a large threshing machine. I know of cases in the last two or three years when the costs of threshing have been so high that the thresher was ashamed to take payment and voluntarily made concessions, because he saw the bill would take almost the value of the entire crop. I think it would be well for the minister to give serious consideration to this matter. What he has said about the increased cost of threshing being largely due to the increased cost of labour is in part true, but that is something we cannot entirely control, and I cannot see any hope in
248S	COMMONS
Ways and Means-Customs Tariff
the very near future that that cost is going to be materially reduced. I think the minister has it within his power now to materially reduce the cost of threshing by removing a part of the protection on large threshing outfits.


James Alexander Robb: For the information of my
hon. friend from East Lambton (Mr. Fan-sher), the importations of tractors that came in free were $2,854,428, while the importations dutiable-which my hon. friend from Macleod (Mr. Coote) complains	ofamounted to $129,169. I will look into the observations of my hon. friends and consider them later.


Thomas Wakem Caldwell: What was the production in Canada of the same engines?


James Alexander Robb: I have not got that information.


Thomas Wakem Caldwell: I think it will be generally admitted that the tariff which increases the price of the imported machine also increases the price of the machine made at home. Therefore if we had the home production we would know how the duty affects the man using the large tractor.


James Alexander Robb: I will get the information.


[Stage Direction]
Item agreed to.
Customs tariff-447b. Wind-stackers, and threshing machine separators, including baggers, weighers and selffeeders therefor, and complete parts thereof:	British
preferential tariff, 5 per cent; Intermediate tariff, 10 per cent; General tariff, 10 per cent.
James Alexander Robb: The present rates are 10, 15
and 15 per cent. We are reducing them to 5, 10 and 10 per cent. The estimated reduction in revenue will be $112,907. The imports for consumption during the fiscal year ending March 31, 1923, were $2,258,156- all from the United States. The Canadian production in 1920 was, $3,818,080. The exports for 1921 were $818,052.


Mr. GOULD:: I think every argument adduced by the hon. member for Macleod is applicable to this item, particularly to the threshing machine. I have often wondered why, when consideration was given in 1914 to tractors under $1,400, it was not extended to the partner machine, that is the separator necessary to complete a threshing outfit with that class of engine. Back in the early days -I am speaking now of the West-we had generally very very large threshing machines, ' and the labour market in those days provided sufficient men to operate them. I remember in the early days when threshing did not cost even six cents a bushel, but of course later 
on the cost increased materially. In passing, I want to call this to the attention of the minister, that because there is a cost of 6, 10 or 15 cents a bushel for threshing, it does not necessarily mean that that is the total cost, because over and above that we have to provide feed and board for ten or twelve and sometimes even as many as eighteen or twenty men. So the cost of 6, 10, or 15 cents a bushel does not represent the actual cost to the farmer. When the established farmer sees the necessity, he is obliged to secure the smaller outfit which he and a couple of hired men whom he engages in the harvest can handle completely, having his wagons there, and it is only a matter of justice that this government should now make provision for the size of separator that would correspond well with the tractor that is now let in under the $1,400 valuation, making a cheaper unit for the individual. I feel quite sure that the revenue would be increased as a result, simply because so many farmers throughout the country would purchase these separators, making the complete threshing outfit, wffiereas at the present time the tendency is for farmers, who think they may have work for the small tractor, to go out of the business. This would keep up the sale of the tractor and also increase the sale of the separator. Through that it would increase the revenue to the country. I hope the minister will take that into consideration. It is quite serious to us in the West.


Robert Forke: I notice that in this list you have baggers at 6 per cent duty and on the other list the duty is 10 per cent. There must be some mistake on one of the lists. I see that one is the selling price to the purchaser. I see the difference.


Henry Lumley Drayton: Perhaps the
hon. member for Assiniboia (Mr. Gould) will show us how we are going to help the revenue by the addition of free separators to these free tractors. It will be interesting.


Oliver Robert Gould: We have heard complaints in this House, in fact, figures have been cited many times, not only this year, but in previous years, that we are not able to pay our share of income taxes. If we have some cash to ourselves, as we have a right to expect the same as other industries, possibly we may be able to meet our obligations. Until that time arrives and we are not allowed to retain to ourselves our proper share of the revenue produced, we shall feel injured and consequently be open to the charge that we do not pay our share of the

Ways and, Means-Customs Tariff
income tax. We are hoping for the day- and the smile which is always upon the face of the hon. member for West York (Sir Henry Drayton) means, I know, that he believes, as I do, that the day is not far distant-when we shall be out of the sad condition we are in at the present time and able to hold our end up.


Henry Lumley Drayton: If such a little thing as that would result in my hon. friend paying income tax, I think we would all hold up both hands for it. I am afraid this will work out that a number of other people will be prevented from paying income taxes. The collections are coming down anyway.


Oliver Robert Gould: I should like a statement from the minister -whether the government have considered the question which I have brought up.


James Alexander Robb: The government carefully
considered these items from all angles before bringing down this legislation, and we propose to stand by this legislation as it is.


Robert Forke: The list says "the following articles when imported by manufacturers of goods". It goes on to enumerate the goods. Amongst those is a bagger for a separator.


James Alexander Robb: I suppose the inference must be, if my hon. friend will allow me, if it is imported by the manufacturer to go into the machine.


Robert Forke: But is it imported as a whole as a bagger?


James Alexander Robb: I do not think so.


Robert Forke: The list says: "The following articles when imported by manufacturers of goods."


James Alexander Robb: It might be.


Robert Forke: Then, why should the duty be 6 per cent in the one case and then when he puts the bagger on the separator, the duty becomes 10 per cent?


James Alexander Robb: The general item is in this for this reason:	We are making a balancing
of concessions. In considering the reductions we are making on all agricultural implements and then the reductions on materials that will go into those, my hon friend will realise that we must strike a balance. We cannot afford to put the manufacturers of agricultural implements out of business altogether. We must strike a balance, and they will probably gain on some items what *they will lose on others.


Robert Forke: I do not see that.


William John Ward: I am sure the minister wants
to be fair, and I hope he accepts the criticism from this corner of the House in the spirit in which it is intended. When he speaks so emphatically as he did a few minutes ago, it is hardly fair. We want to be consistent in these matters, and I think the remarks that have been directed from this corner of the House during the last few minutes are with the intention of pointing out what we consider to be inconsistencies. The minister said a few minutes ago that the tariff was no higher to-day that it was in 1911. That is true, on the price; but the price of a separator is almost double what it was in 1911. I know the minister in his capacity cannot affect the price that may be charged; nevertheless this is one of the burdens of farmers throughout the country, and I think the remarks of the hon. member for Assiniboia (Mr. Gould) were very well directed to this matter. I think the matter might well be reconsidered.


James Alexander Robb: I admit that the cost of implements has gone up. I said a few minutes ago that the cost of implements is one of the contributing factors, but that, in my judgment, the increased cost of labour has added materially to the cost of threshing.


Henry Lumley Drayton: As regards the
increased cost of labour, has the minister gone into the question, for example, in connection with the calculations made in the United States? Does he agree with, or is there any foundation for, the statement that it costs 42 cents a bushel less to raise wheat in Canada than it does in the United States? Has he gone into that question at all in connection with these costs? I am aware that there is an average difference upon the same average haul. What I mean by that is this:	If you
take the crop of Canada and move it at the American rate, there would be a resultant additional expense, if I remember rightly, of nine decimal something cents a bushel to the Canadian farmer. That is one of the things that the American authorities, I think, have considered in that calculation, but it falls very short of establishing a difference of 42 cents in favour of the Canadian farmer, it seems to me that this is a matter which the government should take cognizance of one way or the other.


James Alexander Robb: The statement just made by
my hon. friend as to the relative cost of producing wheat in Canada and the United States may be absolutely correct. I am not disputing that.
2490	COMMONS
Ways and Means-Customs Tariff


Henry Lumley Drayton: I do not know whether it is correct or not. I would be rather inclined to dispute it.


James Alexander Robb: That does not alter the fact
that the grain grower in western Canada is not in a good position; that he is not prosperous. We recognize that some concession must be made.


Henry Lumley Drayton: I was not arguing that he was.
Mr, CALDWELL: I think I can help the hon. member for West York (Sir Henry Drayton) somewhat in this matter. The New York authorities had an investigation as to the growing of potatoes in Canada and the United States, and they found to their surprise that potatoes could be grown much cheaper in Canada than in the United States. This is how they arrived at that. I pointed out yesterday-and the statement cannot be refuted-that at that time we were paying ten dollars a ton more for fertilizer than in Maine just opposite to us where the test was made. As we use a ton to the acre, that is quite an item before you begin to plant. Our machinery also costs us more; but the way they figured that it costs more to grow potatoes in Maine than in New Brunswick is that they value land at $200 an acre in Maine and $20 an acre in New Brunswick, and they take into consideration interest on the investment. What was the' reason why land that was worth $200 in Maine was worth only $20 in New Brunswick, when it was identically the same on either side of the line? These farms extended along the border for some 25 miles on either side and yet there was this disparity in the prices of the land. The reason is simply that they can get more for their crops over in Maine. The farms in Maine yielded no more per acre; the land was no more fertile, and from this standpoint there was no reason for the difference in the respective prices. Owing however, to the fact, as I showed yesterday, that they could get in Maine, for every 5,000 barrels of potatoes they produced, $4,250, more than the farmers in New Brunswick could obtain for the same crop produced on the same area, the land was certainly worth more across the line. Then again the man who planted 50 acres paid for his fertilizer, if the difference was $10 a ton-and I think I showed yesterday that in sqme cases it was $13.95 in one year- $500 less for a sufficient quantity for that 50 acres than the New Brunswick farmer would have to pay. Nothwithstanding this, it seems that by the usual process of calculation they 
can figure a cheaper production in New Brunswick than in Maine. There is an old saying that figures will not lie but liars will figure.


[Stage Direction]
Item agreed to.
Customs tariff-448. Spraying machines, fruit or vegetable grading machines, incubators for hatching eggs, brooders for rearing young fowl, pruning hooks, pruning shears, hay loaders, potato-diggers, fodder or feed cutters, grain crushers, fanning mills, hay tedders, farm or field rollers, post hole diggers, snaths, milking machines, milking machine attachments; centrifugal machines for testing butter fat, milk or cream; stumping machines and other agricultural implements, n.o.p., and complete parts of articles specified in this tariff item: British preferential tariff, 5 per cent; Intermediate tariff, 10 per cent; General tariff, 10 per cent.
James Alexander Robb: The present rates are 10 per cent, 15 per cent, and 15 per cent; we propose a reduction to 5 per cent, 10 per cent, and 10 per cent. The estimated reduction in the revenue is $23,606. There was imported for consumption during the fiscal year ended March 31, 1923, a total of $452,136, made up
as follows:
From the United Kingdom	 $ 11,638
From	the United	States	
439,827From	France	
252From	Switzerland	
342From	the Netherlands	
77


Thomas Wakem Caldwell: What was the production in Canada?


James Alexander Robb: I have not the information.


Thomas Wakem Caldwell: Before this item passes I wish to know what production there was in Canada during the past year of spraying machines, fruit or vegetable grading machines, potato diggers, and potato sprayers. I am informed, on what I take to be good authority, that there are none of these articles manufactured in Canada at all; and if that were the case, while I would not have the hardihood to ask the minister to change the schedule which he is now presenting, seeing that he had made a good reduction this year. I would ask him to look into the matter carefully, because if none of these machines are made in Canada, as I am informed by a farm machinery firm that there are not, the minister might consider seriously putting these items on the free list.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


George Newcombe Gordon: Customs tariff, item
448, spraying machines, and so forth.


James Alexander Robb: The present rates are 10
per cent, 15 per cent and 15 per cent. We propose to reduce these to 5 per cent, 10

Ways and Means-Customs Tariff
per cent and 10 per cent. The estimated reduction in revenue will be $23,606. The value of the imports for consumption during the fiscal year ending 31st March, 1923 was $452,136, of which $11,638 was from the United Kingdom, $252 from France, $342 from Switzerland, $77 from the Netherlands and $439,827 from the United States.


[Stage Direction]
Item agreed to.
Customs tariff-449. Axes, scythes, sickles or reaping hooks, hay or straw knives, edging knives, hoes, rakes, n.o.p.; and pronged forks:	British preferential tariff,
10 pe rcent: Intermediate tariff, 15 per cent; General tariff, 20 per cent.
James Alexander Robb: The present rates are 15 per
cent, 20 per cent and 221 per cent; we propose to reduce these to 10 per cent, 15 per cent and 20 per cent. The estimated reduction in revenue is $763. The value of goods under this head imported for consumption under the preferential tariff was $8,275, under the general tariff, $13,979, a total of $22,254.


Henry Lumley Drayton: From what
country were the goods to the value of $13,979 imported?


James Alexander Robb: From the United States, I
imagine, under the general tariff.


John Evans: These tools are in everyday use by all farmers. They went up in price during the war and since; some of them are now over 200 per cent dearer than they were in pre-war days. Considering the state of agriculture; considering that the farmer has to find a price for his products against the competition of the cheap labour of the world, particularly of Europe and of Asia, it is only fair that tools of this kind, which are nothing more than the raw material of the farmer in the production of his goods, should be placed on the free list. I would ask the minister to consider this suggestion. Perhaps he would have the item left over with that end in view.


James Alexander Robb: No, I am not disposed to
offer any further reduction at this session. We must keep in mind that the government require revenue for carrying on the affairs of the country. There is a considerable reduction here in the British preferential and intermediate duties.


[Stage Direction]
Item agreed to.
Customs tariff-450. Shovels and spades of iron or steel, n.o.p.; shovel and spade blanks, and iron or steel cut to shape for the same:	British preferential
tariff, 10 per cent; Intermediate tariff, 15 per cent; General tariff, 20 per cent.
James Alexander Robb: The present rates are 20 per
cent, 30 per cent and 32i per cent; we propose reducing these to 10 per cent, 15 per cent, and 20 per cent. The estimated reduction in revenue will be $2,191. Imports for consumption during the fiscal year ending 31st March, 1923 were: Shovels and spades, under the preferential tariff, $8,107; under the general tariff, $9,821, a total of $18,628. In addition to that there were shovel blanks imported to the value of $661.


[Stage Direction]
Item agreed to.
Customs tariff-450a. Lawn mowers: British preferential tariff, 20 per cent; Intermediate tariff, 30 per cent; General tariff, 321 per cent.
Henry Lumley Drayton: How many lawn mower manufacturing plants have we in Canada, outside of Brockville, and where are the others?


James Alexander Robb: I cannot tell my hon. friend
that. There is no change in this item, and the reason for there being no change is that lawn mowers are not implements of production. My hon. friend, I suppose, like myself sometimes regards lawn mowing as a method of taking exercise.


Henry Lumley Drayton: I look upon it more or less as a penalty; it used to keep me from baseball.


[Stage Direction]
Item agreed to.
Customs tariff-453b, Machinery for sawing lumber, up to but not including the point of planing, and complete parts thereof, not to include motive power; machinery, logging cars, blocks and tackle, and complete parts thereof, for logging purposes exclusively: British preferential tariff, 10 per cent; Intermediate tariff, 15 per cent; General tariff, 20 per cent.
James Alexander Robb: The present rates on sawing
machinery are 15, 22J and 25 per cent; on logging machinery, 15, 25 and 27i per cent. There are some other classes under which these goods come in, ranging from 20, 27| and 30 per cent; 20, 22J and 25 per cent, to 22J, 30 and 35 per cent. We propose reducing these classifications to 10, 15 and 20 per cent. The estimated reduction in revenue will be $40,777. The estimated reduction on sawing machinery will be $65,402. There is no separate classification of imports of logging machinery.


Henry Lumley Drayton: Where do the
imports come from?


James Alexander Robb: For the year 1923, lumber
sawing machinery from the United Kingdom, $254, and from the United States, $65,148.


Henry Lumley Drayton: If the imports were only $254 and $65,148, how do we get a

Ways and Means-Customs Tariff
loss in revenue of 840,777? There is something wrong with the minister's figures. Has the minister any idea of the imports of logging machinery?


James Alexander Robb: About 8100,000.


Henry Lumley Drayton: All from the
United States?


James Alexander Robb: Yes.


[Stage Direction]
Item agreed to.
Customs tariff-453c. Ore crushers, rock crushers.
stamp mills, rock drills, percussion coal cutters, coal augers, rotary coal drills, and complete parts of all articles mentioned in this item, when for use exclusively in mining operations:	British preferential
tariff, 10 per cent; Intermediate tariff, 15 per cent; General tariff 20 per cent.
James Alexander Robb: The present rates are 15, 25, and 27| per cent. We propose 10, 15 and 20 per cent. The estimated reduction in revenue is 857,077. Imports for consumption during the fiscal year ending March 31, 1923, totalled 8823,980.


Henry Lumley Drayton: How is that
distributed?	.


James Alexander Robb: Sixty-seven thousand dollars from the United Kingdom, and 8756,332 from the United States.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the following be inserted after tariff item 453c:
Customs tariff-453d. Steel dies, of a class or kind not made in Canada, valued at not less than one thousand dollars each, for use exclusively in stamping metal sheets or metal plates. Provided that such dies shall be exported from Canada under Customs supervision within three months from the date of import entry:	British preferential tariff, free; Intermediate
tariff, free; General tariff, free.
The estimated reduction in revenue is 835,000. These dies are of special design, and the small consumption in comparison with the United States makes the operation very expensive. These dies are used for only a short period, and1 it was considered advisable to reduce the duty, as an industry of very large proportions is threatened with being closed.


Mr. ROSS (Simcoe):: Who are these firms?


James Alexander Robb: There is the Fisher Body Company, making bodies for automobiles.


Arthur Edward Ross: That is Henry Ford's now.


Henry Lumley Drayton: Can the minister tell us exactly how that is? How it works out is simply this, that no duties whatever will be paid on these stamping machines. It is an old question, and the minister is right in

pointing out the difficulties of business. It is only a tardy recognition of what we have often said. These are expensive machines, and our production here is such that I think I am within the mark in saying that most automobile companies could stamp all their bodies perhaps within six weeks; so they will just- bring the machinery in and take it out again. The disability is one of overhead. In the United States, with mass production, instead of having these stamping dies going for only a month or six weeks, they would have them going all the time. But I would have thought, Mr. Chairman, that with the present tariff protection on automobiles, which is high, the country could get a little revenue out of this operation; but apparently we are to lose it in connection with a highly protected industry.


James Alexander Robb: As my hon. friend has said, these machines are used for only a few days, but this reduction will place Canadians in a position to meet competition in export markets. My hon. friend must recall that we get a revenue from other sources; the more business they do, the more the export, the more revenue we get fromf these concerns. As regards the high duty on automobiles, that has often been pointed out, and it is true; but I think this is a fair source from which to get revenue. As my hon. friend knows, automobiles are imported of a special design by people who are ready to pay a high price for them, and I do not see why they should not contribute something to the revenues of this country. It is rather difficult to differentiate in the duties on automobiles as between the lower priced and the higher priced cars.


Henry Lumley Drayton: I am glad to
see my hon. friend now thinks it is worth while to manufacture for export. Of course the whole reason for our being so extensively in that business to-day, or rather the major reason is the preference given in Great Britain. I should like to know if my hon. friend is going to make any representations whatever to the British government in connection with the McKenna duties.


James Alexander Robb: No, the position I take is that we would not like the British government to dictate to us what policy we should adopt in Canada. We feel that this country has been the pioneer in the matter of preferential tariffs. My hon. friend will recall the preferential tariff that was introduced many years ago in Canada by the present Minister of Finance, and which has been increased from year to year. We do believe in this country in the idea of preferential tariff but we do

Ways and Means-Customs Tariff
not like to go so far as to dictate to the Mother Country or to a sister dominion, how they should frame their tariff policy, because we recognize that if we were to do so they might some day come along and attempt to interfere with our tariff, and I am sure we would resent that.


Henry Lumley Drayton: My hon. friend quite understands that there is no dictation about the matter at all, not the slightest. What has he been doing himself in connection with Australia? He is not giving Australia a preference right through. No he is trying to get some mutual understanding under which Canadian commerce will thrive and under which Australian commerce will thrive. I am asking him whether he has done in connection with Great Britain just what he is doing in connection with Australia, that is all. I am not asking him to interfere or to coerce, or do anything like that; the mere suggestion is ridiculous.


James Alexander Robb: I do not know that I quite
follow my hon. friend. Does he mean that we should say to the British government "Unless you will give us a preference we will withdraw the present preference?"


Henry Lumley Drayton: Mutuality is the whole underlying idea of preferences. The preference was given in the hope that it would be followed; my hon. friend knows that perfectly well. It is his own policy but in the case of Australia he is waiting until he gets more advantage for the Canadian trader in the Australian market. Why not pursue the same policy in regard to Great Britain? My hon. friend is not consistent. He does one thing in connection with Australia, and another thing in the case of the Mother Country.


George Newcombe Gordon: Shall the item carry?


Henry Lumley Drayton: I think we should have a little further explanation as to why one industry was picked out for special exemption in connection with expensive machinery which cannot be used all the time. That is a condition which is not confined to automobiles at all. There are lots of machines in other businesses, as my hon. friend well knows, that are not used in Canada more than a fraction of the time. They are used in rhe United States owing to the mass production there. Here we have a direct admission from the government of what we have always said in connection with this mass production, and we have that admission in connnection with only one activity. That activity I think I can fairly and safely say is 158
the one which ought to be able to stand up best as being perhaps the most highly protected. Now, why does my hon. friend pick this industry out and leave all the others?


George Gibson Coote: I think the ex-Minister of Finance has propounded a very proper question to the minister at this time. Surely he did not need to single out the automobile industry for free dies. He says that the automobile people probably use these machines for only six weeks in the year. Now, the farmer uses his binder about ten days in the year, but he is not singled out for a free binder on that account. I would have no objection whatever to these dies being placed on the free list if the Acting Minister of Finance had done his duty and given us a little reduction in the duty on automobiles. If we have one example in Canada of protection gone mad I think it is in connection with the duty on automobiles. Including additions to plant, and equipment, and dividends paid, the Ford Company of Canada have taken out of the pockets of the people of Canada, something like $30,000,000 in addition to the wages and everything else that they have paid, and it would be really interesting to know to just what extent Canadians have taxed themselves lo establish the automobile industry in this country. According to a publication which I have here, issued by the Toronto Board of Trade, the percentage of the capital invested in the automobile industry in Canada, which is owned in the United States, is 77.7 per cent. That is, we are taxing ourselves to the extent of 35 per cent for the benefit of some American millionaires. I should like to take this opportunity of protesting because the minister has brought down his budget without offering us any reduction whatever on automobiles.


[Stage Direction]
Item agreed to.
Customs tariff-456. Ingot moulds, n.o.p.; glass moulds of metal:	British preferential tariff, 5 per
cent; Intermediate tariff, 7£ per cent; General tariff, 10 per cent.
James Alexander Robb: The only change here is that "n.o.p"-not otherwise provided-is added.


Henry Lumley Drayton: What is the estimated loss of revenue?


James Alexander Robb: I think the next item will show that.


[Stage Direction]
Item agreed to.
Customs tariff-456a. Ingot moulds for use in the production of steel:	British preferential tariff, free;
Intermediate tariff, 5 per cent; General tariff, 7^ per cent.
[Stage Direction]
2494	COMMONS
Ways and Means-Customs Tariff
Henry Lumley Drayton: Have these
amendments been tabled?


James Alexander Robb: Yes. Ingot moulds for use in the production of steel are free under the three classifications. The present rates are 5 per cent, 7^ per cent and 10 per cent. The resolutions of the 30th April, estimated a reduction m revenue of $23,276. There was imported into the country during the fiscal year ending March 31, 1923, $248,198. This is a concession to the manufacturers of steel.


Henry Lumley Drayton: Where are ingot moulds obtained now?


James Alexander Robb: They come principally from the United States, but a few are imported from Great Britain.


Henry Lumley Drayton: Are the imports from Great Britain of any account at all?


James Alexander Robb: My hon. friend will notice that they are all on the free list.


Henry Lumley Drayton: I was wondering what we imported from Great Britain.


James Alexander Robb: From Great Britain, $30,875; from the United States, $217,323.


Henry Lumley Drayton: How many are we producing in this country?


James Alexander Robb: Practically they are not made in this country.


Henry Lumley Drayton: That is entirely a revenue item.


James Alexander Robb: A concession to the steel companies.


Henry Lumley Drayton: What was
collected last year?


James Alexander Robb: We collected $26,276.


[Stage Direction]
Item agreed to.
Customs tariff-460b. Machinery and apparatus for use exclusively in washing coal; machinery and apparatus for use exclusively in producing coke and gas; machinery and apparatus for use exclusively in the distillation or recovery of products from coal tar or gas; and integral parts of all machinery or apparatus enumerated in this item not to include motive power nor tanks for gas:	British preferential tariff, 7£ per
cent; Intermediate tariff, 10 per cent; General tariff, 12£ per cent.
James Alexander Robb: The present rates are 15, 25 and 27J per cent, and 15, 27J and 30 per cent. There are various other rates as well. The estimated reduction in revenue is $150,000. There is no separate classification of the different imports. The estimated imports were $1,000,000. We propose to reduce this to 7i, 10 and 121 per cent. This is done with the hope of establishing coke plants and reducing the cost of fuel to the people.


Henry Lumley Drayton: Where did the million dollars worth of goods come from?


James Alexander Robb: There is no separate classification.


Henry Lumley Drayton: Then how is this loss of $150,000 arrived at?


James Alexander Robb: It is an estimated loss.


Henry Lumley Drayton: Is it an estimate or a guess? If an estimate, what is it based on?


James Alexander Robb: It is an estimated loss on the value of what it might be if three or four furnaces were erected in Canada. My hon. friend will understand that if we did not make the reduction it is quite possible it might delay the establishment of these furnaces in Canada.


Henry Lumley Drayton: This refers also to machinery and apparatus for use exclusively in washing coal. That is something which is being imported. What have we on that?


James Alexander Robb: I have no information.


Henry Lumley Drayton: Have we any idea what we have collected in taxes for machinery and apparatus for use exclusively in washing coal?


James Alexander Robb: No, it is largely an estimate.


Henry Lumley Drayton: Is this a new item altogether?


James Alexander Robb: Yes.


Henry Lumley Drayton: Then under
what item does machinery and apparatus for washing coal now come?


James Alexander Robb: Largely under 453 and 454.


Henry Lumley Drayton: Those are the two omnibus items?


James Alexander Robb: Yes.


Henry Lumley Drayton: Have any
figures been supplied the minister by the coal companies showing what they were bringing in and what they were paying?


James Alexander Robb: No.


Henry Lumley Drayton: No request from the coal companies for this concession?


James Alexander Robb: Representations have been
made to us that if we would make a reduction of this kind there might be some coke plants established in Canada.


Henry Lumley Drayton: That is a new industry. I am speaking now of the present

Ways and Means-Cwtoms Tariff
industries. There have been no figures supplied the minister showing the hardships on industries which might be interested under these items.


James Alexander Robb: No. This is put in to meet
the request from the Fuel Commission of Canada in the hope of getting-


Henry Lumley Drayton: Coke plants
established?


James Alexander Robb: -and reducing the cost of
fuel to the people.


[Stage Direction]
Item agreed to.
James Alexander Robb: 
Henry Lumley Drayton: Has the minister no idea where these imports come from?


James Alexander Robb: Largely from the United
States.


Henry Lumley Drayton: They are practically entirely from the United States, are they not?


James Alexander Robb: There might be a very limited amount from Britain.


Henry Lumley Drayton: It would be
negligible, so we need not worry about it.
Mr, ROBB:	I should say so.


Henry Lumley Drayton: How did this
item come about? The last one we had at the request of the coal commission.


James Alexander Robb: The request came largely
from the steel men. It is a concession to the steel industry in view of the reduction in duties which we are making on their products.
158i	;	jjij


Henry Lumley Drayton: So this is a
further assistance to the steel industry in view of the fact that so many of their products are put on the free list?


James Alexander Robb: Or reduced.


Henry Lumley Drayton: Yes. Where
would blast furnaces for melting iron ore be located? I suppose at Algoma, and at Sydney. Where else, Hamilton?


James Alexander Robb: Yes; and one at Port Colborne.


[Stage Direction]
Amendment agreed to.
James Alexander Robb: I beg to move that the following be inserted after tariff item 460c:
Customs tariff-460d. Machinery and apparatus of a class or kind not made in Canada for use exclusively in handling iron ore and other materials to be charged into a blast furnace, from the dock, car or stock pile, at the iron or steel plant: British preferential tariff, free; Intermediate tariff, free; General tariff, free.
The estimated reduction in revenue will be $25,000. There is no separate classification of imports. We propose to make this item free.


Henry Lumley Drayton: What were the old rates?


James Alexander Robb: Fifteen per cent, 25 per cent
and 27i per cent.


Henry Lumley Drayton: Any manufactured in Canada?


James Alexander Robb: My hon. friend will observe
that this is only for a class of goods that are not manufactured in Canada.


Henry Lumley Drayton: It is another
entirely revenue item.


[Stage Direction]
Item agreed to.
Customs tariff-476a. Steel of No. 20 gauge and thinner, but not thinner than No. 30 gauge, for the manufacture of phonograph motor springs when imported by manufacturers of phonograph motor springs for use exclusively in the manufacture of such articles in their own factories; British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: The present rates are 5 per cent, 12J per cent and 12J per cent. We are putting this on the free list in all classes. The estimated reduction of revenue is $4,000. There is no separate classification of imports.


Henry Lumley Drayton: I have no doubt the minister knows where the imports come from.


James Alexander Robb: From the United States.


Henry Lumley Drayton: Certainly. I
suppose this is another revenue item?


James Alexander Robb: Yes.


[Stage Direction]
Item agreed to.	,
2496	COMMONS
Ways and Means-Customs Tariff
Customs tariff-502b. Bicycle rim strips of maple not further manufactured than bent to shape and jointed: British preferential tariff, 10 per cent; Intermediate tariff, 12} per cent; General tariff, 15 per cent.
James Alexander Robb: The old rates were 17J per
cent, 221 per cent and 25 per cent. The estimated reduction in revenue is $5,000. There is no separate classification of imports. This is a concession to manufacturers of bicycles in Canada.


Henry Lumley Drayton: Have we woodworkers engaged in making bicycle rims in Canada?


James Alexander Robb: No, only in the rough. Most of this stuff is imported now.


Henry Lumley Drayton: Where from?


James Alexander Robb: Largely from the United
States.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the following be substituted for tariff item 502e:
Customs tariff-502c. Wood handles or steins for handles, not further manufactured than turned, when imported by manufacturers of goods enumerated in tariff items 448, 449 and 450 for use exclusively in the manufacture of goods enumerated in said items: British preferential tariff, free; Intermediate tariff, free; General tariff, free.
The old rates are 17J per cent, 22| per cent and 25 per cent. The estimated reduction in revenue is $40,000. There is no separate classification of imports. The estimated imports are $110,000.


James Arthurs: Are these goods manufactured in Canada?


James Alexander Robb: No.


Henry Lumley Drayton: I have the
original resolution in which this item does not appear. Then I have the amendment of 502c which reads:
Wood handles or stems for handles, not further finished than turned, when imported by manufacturers of shovels for use exclusively in the manufacture of shovels.


James Alexander Robb: If	my hon. friend will look
at the resolutions of the 12th May, he will find that this is amended from what my hon. friend is quoting.
Sir HENRY' DRAYTON:	Then, there is
an amendment to the amendment. Perhaps my hon. friend will tell us what new light he had when he brought in the amendment to the amendment,


James Alexander Robb: It was represented to us
by manufacturers of these goods that we have taken some duty off them and they wanted some other concessions. We thought their representations were fair.


Henry Lumley Drayton: Does my hon. friend now state that these are not made in Canada?


James Alexander Robb: I do not say that they are not made in Canada but they are becoming very hard to get and they are largely imported.


Henry Lumley Drayton: Where are they made in Canada?


Mr ROBB:: I think my hon. friend will agree with me, as he has had some experience, that a great deal of this wood is now imported from Indiana. This class of wood is becoming scarce in Canada.


Henry Lumley Drayton: What is this class of wood?


James Alexander Robb: Hickory and ash. I hope my hon. friend does not object to this item.


Henry Lumley Drayton: I am trying to find out something about it. I think I have registered objections pretty well. If my hon. friend wants some more, I will let him have them. Is this merely hickory? I think it is ash chiefly.


James Alexander Robb: It is ash chiefly.


Henry Lumley Drayton: I thought we had plenty of ash. I am afraid my hon. friend has no information. I think they are manufactured in Canada and that importation will be largely from the United States, will it not?


James Alexander Robb: Largely from the United
States.


An hon. MEMBER:: Only shovel handles are mentioned in this. There are other handles that are just as important, such as axe handles and so on.


James Alexander Robb: The amendment is to provide for handles for hoes, forks and other farm tools.


[Stage Direction]
Item agreed to.
Customs tariff-506a. Crutches or specially constructed staffs for a cripple:	British preferential tariff, free;
Intermediate tariff, free; General tariff, free.
James Alexander Robb: The present rates are 174 per cent, 22J per cent, 25 per cent. We are putting them on the free list.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the following be substituted for tariff item 533b:
Customs tariff-533b. Linters of short fibres of cotton, bleached, when imported by manufacturers of paper to be used only in their own factories for the manufacture of blotting paper or other grades of paper: British preferential tariff, 7} per cent; Intermedia*-tariff, 10 per cent; General tariff, 12} per cen*

Ways and Means-Customs Tariff
The present rates are 15 per cent, 22J per cent, 25 per cent. We propose reducing these to 7i per cent, 10 per cent and 121 per cent. The estimated reduction in revenue will be about 15,000. This material is principally used in the manufacture of blotting paper. In this connection I should like to be fair to hon. gentlemen who are associated with the Canadian Manufacturers' Association. It has sometimes been pointed out to us that the manufacturers of Canada are opposed to any reductions in the tariff. That rule does not always hold, because this reduction in tariff is given to meet a request that came to us through their representatives. This is the item I referred to in the course of the afternoon in regard to which we were asked to make a reduction by order in council. I declined to do that but suggested that as parliament was meeting early it was preferable to bring the matter to the attention of the House. It was brought to our attention through a gentleman who I think has a right to speak for the Manufacturers' Association. The companies interested1 are the Howard Smith Paper Mills, The Provincial Paper Mills and the Rolland Paper Mills. Hon. gentlemen will I think agree that Mr. Howard Smith has some warranty for speaking on behalf of the manufacturers of Canada, he being himself president of the association at the present time. So that it is only fair to him to say that he is not always opposed to reductions in the tariff.


Mr. BOYS:: It would be interesting to know why the manufacturers want a reduction in this case. Can Mr. Howard Smith explain why they are asking for it? I am glad to know that they did, but it seems strange to me, and we should be delighted to know the reason.


James Alexander Robb: It has been represented to us that this material goes into the manufacture of blotting paper, and these gentlemen manufacture that article. Raw cotton waste is bleached and baled and is a by-product of raw cotton; it goes into the manufacture of blotting paper, I am not sure but that the cotton waste men of Canada will oppose this application strenuously. I am simply making it clear that the request came on behalf of Mr. Howard Smith and others.


Henry Lumley Drayton: Have we any raw cotton waste of our own?


James Alexander Robb: Yes. I am not offering any objection.


Henry Lumley Drayton: Looking into the matter, can the minister indicate what the other people think about it?


James Alexander Robb: I listened to the representations that were made to me and I thought that my good, personal friend, Mr. Smith, was on better ground in this case than he has been in recent weeks.


Henry Lumley Drayton: This is where he was personally interested.


George Gibson Coote: In other words, the minister wants us to understand that the president of the manufacturers' association is in favour of a lower tariff when he has to buy but that when he has to sell he wants no reductions.


James Alexander Robb: I did not say that; the committee can draw its own conclusions.


Henry Lumley Drayton: I suppose this
material comes from the United States?


James Alexander Robb: Yes.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the
following be inserted after tariff item 590a:
590b. Racing shells when imported by a bona fide Amateur rowing club in Canada for use exclusively by such club: British preferential tariff, 5 per cent; Intermediate tariff, 25 per cent; General tariff, 25 per cent.
The present rates are 15 per cent, 25 per cent and 25 per cent. We are reducing the first rate to 5 per cent to enable importations to be made from England. The loss of revenue will be very small.


[Stage Direction]
Item agreed to.
Customs tariff-591. Farm wagons, logging wagons and complete parts thereof: British preferential tariff, 5 per cent; Intermediate tariff, 10 per cent; General tariff, 10 per cent.
James Alexander Robb: The present rates on farm
wagons are 10 per cent, 15 per cent and 17i per cent, and on logging wagons, 17i per cent, 25 per cent and 25 per cent. We propose reducing the rates on farm wagons and logging wagons to 5, 10 and 10 per cent. The estimated reduction in revenue on farm wagons is $5,471.63 and on logging wagons $4,500, a total of $9,971.63. The imports for consumption during the fiscal year ending March 31, 1923, of farm wagons amounted to $72,955 and freight wagons, $38,368. A part of the freight wagons would include logging wagons. These importations were from the United States.


Henry Lumley Drayton: Entirely?


James Alexander Robb: Yes.


Mr. SPEAKMAN:: What was the production in Canada during that time?


James Alexander Robb: I have not that information.


[Stage Direction]
Item agreed to.
2498	COMMONS
Ways and Means-Customs Tariff
Customs tariff-663. Fertilizers, compounded or manufactured, n.o.p : British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: The present rates are 5 per cent, 7i per cent and 10 per cent. We are putting these articles on the free list. The estimated reduction in revenue is 132,950. The imports for consumption during the fiscal year ended March 31, 1923, amounted to approximately $331,518.


Thomas Wakem Caldwell: Those are dutiable imports. Is there any record of the imports, comprising raw materials, which were not dutiable?


James Alexander Robb: No.


Henry Lumley Drayton: Where did those
imports come from?


James Alexander Robb: There came from the United States $297,881, from Belgium $29,000, from Hong Kong $31,000 and from the United Kingdom $4,025.


Henry Lumley Drayton: About 85 per cent came from the United States?


James Alexander Robb: Yes.


[Stage Direction]
Item agreed to.
Customs tariff-663b. Articles which enter into the cost of the manufacture of fertilizers, when imported for use exclusively in the manufacture of fertilizers: British preferential tariff, free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: There are varying rates at present and we are putting these commodities on the free list as a concession to the manufacturers of fertilizers. The estimated reduction in the revenue will be $10,000. There is no separate classification of imports.


Thomas Wakem Caldwell: The ingredients of fertilizers were all free before except acid phosphate on which there was a duty of 10 per cent.


James Alexander Robb: This concession will include packages, and certain, machinery which is necessary.


Henry Lumley Drayton: My hon. friend (Mr. Caldwell) is right; practically all the raw materials used in the manufacture of fertilizers, such as chemicals, were free before with the exception of acid phosphate. Is there any one manufacturing fertilizers in Canada now?


James Alexander Robb: Yes.


Henry Lumley Drayton: Where?
(Mr. Robb.]


Mr. CARROLL:: There is a plant in
Welland'.


Thomas Wakem Caldwell: I do not think that any part of the fertilizer was ever manufactured in this country; the manufacturers import the chemicals and simply stir them together here. There is some basic slag produced in Canada, but we do not as a rule call that fertilizer at all, although it has certain fertilizing qualities. Basic
9 p.m. slag is manufactured at Sydney and is a by-product of the manufacture of steel. As I said1 a moment ago, under the former tariff all the raw materials were free except acid phosphate, and all that the manufacturers do is to mix the ingredients in Canada, collect the duty on the raw materials and put it in their pockets. They are the real free traders.


Henry Lumley Drayton: Is there any fertilizer manufactured here to-day?


James Alexander Robb: Yes.


Henry Lumley Drayton: My hon. friend opposite, Mr. Carroll, says there is a plant at Welland; but that is out of business. There was also one at Montreal which has ceased operations. What is the minister's information in this regard?


James Alexander Robb: I know there was one at Sydney which went out of business a year ago but now that we are making this concession we hope the business will develop again.


Henry Lumley Drayton: But the only concession you are making is in regard to acid phosphate.


James Alexander Robb: And machinery.


Thomas Wakem Caldwell: The plants to which my hon. friend has referred may be closed much in the same way as the one is said to have been closed in New Brunswick, the Dominion Fertilizer Company. After the budget had been brought down a report went around that this plant was closing down, the business being transferred to the large plants operating in the United States. The manager of the New Brunswick concern, however, came out with an emphatic statement saying that not only had the business not been closed down but that they had no intention of closing it. Statements like these only injure the manufacturers. It can do the manufacturers no good whatever for false reports to be circulated that they are failing and going out of business, and, I do not think

Ways and Means-Drawbacks
that hon. gentlemen are doing their manufacturing friends a good turn by lending credence to these statements.


William F. Carroll: The same report was
made concerning the company in Sydney, who have been manufacturing fertilizer from slag. Slag itself, I may remark, is not used as fertilizer but it is employed in the manufacture of this commodity, and there was a report current about 'three or four weeks ago, shortly after the budget had come down, that the fertilizer plant in Sydney had been closed. As a matter of fact the company is not manufacturing a pound of fertilizer. Mr. Walker of the firm, who was here to see me regarding the matter, told me that the only thing they had been doing for the last nine months was getting clear of their surplus, which they were doing successfully. I agree with my hon. friend; stories of this kind do not help the country at all and still less do they help those in whose behalf they are circulated.


Henry Lumley Drayton: Basic slag
would not be affected by this.


William F. Carroll: No.


Henry Lumley Drayton: The freight rate would be the whole consideration in this case.


Burt Wendell Fansher: There are factories in
operation in Ontario, at Chatham, at Woodstock and at Toronto.


Mr. SINCLAIR (Oxford):: At IngersoU,
not at Woodstock.


Burt Wendell Fansher: I accept the correction.


[Stage Direction]
Item agreed to.
Customs tariff-682. Fish hooks, for deep-sea or lake fishing, not smaller in size than number 2.0; bank, cod, pollock and mackerel fish lines; and mackerel, herring, salmon seal, seine, mullet, net and trawl twine in hanks or coil, barked or not,-in variety of sizes and threads-including gilling thread in balls, and head ropes for fishing nets; marline, and net morsels of cotton, hemp or flax; and fishing nets or seines, and manila rope, not exceeding one and one-half inches in circumference, when used exclusively for the fisheries, not to include hooks, lines, nets or ropes commonly used for sportsmen's purposes:	British preferential tariff,
free; Intermediate tariff, free; General tariff, free.
James Alexander Robb: The only change there is
to take out the word "barked," thus widening the classification.


Henry Lumley Drayton: There will be
no loss of revenue?


James Alexander Robb: No.


[Stage Direction]
Item agreed to.

[Stage Direction]
4. Resolved, That schedule B to the Customs Tariff, 1907, as amended by chapter nineteen of the statutes of 1922 and chapter forty-two of the statutes of 1923, be further amended by striking thereout items 1002, 1026, 1027, 1031, 1036, the enumeration of goods, and the rate of drawback to the said items, and to provide that the following items, enumerations and rates of drawback of customs duties be inserted in said schedule B:-
Henry Lumley Drayton: Before we go
on to the items, will the minister tell us what this is about? For example, what is the effect of striking out item 1002?


James Alexander Robb: This was dealt with in a
previous item. Item 445b is substituted for 1002-that is, rolled iron and steel.


Henry Lumley Drayton: What is 1026?


James Alexander Robb: These are items that were
under 445a.


Henry Lumley Drayton: It says 99 per cent here now.


James Alexander Robb: No, it is 99 per cent that we
are striking out.


Henry Lumley Drayton: That is being
repealed under this resolution, and in place of that you are making it not free but are giving a drawback of 99 per cent; is that right?


James Alexander Robb: There is a new item; we will come to that later.


Henry Lumley Drayton: What about
1027?


James Alexander Robb: The old item is struck out
and the new item will take its place.


Henry Lumley Drayton: And we have
a new item for 1031?


James Alexander Robb: Item 1031 is to extend the
period in connection with the construction of a mill, under the legislation of last year. The drawback is extended from the first of July, 1924, to the first of January, 1925.


Henry Lumley Drayton: What is 1036
about?


James Alexander Robb: This is with respect to material entering into the manufacture of stumping machines. The present drawback is 40 per cent.
Customs tariff-1026. Materials, including all parts, imported prior to eleventh day of April, 1924, subject to drawback when entering into the cost of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591, before the first day of July, 1927-payable as drawback 99 per cent.


Henry Lumley Drayton: Will the minister explain the effect of the limitation, 'imported prior to eleventh day of April, 1924?"

Ways and, Means-Drawbacks


James Alexander Robb: This is to provide for goods
that were on hand on the eleventh of April which would enter into the costs. It is estimated that there will be a reduction of revenue of 175,000 in this connection.


Henry Lumley Drayton: The effect then, is that in connection with the tariff revision my hon. friend is making he is rebating to the manufacturers 99 per cent of all duties already paid on goods on hand.


James Alexander Robb: On goods entering into the
manufacture, as of that date.


Henry Lumley Drayton: That is the
date upon which the new tariff comes into effect. That was also tabled on the 10th of April, was it not?


James Alexander Robb: Yes, this was done to enable the industries at once to reduce the price to the Canadian farmer, putting them on a par with their foreign competitors.


Thomas Wakem Caldwell: It occurs to me that
this possibly goes further than the minister intended. It does not say "materials they have on hand", but all materials imported prior to the 11th of April, 1924. I am not sure that under that the manufacturers would not have a claim for rebate on all materials they had imported up to April 1924.


James Alexander Robb: I think it would be safe to
add "and on hand".


Thomas Wakem Caldwell: You could say "imported prior to the 11th day of April, 1924, and on hand at that date."


James Alexander Robb: It says "materials entering into the cost of goods imported before the first day of July, 1927." I think that covers it.


Thomas Wakem Caldwell: I think not.


James Alexander Robb: Then clause 5 says:
Resolved, that any enactment founded on the foregoing resolutions shall be deemed to have come into force on the eleventh day of April, one thousand nine hundred and twenty-four, and to have applied to all goods mentioned in the foregoing resolutions imported or taken out of warehouse for consumption on and after that day, and to have applied to goods previously imported for which no entry for consumption was made before that day.
I think it is all right as it stands.


Thomas Wakem Caldwell: I think I am right
still, but if the minister is satisfied I suppose I ought to be.


Henry Lumley Drayton: What is the
significance of the further limitation, "When entering into the cost of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591, before the first day of July 1927?"


James Alexander Robb: They might have goods on
hand that they could not wipe out within a month or six months or a year, and we are giving them this time to use up their raw material.


Thomas Wakem Caldwell: I am not clear on this
yet. If they are to be given a rebate on all materials they have on hand prior to the 11th day of April, 1924, why should there be any further time extension to let them work it off? It does not matter what they do with it if they get the rebate.


James Alexander Robb: We only give them the rebate after they have worked it up. This is to prevent them from selling it to somebody else.


[Stage Direction]
Item agreed to.
Customs tariff-1027. Materials, subject' to drawback when used by manufacturers of malleable iron castings or steel shafting for use exclusively in the manufacture of such articles for use in the manufacture of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591-payable as drawback, 80 per cent.
This is a concession to the manufacturers of malleable castings and steel shafting.
Henry Lumley Drayton: That takes the place of the 40 per cent?


James Alexander Robb: Yes.


[Stage Direction]
Item agreed to.
Customs tariff-1031. Artificial silk tops and waste or artificial fibre silk, artificial silk yarns or filaments enumerated in tariff items 583a and 583aa, subject to drawback when further manufactured before the first day of January, 1925-payable as drawback, 60 per cent.
Henry Lumley Drayton: What is the
idea of this? I did not notice it before, but I suppose this is because we have not yet got the artificial silk mill running.


James Alexander Robb: Yes.


Henry Lumley Drayton: If that is the
reason, why is there not a greater drawback than 60 per cent? That is simply penalizing everyone doing business in Canada to the extent of 40 per cent.


James Alexander Robb: I really could not answer
my hon. friend. I was not following this last session when it was put through, but this is simply extending the enactment of last year.
Sir	HENRY DRAYTON:	And it was
strenuously objected to last year, but we were told that the mill would soon be running and we need not bother about it. There is a direct handicap on Canadian progress to the extent of 40 per cent on every bit of artificial silk they use, and it is used-I forget in just what proportions-in connection with every

Ways and Means-Drawbacks
bit of botany yarn they turn out. It is simply putting a premium on the American product as against the Canadian product to the extent of 40 per cent. This is only for a year, so why not make it free for one year, or why not give them 99 per cent drawback for the year? The knitting concerns have hard enough times as it is without discriminating in this way against Canadian industry.


James Alexander Robb: I understand the Finance
Minister had a conference with all interested, and that they7 were satisfied with this arrangement last year.


Henry Lumley Drayton: I can assure my hon. friend they were not.


James Alexander Robb: I have put this in at the
request of representatives of the Canadian Manufacturers' Association, who told me of some difficulties they have had in getting the machinery forwarded to get this mill running.


Henry Lumley Drayton: It would be a
perfect outrage not to put that in. I want to put the case to my hon. friend. This material was on the free list, as I recollect it, and Mr. Russell will know if I am wrong -I have not my papers here-


James Alexander Robb: Part of it was on the free
list.


Henry Lumley Drayton: I mean this
artificial silk stuff. It was used for the purposes of manufacturing, and it was on the free list or there was a drawback of 99 per cent. Now last year we had a new infant industry started, and that infant industry was artificial silk, and in order to get this artificial silk industry going we had a whole list of protective duties introduced by the Minister of Finance, ranging as I recollect it from 15 to 37J per cent. It was pointed out in connection with that matter that this artificial silk formed the raw material in the manufacture of botany yarns and some other yarns, and so we were to have a drawback in connection with all these duties until that mill was running. It is a very small thing so why not make it 99 per cent?


James Alexander Robb: I would not like to lose that
revenue.


Henry Lumley Drayton: What revenue
would be lost? It is not a fraction of the revenue that my hon. friend is handing tonight to the American producers. The only difference is that a Canadian would be getting the benefit.


James Alexander Robb: What drawback do you suggest?


Henry Lumley Drayton: Ninety-nine per cent until this mill is started. It does not amount to anything.


James Alexander Robb: There may be some goods o.
hand. Why not compromise and make it 8k per cent?


Henry Lumley Drayton: Very well.


James Alexander Robb: I move that 80 per cent be
substituted for 60 per cent, payable as drawback.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-1036. Bar iron or steel, rolled, whether in coils or bars, one and one-eighth of an inch in diameter and over subject to drawback when used in the manufacture of goods enumerated in tariff item 410-payable as drawback, 99 per cent.
James Alexander Robb: This drawback is given on
account of the rate of duty being higher on the iron and steel. The rates on chain are free, 5 and 5 per cent.


Thomas Wakem Caldwell: Is this iron used in the making of chain?


James Alexander Robb: Yes.


Thomas Wakem Caldwell: Of one and one-eighth of an inch in diameter and over?


James Alexander Robb: Yes.


Thomas Wakem Caldwell: I think there is no
chain used in Canada of that diameter. What is it for,-stumping machines?


James Alexander Robb: I think it is used in the north.


Thomas Wakem Caldwell: My fear is that the minister is not meeting the need of this case I have lumbered and have done almost anything requiring to be done with chains and I never knew of such large chain.


James Alexander Robb: I made this provision at the request of a gentleman who was manufacturing this chain at Welland, Ontario.


Thomas Wakem Caldwell: Can you state what the chain is used for?


Mr. McBRIDE:: That size of iron is used in anchor chain, also in chains for hauling logs out of the water at the mill.


Thomas Wakem Caldwell: Possibly. But there would be nothing else as large as that in the shape of chains.


Thomas George McBride: Not that I know of.


James Alexander Robb: It is not a large item.


Thomas Wakem Caldwell: Is the minister satisfied that this meets the need he wishes to make provision for?

Ways and Means-Drawbacks


James Alexander Robb: Yes.


Thomas Wakem Caldwell: I am not objecting to the item but my opinion is that this is not going to apply to any chain unless it is anchor chain, I do not know that anchor chain is made in Canada.


James Alexander Robb: I am satisfied this is all the man who is manufacturing it asked for.


[Stage Direction]
Item agreed to.
Customs tariff-1036. Bar iron or steely rolled, whether in coils or bars, one and one-eighth of an inch in diameter and over; subject to drawback when used in the manufacture of goods enumerated in tariff item 410-payable as drawback, 99 per cent.
Item agreed to.
Customs tariff-1038. Materials, including all parts, subject to drawback when used in the manufacture of goods enumerated in tariff item 544a-payable as drawback, 99 per cent.
Item agreed to.
Customs tariff-1038. Materials, including all parts, subject to drawback when used in the manufacture of goods enumerated in tariff item 544a-payable as drawback, 99 per cent.
James Alexander Robb: The drawback is given on account of the free machinery for the manufacture of binder twine so as to enable the manufacturers in Canada, to produce the goods in this country without being at too great a disadvantage.


[Stage Direction]
Item agreed to.
Customs tariff-1039. Materials, including all parts not finished, subject to drawback when used in the manufacture of goods enumerated in tariff items 447 and 448b-payable as drawback, 30 per cent.
James Alexander Robb: This is a reclassification, there is no change except that tariff item 591 "farm wagons" has been taken out and the materials may now be entered under 445a.


[Stage Direction]
Item agreed to.
Customs tariff-1040. Bags, boxes and barrels, subject to drawback when imported by producers of salt, for use in covering salt produced in Canada-payable as drawback, 60 per cent.
James Alexander Robb: Salt packages are free when containing salt from the United Kingdom and there is a low rate when importations are made under the general tariff. The drawback is to equalize the duty paid on packages used by the Canadian producers of salt.


[Stage Direction]
Item agreed to.
Customs tariff-1041. Materials, subject to drawback when used in the manufacture of bags, boxes and barrels, when such bags, boxes and barrels are used in covering salt produced in Canada-payable as drawback, 60 per cent.
James Alexander Robb: The same reasons obtain here as in the case of the previous item.
fMr. Caldwell.]


Thomas Wakem Caldwell: Only this applies to the machinery that is used in the manufacture of these bags, boxes and barrels.


James Alexander Robb: And the materials.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the following be inserted after tariff item 1041:
Customs tariff-1042. Materials, including all parts, subject to drawback when entering into the cost of cyanide of potassium and cyanide of sodium-payable as drawback, 99 per cent.


Henry Lumley Drayton: Where did the request for this come from?


James Alexander Robb: The article is free and so we propose to give the material going into it a rebate of 99 per cent.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the following be inserted after tariff item 1042:
Customs tariff-1043. Materials, including all parts, subject to drawback, which entered into the cost of goods enumerated in tariff items 445, 446, 446b, 447b, 448 and 591, on hand or in process of manufacture, in possession of the manufacturer and unsold, on the tenth day of April, 1924. Provided that drawback payable under this item is in lieu of drawback payable under any other tariff item-payable as drawback, 99 per cent.


Thomas Wakem Caldwell: Explain.


James Alexander Robb: This is a further concession
that was made on the promise that the price of the implements in question would be reduced to the Canadian farmer.


Henry Lumley Drayton: Yes, but we
have already got one drawback. I appreciate that my hon. friend has been doing everything he can to get them to reduce these costs. I can tell my hon. friend one thing: He is going to get a reduction all right in the price of all these things if the present movement goes on in the States in connection with the steel values which will have to come here too. I noticed' to-day, and I have no doubt my hon. friend did, in a letter published from Boston very substantial decreases. Now what is really the difference between drawback item 1026 and drawback item 1043? What is the idea?


James Alexander Robb: These are the finished machines that are on hand. The other had to do with the raw material. We are taking into account the material that entered into the construction of machines that were already manufactured and ready to be shipped.


Henry Lumley Drayton: I would have
thought that the other one would have been just as good.

Ways and Means-Sales Tax


James Alexander Robb: This clears the matter up for administrative purposes.


Henry Lumley Drayton: The idea, as
the minister explains it, is to cover the case of the completed goods as yet unsold.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the following be inserted after tariff item 1043:
Customs tariff-1044. Fire brick, subject to drawback, when imported by manufacturers of iron or steel for use exclusively in the construction or repair of a blast furnace, open hearth furnace or rolling mill furnace-payable as drawback, 99 per cent.


James Alexander Robb: It is estimated the reduction
of revenue will be $75,000. It is a concession to the steel mills.


Henry Lumley Drayton: This will all
come from the States will it not?


James Alexander Robb: I think so.


Thomas Wakem Caldwell: None of this is made
in Canada?


James Alexander Robb: Practically none. Some brick is made on the Pacific coast.


Henry Lumley Drayton: There is a factory in Medicine Hat.


James Alexander Robb: That was not represented to
us. We were advised that there is one at Clayburn on the Pacific coast, but that the freight did not enable the product to be sold to eastern steel men.


[Stage Direction]
Amendment agreed to.
5. Resolved, That any enactment founded on the foregoing resolutions shall be deemed to have come into force on the eleventh day of April, one thousand nine hundred and twenty-four, and to have applied to all goods mentioned in the foregoing resolutions imported or taken out of warehouse for consumption on and after that day, and to have applied to goods previously imported for which no entry for consumption was made before that day.
Henry Lumley Drayton: I think that is the usual form.


[Stage Direction]
Resolution agreed to.
James Alexander Robb: Shall we go on with the sales tax? I thought we might run on till ten o'clock, but it is whatever my hon. friend says.


Henry Lumley Drayton: I notice we
have a great many vacant seats, but perhaps we could go on till ten o'clock. I might be able to facilitate my hon. friend by giving him information on the sales tax which he will have a chance to consider between now and Monday.


George Newcombe Gordon: I will call the resolution.


SALES TAX
[Stage Direction]
1. Resolved, That it is expedient to introduce a measure to amend the Special War Revenue Act, 1915, and amending acts, by providing that the rate of the consumption or sales tax imposed by section nineteen BBB of the said act shall be reduced from six per cent to five per cent.
Henry Lumley Drayton: Mr. Chairman, I want to draw the attention of the House to the answer given at page 1834 of Hansard in connection with the sales tax administration, and to point out that a large number of firms have not paid the tax. The total number of firms in arrears is stated to be 3,170. This is a tax which is supposed to be collected promptly, it is a tax which is a day-to-day charge on the business, it is something which in the ordinary nature of things ought not to be allowed to stand. In the same way as a concern pays its monthly rent and its monthly salaries, so it ought to pay its sales tax. And I believe the department want to have the tax so paid. I am not now attributing any improper motives to the department or slackness one way or the other. The act as we have it, I think, absolutely invites delays, invites difficulties, invites fraud and invites the troubles which the department now finds itself in.
I have gone over the act and noted its provisions so I could have in my own head just for a short time what the act really means.
I am quite sure that when the act was considered none of us took the trouble to understand it, not even its introducer, and I am going to make this statement now so that my hon. friend will have a chance to go over it with a view to seeing what can be done to clean up the absolute jungle that exists with the administration of the sales tax. In the first instance, the fundamental idea upon which the tax is based is that it shall be payable only upon completely finished manufactured goods-that was the new idea we had last year-that is to say, goods which are sold to the ultimate consumer and do not undergo any further process of manufacture. I do not think I am wrong in starting out upon that basis. To carry out that idea different manufacturers are treated in different ways, and likewise different wholesalers are also treated in different ways. This is an offence right at the threshold against the ordinary first principles of taxation.
A manufacturer whose finished products are sold to be further manufactured gets his raw materials without the payment of the tax, and he can sell his products without the payment of the tax to another manufacturer or to a licensed wholesaler, but if he sells to an unlicensed wholesaler or retailer he has

Ways and Means-Sales Tax
to pay the tax. There, you see, you immediately have room for trouble; you have two different sets of accounting, and you have an immediate necessity for checking. Both these classes of manufacturers have to pay the tax on materials they buy in Canada or import which are not used in wrought into or attached to articles manufactured by them for sale. There is another subdivision. Under this provision all sorts of questions arise, and there are all kinds of different interpretations placed upon it by the manufacturers. A manufacturer who does not manufacture goods to the value of $10,000 per annum is not required to pay any sales tax on the goods he manufactures, but he has to pay the tax on materials he imports, and a licensed manufacturer or licensed wholesaler selling to such manufacturer has to pay the tax on such sales. But there is a qualification to this. Subsection 3 of section 6 of the act provides:
If the minister determines-
I pause, and am willing to wager anything that not a single member has been able to follow the effect of what I have said down to this point.
If the minister determines that any manufacturer or producer, who does not manufacture or produce goods to the value of ten thousand dollars a year, uses a substantial portion of goods which are exempt from the tax in the manufacture of goods which are liable to the tax, as to which the minister's finding shall be conclusive, such manufacturer or producer shall take out a license as required by subsection 6 of this section and shall be subject to the same conditions as a licensed manufacturer or producer.
Hon. gentlemen will see how perfectly clear this sub-section is, how easy to understand'! The one thing we can understand there is that that sub-section can be interpreted just according to the length of the minister's foot.
A clause in the act, subsection 9 of section 6-the reason for which it is difficult to understand except on the ground of protection
is that which declares that as respects goods which may be imported free of customs duty, the Minister of Customs is vested with power to grant a refund or deduction of the sales tax, not to exceed 25 per cent. That is to say, he can make the tax 4J per cent instead of 6 per cent on similar goods manufactured in Canada. It is made a condition of the exercise of this power that satisfactory evidence must be produced that such Canadian goods are at a disadvantage with respect to similar imported goods. I just pause to point out that apparently the idea of ministerial discretion in granting or withholding protection is pretty well carried out in the present budget

in connection with raw materials entering into the manufacture of so many articles that are now greatly reduced.
Dealing now with the wholesale trade, the act divides wholesalers into two categories- licensed and unlicensed. A licensed wholesaler is one 50 per cent or more of whose total sale of goods is to manufacturers, to be used, wrought into or attached to articles manufactured for sale, which, when sold, are subject to the sales tax. Unless a licensed wholesaler can come within that category, he is not entitled to a license even although the annual volume of his business may be as great, if not greater, than that of a wholesaler entitled to a license.
A licensed wholesaler can import or buy from a Canadian manufacturer, without the payment of the tax and sell without the payment of the tax to manufacturers, goods to be used in, wrought into or attached to articles to be manufactured for sale and subject to the tax when sold. Such licensed wholesaler has to pay the tax when he sells goods to persons, other than licensed manufacturers or licensed wholesalers. Plenty of room again for plenty of bookkeeping and plenty of mistakes.
An unlicensed wholesaler has to pay the tax on everything he imports, and licensed manufacturers or wholesalers selling to him have to pay the tax on their sales, which tax they will no doubt pass on to him.
If such unlicensed wholesaler should sell goods to a manufacturer to be used in, wrought into or attached to articles to be manufactured for sale and subject to the tax when sold, he is entitled to a refund of the tax paid upon making claim to the department, accompanied by proof of the payment of the tax and the sale and delivery to the manufacturer.
It is no exaggeration to state that at least 75 per cent of the wholesalers of the country would be treated as unlicensed wholesalers, and that consequently all the transactions of that large percentage of wholesale traders with manufacturers in respect of goods to be further manufactured, will be subject to refund in the Customs department involving tremendous private and official expense. It is no wonder that the return from the department is what it is.
Then again, subsection B of section 12a of the act provides that:
When goods are sold by a wholesaler or jobber not licensed under this act to a licensed manufacturer or producer, the purchaser shall be furnished with a written invoice of the goods sold, which invoice shall state separately the amount of the consumption o: sales tax.

Ways avd Means-Sales Tax
Compliance with this section clearly means a disclosure of the profit of the unlicensed wholesaler, because the tax which he paid and has to show in his invoice to the buyer from him was based on his-the unlicensed wholsaler's-purchase	price. Could anything be more absurd than to require a seller to disclose to his buyer the profit he is making on the transaction? The other licensed wholesaler has not to do that; but the unlicensed wholesaler, who has had to pay the tax and who is entitled to his refund, is put to the statutory disadvantage that he has to show plainly what his costs were.
In view of the provisions in the act for deduction, the act would be better entitled "The Sales Tax and Deduction Act." These deductions are as follows:
A manufacturer or a licensed wholesaler is entitled to a refund by way of deduction from sales tax returns, and the amount of the old sales tax paid directly to the government or to the person from whom he bought, on goods which he had on hand unsold on January 1, 1924, if such goods have been, are being or are to be .used in, wrought into or attached to articles to be manufactured or produced for sale and which are articles subject to the consumption or sales tax when sold.
To get this deduction each manufacturer and licensed wholesaler has to file an inventory of such goods and make claim therefor. The deduction is allowed to the manufacturer as he uses the goods-without reference to the sale thereof-and to the wholesaler when he sells the goods.
Under the language of the statute, a manufacturer could claim a deduction of the total amount of such tax without waiting to use up the goods upon which the tax was paid. Some manufacturers whose finished products are sold to enter into other manufactures, may not have any tax to pay, and, consequently, they are entitled to get back the tax paid on materials on hand on January 1, 1924, by way of refund after compiling inventories and making claims as above set forth.
Imagine, if you can, the tremendous amount of work to business firms with consequent expenses involved in compiling inventories and showing the tax paid thereon, in making claims for deduction and refund, and also the work to the officials of the Department of Customs in checking these inventories and claims. The plain, inescapable truth is that it will be almost impossible for the Customs department to make the proper necessary check of inventories. If there is any doubt about that, I think my hon. friend ought to look into the matter and see just how this
thing has worked out. A proper check would take years to make, and in the meantime business would be disorganized. It may be taken for granted that if any errors are made in preparing these inventories and claims, they will not be altogether in favour of the government. The door seems to be wide open to fraud on the revenue.
Unlicensed wholesalers get back by way of deduction or refund from sales tax returns, the tax paid upon materials they had on hand on January 1, and which they sell afterwards to manufacturers to be used in making articles subject to the tax. They must have had the materials on hand and a subsequent sale has to take place before this can be ascertained.
If a manufacturer making goods subject to the tax when sold should pay the tax on imported materials, he is entitled to get it back by way of deduction.
A refund of the tax may be granted on imported goods in respect to which customs duties have been refunded on exportation. This is a quotation-I will show it to the minister :
A deduction from the consumption or sales tax may be granted in respect to goods sold at a price fixed by a bona fide contract of sale made before the 12th day of May, 1923, and still in force at the time of delivery of the goods.
Section 13 of the act gives most extraordinary powers to the minister. It reads as follows:
Whenever goods are manufactured or produced in Canada under such circumstances or conditions as render it difficult to determine the value thereof for the consumption or sales tax because:
(a)	A lease of such goods or the right of using same but not the right' of property therein is sold or given; or
(b)	such goods having a royalty imposed thereon, the royalty is uncertain, or is not from other causes a reliable means of estimating the value of the goods; or,
(c)	such goods are manufactured by contract for labour only and not including the value of the goods that enter into the same, or under any other unusual or peculiar manner of conditions; or,
(d)	such goods are for use by the manufacturer or producer and not for sale.
Under this section it has been provided by regulation that:
In respect of goods subject to consumption or sales tax sold by retail by the manufacturer or producer thereof in Canada, the value of the goods for purposes of the tax will be determined by the Minister of Customs and Excise in each class of cases.
In other words, apart from the question of statutory rate, the minister has the absolute right to say what taxes shall be paid. It seems to me that any statute is absolutely indefensible which does not allow our business people to know what they have to pay when they operate; and no man in the world can

Ways and Means-Sales Tax
tell what he has to pay under this system. The minister can do what he pleases; no standard whatever is set up by which he is to be governed. Some manufacturers import goods which they might use in manufacturing other articles or may sell in the condition as imported. In such cases the manufacturers are entitled to import free of tax all such goods and they have to pay the tax when they sell such goods in the condition as imported based on the duty paid value of the goods when imported; which means going back to the customs entry and invoice. Here again there will be difficulty in checking returns. Every licensed manufacturer or licensed wholesaler buying goods in Canada to be used in making articles for sale subject to the tax, or which are for re-sale, has to quote his license number and give a certificate that the articles are to be used in making articles for sale, or are for re-sale; and he has to make similar license quotations and certificate on entries of imported goods. This of course means additional work to business firms and additional expense to the government in checking the returns to ensure that license numbers are quoted and certifications furnished in respect of non-taxable sales. Licensees are enjoined against quoting their license number and giving certificates as respects goods purchased by them consisting of plant, equipment or other goods for their own use and not for sale. A man has to be watching all the time to make sure that he is not infringing the regulations; he has to be on the qui vive to see that he is not breaking some provision of the act which renders him liable to penalty.	_
To-day there is absolutely no principle applied in connection with the administration of the act. It was attemped to be confined to the primary articles entirely, but that is something that has been lost sight of. There is no question of principle. For example, an application was made to the government-I am speaking from memory on the strength of a return I received-for exemptions in the cases of both newsprint and coffee. The sales tax on coffee was 6 per cent. What principle would determine the result that the sales tax on newsprint should be reduced 2^ per cent, which I think is the figure, while there should be no reduction of the sales tax on coffee? I am speaking of what is being done, and I hope that my hon. friend will take a note of the representations I am making in this regard. In connection with the collection of current taxes we have a muddled situation. I am not going to say for a single moment that there is anything dishonest about the matter. But just consider the answer which the minister gives to a question that is asked him:

In the balance of the cases the department is corresponding with the firms and individuals concerned with a view to making satisfactory arrangements for payment of arrears before legal action is taken.
These latter cases require nursing as drastic action would probably result in financial failures.
That is in connection with a tax that is coming due from day to day and which certainly ought to be settled monthly. We have such a mass and jungle of meaningless words in the act that it is impossible for one to carry it out intelligently. I want to give the Minister of Customs full credit both for industry and for intelligence, but he should not have to bring down a return like that. Surely to goodness the government having tried the freak legislation of last year ought to do something to put matters upon a more plain, if not a more logical, basis. At all events, let us pass legislation which will enable the people to know where they stand.


James Alexander Robb: It is now approaching ten
o'clock and after we have adopted this resolution we shall adjourn. Before we do so however I want to acknowledge the statement which my hon. friend has placed on Hansard and to which I shall direct the attention of my colleague who is administering the act in question. I am prepared to agree with my hon. friend that there is difficulty in administering an act of this character. The fact is that no tax is popular, and if we could conceive of a tax that would meet with popular approval a large part of our troubles would disappear. I am sure that the hon. member, who was at one time head of the Finance department and responsible for collecting the revenue, must have had advice, as others in the department have had from time to time, as to the best methods of imposing taxation. I am not sure whether he was advised, as I have been, 10 p.m. that a popular and simple tax would be a turnover tax. There are those who say that we should have a tax on daily bank balances, while others advocate a land tax and others again a tax on bachelors. Well, I may say that some amendments as we come to them will in part at least remedy the difficulties that my hon. friend has pointed out. Regarding that part of the answer brought down to which my hon. friend has referred, concerning the "nursing" of certain businesses, I might observe that I am nursing along to-day, and am compelled as Acting Minister of Finance to nurse along, some institutions that are in arrears in taxes for which they were liable in the years when my hon. friend was Minister of Finance; and any unduly harsh treatment would put them out of business throwing many men out of employment. Taking all

Lausanne Treaty-Papers
tilings into consideration I think the taxes have been fairly well paid, and the people of Canada have responded fairly well to the demand for increased taxation to meet our war and other obligations. I shall direct the attention of my colleague to the observations of my hon. friend. It is the desire of the government as far as possible to simplify the collection of the sales tax, and we hope that the measures now submitted will have that effect. I trust the committee will pass the resolution.


Henry Lumley Drayton: Does the minister think that he should ask us to pass it to-night?


James Alexander Robb: The present resolution only
involves the reducing of the tax on the various items from 6 to 5 per cent.


Henry Lumley Drayton: But the whole
principle is involved.


James Alexander Robb: I do not press it.


Henry Lumley Drayton: On the question of nursing accounts, my hon. friend may have had a little sapling to work with but he has developed it into a whole forest. He says he has some legacies from me. I remember the time-I will not say my hon. friend did it; he had too much sense and honesty to do it

when any number of his associates were calling down vengeance from high heaven on my head because I did not put the Riordon Company out of business-just one concern.


James Alexander Robb: Well, I never did.


Henry Lumley Drayton: I give my hon. friend credit for that; I say he had too much honesty and common sense to do it. But it was done and done all over, done at a time when their product was selling at a fraction of what it is bringing to-day. My hon. friends have done nothing with that account, have not collected five cents of it. Yes, it was in arrears with me something like three months after it came to my knowledge; my friends have been in office two years and nine months or thereabouts, but nothing is done. And it goes on growing. There is some difficulty in arriving at excess business profits where you have to follow everything and go through a whole arbitration before you can find it out, but there ought to be no difficulty in collecting current taxes; there ought to be no nursing of monthly accounts. That is the business my hon. friend's legislation would put him into.
Resolutions reported, read the second time and concurred in. Mr. Robb thereupon moved for leave to introduce Bill No. .127, to amend the Customs Tariff Act, 1907.
Motion agreed to and bill read the first time.
On motion of Mr. Robb the House adjourned at 10.07 p.m.
Monday, May 26, 1924