BUSINESS OF THE HOUSE

Right Hon. ARTHUR MEIGHEN (Prime Minister) moved:: That on and alter Monday the 23rd instant, until the end o1 the present session, the House meet at Two o'clock in the afternoon of each day.


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Motion agreed to.

Arthur Meighen: That when this House adjourns on Monday, the 23rd instant, it do stand adjourned until Wednesday, the 25th instant.


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Motion agreed to.

Arthur Meighen: I beg to lay on the table of the House the subsequent correspondence between the Government and the Grand Trunk Railway Company relating to the arbitration and to the Bill passed by this House to provide for the revival of the arbitration proceedings. The correspondence includes a copy of the agreement as despatched overseas for execution, and as well copies of subsequent cables suggesting amendments to the agreement, and consequently it discloses the agreement as actually signed.



PENITENTIARIES ACT AMENDMENT

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Right Hon. C. J. DOHERTY (Minister of Justice) moved for leave to introduce Bill No. 201, to amend the Penitentiaries Act. He said:
The principal clauses of the Bill and the principal purpose sought to be attained by it are to make provision to enable the carrying on, on a larger scale, of industrial work in penitentiaries. There are other provisions of a less important nature, and I might, perhaps, just mention them before I take up the most important ones. There are quite a number of provisions repealing sections of the existing Act because, in view of legislation in regard to classification under the Civil Service Act, they serve practically no purpose. There is a provision extending the definition of a penitentiary so as to make it include a hospital in which a convict may be detained. There is provision made for enabling the minister to constitute an advisory board composed of officials to advise with him concerning the administration of penitentiaries. There is a provision making more clear the definition of the duties of a warden. There is a provision dealing with fines that may be imposed by the warden, and with his power of suspension. There is a disposition with regard to uniforms to be supplied to officers and purchases which it is permissible fo rthem to make of articles manufactured in the penitentiaries. Then there are other provisions which are dealt with because,
IMr. Meighen-J
as a matter of fact, by the effect of subsequent legislation and the practice of carrying on penitentiaries, they have become practically obsolete. They were provisions which looked to treating each penitentiary as a separate orgarrization by itself under the executive control of the warden, giving him control of purchases and so forth. The effect of subsequent legislation has been that these sections have fallen into disuse, and they are simply repealed.
There is a provision with regard to visitors, making more clear the present provision. I do not think it substantially modifies the present provision. There is a provision to enact that when a man is sentenced to a penitentiary, he shall be sentenced to such penitentiary as the minister shall from time to time designate. Under the present section, the court is required to sentence him to the penitentiary of the province, but there is power in the minister to transfer him to any other penitentiary. As we have recently done away with one of the penitentiaries, a provision assuming that there is a penitentiary in each province becomes inapplicable, and, in fact, it was not strictly applicable even in the past. There is a provision requiring that the judge or judicial officer who pronounces sentence shall prepare a schedule giving information and details elicited from the convict himself as to his past and so forth. This, it is considered, will be useful information to those taking charge of the convict. There is a provision enabling the minister, who now has to sign every order for transfer from one penitentiary to another, to authorize an officer to do that instead. There are provisions, which, I think, may be described as making more clear and more effective the present provisions with regard to the manner of dealing with insane convicts. I do not think there is any substantial modification. Likewise, there is a provision as to dealing with convicts suffering from infectious or contagious diseases, which provision also makes more clear existing legislation. There is a provision dealing with the detention of female convicts, making it possible, which will seem to be very desirable, if it be found practicable, to provide an absolutely separate institution for them. There are provisions making more clear the existing disposition as regards the remission of part time of sentences for good conduct on the part of the convicts. There is also a provision requiring that the convicts shall be furnished with a copy of

the regulations so that they may know what laws they are living under.
Then we come to the provisions to which I have referred. In substance, it is enacted that the different departments of Government shall, where that is practically possible, procure from the penitentiaries such things as they require and which can be produced in the penitentiary. There are dispositions following on that, providing for the details as to how the penitentiaries shall be compensated for the goods so furnished. It is not intended that there shall be an actual payment of money from one department to the other, but there are ^different provisions establishing a method of determining what sum of money as a whole should be allotted to the penitentiaries administration as compensation for the work so done. Then there are provisions for the allotment as between the convicts out of this money of what may be found available in the way of remuneration for their labour, after taking into consideration the cost of maintenance of the penitentiaries, and so forth.
There is a provision making more severe the penalties to which officers are subjected for the offence of trafficking with convicts, and regulating the question of the burden of proof when an officer is charged with being in possession of or dealing with articles with which he is forbidden to deal under the law or the regulations of the penitentiary.
There is a section providing for and adding to what is required presently to be given to a convict upon his discharge from the penitentiary, principally in the way of clothing, and to some extent in the way of an allowance of money. That covers the dispositions of the Bill.
Mr. JACQUES BUREAU (Three Rivers and St. Maurice) :: With the consent of
the House I would like to ask a question, and make a suggestion to the right hon. Minister of Justice (Mr. Doherty). The question I desire to ask is whether the Bill now presented to the House is based on the reports made by the Commissioners who were appointed to investigate the penitentiaries. My hon. friend nods assent. I have read over that report, and I notice that it suggests certain amendments which are quite radical changes in the existing law. I would suggest to my right hon. friend the Prime Minister that unless we are going to fix a date in June to discuss this Bill, together with the Bill amending the Criminal Code, we might better discuss
it next session. The Bill might be printed, so that hon. members could familiarize themselves with it. It is a long and important Bill, and as we are trying to get away by next Saturday I do not think it is fair that we should be called upon to make a study of this important matter at this time.


Mr. DOHERTY:: When the Bill is
printed and distributed I think it will be found that it does not involve anything so drastic as the hon. gentleman seems to apprehend.


Jacques Bureau: I did not say drastic;
I said radical. There is quite a difference.


Charles Joseph Doherty: I might perhaps point out that the intention is to make it possible to carry out the recommendations that are made, but I do not think that there is anything that makes it imperative that they should be carried out. However, the Bill will be printed, and I shall be glad to confer with the hon. member and other hon. gentlemen. Certainly I do not want to press any legislation through without proper opportunity for its consideration. On the other hand, there are some improvements which are perhaps of a pressing nature, and possibly they might be dealt with.


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Motion agreed to, and Bill read the first time.

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Bill No. 187, to repeal The Conservation Act and Amendments.-The Prime Minister.
Bill No. 189, respecting The Great West Bank of Canada.-Mr. Cowan.

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Bill No. 190, for the relief of Frederick Orford.-Mr. Mowat.
Bill No. 191, for the relief of John Deluce.-Mr. Fripp.
Bill No. 192, for the relief of John Samuel Bain.-Mr. Best.
Bill No, 193, for the relief of Addie Irene Gilbert.-Mr. Mowat.
Bill No. 194, for the relief of Ethel Edna Denning.-Mr. Fripp.
Bill No. 195, for the relief of Audrey Cleeve Bennett Gibbons.-Mr. Fripp.
Bill No. 196, for the relief of Laura Newson.-Mr. Sheard.
Bill No. 197, for the relief of Tom Eccles.-Mr. Sheard.
Bill No. 198, for the relief of John Chalk:-Mr. Sheard.
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PRIVILEGE-Mr. TURGEON On the Orders of the Day:
Mr. ONESIPHORE TURGEON (Gloucester) :: I rise to a question of privilege. In the correspondence that the right hon. the Prime Minister read yesterday from a Conservative friend in St. John with reference to the Hon. Mr. Veniot, Minister of Public Works in the New Brunswick Cabinet, a reference is made to me which I cannot allow to pass unnoticed. In his letter he says:
Of course Mr. Veniot would have a portfolio In Cabinet. To make an opening for him Mr. Turgeon would have to be provided for and Mr. Veniot for the time being, at least, represent Gloucester.
Let me say that Mr. Turgeon is well provided for by the electors of Gloucester county, and wants nobody else to provide for him. The writer in question, I am sure, was not acquainted with the mentality of the people of Gloucester when he wrote that letter. Possibly he has been better informed since.



GRAND TRUNK SHAREHOLDERS

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On the Orders of the Day:
Mr. JOSEPH ARCHAMBAULT (Cham-bly and Vercheres):: I beg to draw the attention of the Prime Minister (Mr. Meighen) to a statement made in the House yesterday in reference to the list of Grand Trunk shareholders. My right hon. friend yesterday stated, as reported at page 3804 of Hansard:	'
This list has been required in connection with the Grand Trunk Arbitration proceedings, and had to be sent twice to Montreal. It is in the department at present and is available.
I would ask my right hon. friend at what date this list was received, for what purpose it was required in Montreal in connection with the Grand Trunk Arbitration proceedings, and also what was the undoubtedly enormous cost which the Government had to pay to procure that list.


Arthur Meighen: What I stated to the House yesterday was based on a memo, supplied me by the Department of Railways and Canals. I find I have not that memo, in my desk at the moment, but I do not think it gave the date of arrival of the packing box containing the names, nor did it say what use was made of the material by the Arbitration Tribunal; it simply said it had . been necessary. It did not say, either, what the cost was, but I do not think it is hard to divine that the cost would be

very high indeed. Whether paid by the Government or by the Grand Trunk, it will ultimately be paid by the country. I will endeavour to find out what the uses of the list were, when it was received, and, if I can, what the cost was, but I do not know whether that will, be in the possession of the department or not.


Joseph Archambault: I ask the date for the reason that my right hon. friend, when he answered me two days ago, said he was not aware that the list had arrived, and yesterday he informed the House that it had gone to Montreal in connection with the Grand Trunk arbitration proceedings which took place a month ago.


Arthur Meighen: I did not know it had
arrived until I got this memorandum from the Department of Railways and Canals.



SUPPLEMENTARY EXTRADITION


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On the Orders of the Day:
Hon. W. S. FIELDING (Shelburne and Queen's) :: May I call the attention of the Minister of Justice (Mr. Doherty), to Order No. 38 with respect to the Supplementary Extradition Convention Treaty with the United States of America? Is there any correspondence on this subject and will the right hon. minister be good enough to bring it down before the measure is proceeded with?


Charles Joseph Doherty: I believe some correspondence has been exchanged with the persons who are interested in the Treaty, and I shall be glad to bring it down.


William Stevens Fielding: That is, correspondence in connection with any action taken by the Government in reference to the matter.


Charles Joseph Doherty: I will look into the
matter. Perhaps I might say now that in view of the report of the proceedings of the Senate laid on the table to-day, it will be necessary for us to drop the proposed Bill for the present. It appeared by the report, when we received it, that the message from the Embassy in Washington was erroneous in that it informed us that the Senate had ratified the Treaty, whereas we find, from the documents that have come to hand, that their ratification was subject to an amendment which very substantially modifies the convention. Of course, that amendment would have to be agreed to by the other contracting party before there could be a treaty which would

be susceptible of ratification, and I therefore propose, when the Order is called, to ask leave to withdraw the Bill.


William Stevens Fielding: If the Bill is not to be proceeded with, I will not, of course, trouble my right hon. friend for the present to submit any correspondence. The matter will come up at a later stage, and when it does it will be time enough to ask for the correspondence.



GRAND TRUNK DIRECTORS

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On the Orders of the Day:
Mr. FRANK S. CAHILL (Pontiac) : I notice in this morning's Journal a report to the effect that Sir Joseph Flavelle, Edward G. Kelley, A. J. Mitchell, E. L. Newcombe and J. N. Dupuis have been appoirited by the Government as Grand Trunk directors. If that report is correct, for what period have these directors been appointed?
Arthur Meighen: The gentlemen named by my
hon. friend-I do not catch all the names, but I think the list is correct-have not been appointed by the Government, because we have not the power of appointment. To make up the required number, they have been nominated by the Government for appointment by the directors themselves upon the resignation of individual directors, which resignations are called for by the Order in Council making the nominations. The Order in Council further provides, in accordance with the Bill and the agreement, that when one retires after the other, until five have retired, and these five nominated by us have been appointed, the remaining directors shall resign. Whether the appointemnts have yet taken place, I am not certain, but the Order was cabled over the day it was passed, and I would presume that if the appointments have not taken place yet. they will very shortly. Under the statute, it was necessary that the directors be nominated by the Government, and these gentlemen are the directors so nominated. They are merely in charge until the calling into effect of the Canadian National Railway Act, upon which it is intended that the Grand Trunk shall be placed under that directorate. That is expected to take place shortly. The new directorate will take charge, and unless there is some reason to the contrary, almost immediately afterwards it is the intention to call the Act into effect.



SUPPLEMENTARY ESTIMATES TO BE BROUGHT DOWN

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On the Orders of the Day:
Hon. W. L. MACKENZIE KING (leader of the Opposition) :: In view of the fact
that one of the ministers has stated that the Government expects an early prorogation, I should be glad to know when we may expect the Supplementary Estimates to be brought down?


Sir HENRY DRAYTON (Minister of Finance):: They do not think the House will sit on Tuesday, but I hope to be able to bring them down on Wednesday.



SUPPLEMENTARY EXTRADITION CONVENTION ACT

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On the Order for the second reading of Bill No. 158, respecting a Supplementary Extradition Convention with the United States of America.
Charles Joseph Doherty: I beg to move, for the reasons which I have already stated in answer to a question by my hon. friend for Queen's and Sunbury-


William Stevens Fielding: Shelburne and Queen's; the member for Sunbury will be here shortly.


Charles Joseph Doherty: Shelburne and Queen's, I should say. For reasons I have already given, I move that the Order be discharged


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Motion agreed to.

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SP KOI Aii WAR REVENUE ACT AMENDMENT
The House in Committee of Ways and Means, Mr. Boivin in the Chair.
['The Act of last year\nwas intended to be a relief to the Post Office\nDepartment from a great many encumbrances on its revenue. My thought was that it was intended that these health reports should not be exempt from paying postage. The matter affected by this Bill was also last year included in the list of that not exempted, as was, indeed, everything coming from Provincial Governments. A tremendous amount of revenue was lost and all manner of stuff was sent out that was wasted simply because it\n6 p.m. went free. The whole subject was reviewed, and the matter was put, as we thought, on a business basis. The hon. gentleman may possibly be light\n\nas to the health reports, but I fancy that it is a case of services rendered the province by the Federal Government, rather than service rendered by us to the province, and they should hardly object to paying postage on them. But here we have a case where service is rendered by the provinces to us, and I understand that is why the Minister of Trade and Commerce felt he could not continue the rule of having them pay postage. Anyway, if my hon. friend were right the change would have to be made by amendment to the Health Act.']
The CHAIRMAN:: When the committee rose last evening we were considering the last of the resolutions which will be found as an appendix to the Votes and Proceedings of Monday, May 9. The first, second and third of these resolutions, to amend the Special War Revenue Act, had been adopted, and the Committee was considering resolution No. 19 bbb, which had been amended by inserting the words " including rolled oats," in the ninth line on the second page, and striking out the words " when in packages weighing not less than 48 pounds each". Shall this resolution as amended, carry?


Henry Lumley Drayton: I intimated last night that there were some amendments



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proposed to be made in the resolution and we dealt last night with one of them in connection with oatmeal in packages. The formal resolution which I desire to have adopted on that point is that the words "and oatmeal when in packages weighing not less than forty-eight pounds each" on lines 9 and 10 on page 8 of the resolutions be struck out and the following substituted therefor "oatmeal, rolled oats and corn-meal." Then there is a further change in order to remove a doubt-a doubt which arose in the discussion yesterday-having regard to the duties on spirits, as to whether or not the provinces who bought for the purposes of resale would or would not be liable to taxation. I desire to move a further resolution so as to remove all doubt in that connection. I move that the following words be added on the fifth line of page 8 of the resolution, after the word "consumers":
-including- sales to His Majesty, whether in the right of His Majesty's Government of Canada or His Majesty's Government of any province of Canada, for the purposes of resale.
I also move that, in the sixth line of the same page, the following words be added after the word "consumers":
including importations -by His Majesty, whether in the right of His Majesty's Government of Canada or His Majesty's Government of any province, for the purposes of resale.
William Stevens Fielding: Will the minister
kindly read the clause in its amended form?


Henry Lumley Drayton: The clause
in its amended form will read as follows:
That in addition to the present duties of customs and excise there shall be imposed, levied and collected an excise tax of one and one-half per cent on sales and deliveries toy Canadian manufacturers or producers, and wholesalers or jobbers, and a tax of two and one-half per cent on the duty paid value of the goods imported, but in respect of sales by manufacturers to retailers or consumers-
Now the addition comes in there-
- including sales to His Majesty, whether in the right of His -Majesty's Government of Canada or His Majesty's Government of any province of Canada, for the purposes of resale, the excise tax payable shall be three per cent and on goods imported by retailers or consumers, including importations by His Majesty whether in the r ght of His Majesty's Government of Canada or His Majesty's Government of any provinc, of Canada, for the purposes of resale, the excise tax payable on the duty paid value shall be four per cent.
The whole effect is to add to the operations of the Crown the tax which is put upon the general public. It follows the

principle established by . the Customs Amendment Act of 1917 and the language of that Act.


Georges Henri Boivin: Shall the amendment carry?


Mr. ROBB:: Before the amendment carries I would like to ask if the minister has any statement to make in regard to what I pointed out to him last night.


Henry Lumley Drayton: If my hon.
friend will allow me I will have great pleasure in dealing with that matter when we come to it, I have not overlooked anything.


William Stevens Fielding: The effect of the minister's proposition is to levy a tax upon the purchases of either the Dominion or the provinces. In the case of a tax by the Dominion it is simply a case of the money going from one pocket to the other. In the case of the provinces, however, it is either a tax upon the seller or the buyer. I do not think there has ever been any question-in practice at any rate whether there is in law-of the right of the Dominion Government to impose taxation on articles imported by the provinces. I know of cases that came up in my own province where the province has had to pay the tax. I believe there is some question now as to its legality, but in practice there has never been any hesitation on the part of the Dominion to collect taxes on goods imported by the provinces.
_ Mr. VIEN: Is there not a case in British Columbia at the present time in which this question is in dispute?


Henry Lumley Drayton: Not that I
know of. From what I see in the papers, however, I believe the Attorney General of British Columbia has challenged our right to collect the increased spirit taxes from that province and the Government received a wire from him asking whether it was our intention to collect. We have so advised him.


[Stage Direction]
Amendment agreed to.
Henry Lumley Drayton: : If hon. gentlemen will look at the next paragraph, which deals with lumber, they will see that it is only the manufacturers' sale of lumber which carries a tax, and that there is no tax in respect of sale by the wholesaler, An amendment is proposed in that connection to make it perfectly clear that not only shall there be only one tax in the case

of domestic lumber, but that there shall also be only one tax in connection with imported lumber, which was my intention. I am therefore making a change in the basic rate. Hon. gentlemen will see that the resolution reads:
Provided that in respect ot lumber an excise tax of three per cent shall be imposed, levied-
And so on. The motion is:
That the word "two" be substituted for the word "three" in the first line of the sub-provision.


William Stevens Fielding: Reducing the rate.


Henry Lumley Drayton: Reducing the
rate to two per cent. And then the further addition:-


Mr. GAUVREAU:: Before the minister
proceeds, may I bring to his attention a special case?


Henry Lumley Drayton: I think perhaps what I am about to read will meet the hon. gentleman's case. I will be very pleased to discuss it after he has heard this motion. Then I propose this further addition :
That after the word "manufacturer" in the second line of that suh-provision, the following words be added : "and of three per cent on importation."
The sub-provision will then be in this form:
Provided that in respect of lumber an excise tax of two per cent shall be imposed, levied and collected on sales and deliveries by the Canadian manufacturer and of three per cent on importations, and that no further excise tax shall he payable on resale.


Mr. COPP:: What change is there from
last year?


Henry Lumley Drayton: There were
two taxes collected on lumber last year; it is now reduced to one tax.


Charles Arthur Gauvreau: I should like to bring to the attention of the minister a special case. It is the spirit of the law that the tax applies where a farmer brings his logs to the local saw-mill to be sawn into boards or any other form for his own use? I was told first that the tax could not be applied because there was no manufacture, and I gave that information to the newspapers so that all the farmers in my riding might be advised. Four months later I received a letter that the department had changed their mind, and then I had to advise my constituents that they would have to pay the tax.


Henry Lumley Drayton: The basis is
somewhat changed this year. We are tax-
2371	i	.i I*
ing entirely on sales. In the case my hon. friend refers to there was no sale, and therefore there would be no tax under the new law.


Charles Arthur Gauvreau: Do I understand the minister to say that whenever a farmer brings his logs to the mill to be sawn into boards, planks or any other form for his own use there is no tax?


Henry Lumley Drayton: That is custom sawing, and there is no sale involved.


Onésiphore Turgeon: My hon. friend will remember the objection I made to the excise tax on lumber in the course of my speech on the Budget. I presented to the House at the time the difficulty of selling lumber on account of its high price, due in part to the increased freight rates, and that consequently this discouraged building and raised rents in the cities. My opinion has been strengthened by advices I have received from different parts of the country. Therefore I move, Mr. Chairman, that all of this clause referring to the excise duty on lumber be struck out.


Henry Lumley Drayton: This is an exception in favour of lumber, and the effect of my hon. friend's motion would be to raise the tax to three per cent instead of two per cent, which I am sure is not what he desires. We are not increasing the tax in this instance over what it was last year.


Onésiphore Turgeon: It is increased by one and a-half per cent.


Henry Lumley Drayton: Excuse me, we are cutting it down to two per cent.
Mr. P'EDLOW: What are the special reasons for exempting the products of the forest under this clause?


Henry Lumley Drayton: That was
done for the same reason that we have made other general exemptions. The primary activities of the farms, the mines, the forests and the fisheries are absolutely exempted.


Mr. PEDLOW:: This, then, is for the benefit more particularly of the lumber interests. I was under the impression that they were in a class by themselves and well able to take care of a tax proposition of this kind; I was not aware that they were exactly in the same class as the fishermen, the farmers and the miners. I fail to apprehend why special consideration should be given to lumber-

men. They are considered wealthy people and, I should think, well able to bear an imposition of this kind.


Mr. NESBITT:: They are not all wealthy by any means.


Mr. SIMPSON:: Would not the tax bear pretty heavily on settlers who get out their own pulpwood? That is the only means some of them have of making a livelihood in the winter time, and the tax as suggested by my hon. friend would, I think, bear pretty heavily on them.


Henry Lumley Drayton: In answer to the hon. gentleman I can very well understand his not having got the whole of this long resolution thoroughly digested. I know I have great difficulty myself in recollecting the whole of it. But I should like to point out to him that this provision only helps the primary activity; it does not help the operations of the large lumber companies, except to the extent that we are not increasing the rate on lumber by not putting the extra one-half per cent on each transaction; to that extent it may be said we are doing something for the lumber companies; but, on the other hand, there is a great deal to be said in connection with the high cost of lumber and its effect upon building operations. What are exempted are the farmers and settlers' activities, the logs they get out, round and unmanufactured timber, fence posts, railway ties, pulpwood, tan bark and other articles-the products of the forests when produced and sold by the individual settler or farmer. What we are doing, is, as I say, making all the activities of the farmer, so far as he is directly concerned, free of tax.


Isaac Ellis Pedlow: Then, Mr. Chairman, no ruling of the department would exempt operations by large lumbermen. That being the case, the point raised by the hon. member (Mr. Simpson) a few minutes ago regarding the taking out of pulpwood by the individual settler would be covered by this sub-provision, but it would not apply to operations by large lumber concerns?


Mr. CALDWELL:: Would this include hewn timber got out by the new settler? I have in mind unmanufactured timber- squared timber.


Henry Lumley Drayton: The qualification "unmanufactured" refers to activities of those other than farmers. Any one of the big companies to which the hon.

member for Renfrew was referring could get out their logs in the first instance without paying on them; they would pay on their lumber, not on their logs. So far as the farmer is concerned all products of the forests that he produces are free.


Charles Arthur Gauvreau: Will the minister explain circular No. 75C which was sent to me the other day? I was plainly told that the farmers would have to pay a tax on the amount charged for the sawing of their logs in the mill.


Henry Lumley Drayton: That, of
course, is under the old law. This new law will supersede it.


Charles Arthur Gauvreau: Then circular No. 75C will be got rid of?


Henry Lumley Drayton: All the old circulars will go.


James Alexander Robb: Will this tax be imposed on the price f.o.b. mill or on the price at the point of delivery?


Henry Lumley Drayton: The tax is on the consideration of the sale, whatever that may be.


[Stage Direction]
Amendment agreed to.
Henry Lumley Drayton: I wish to
move a further amendment: that in the proviso .which deals with exemptions, in the 8th line after the word "state," there be added the following words:
bran, shorts, oil oake, oil cake meal, grains mixed or crushed for poultry feed.


James Alexander Robb: The minister has not included cattle feed. I would point out that more grain mixed and crushed is sold for cattle feed than is sold for poultry feed. According to the amendment, the exemption would apply only to grains mixed or crushed for poultry feed.


Henry Lumley Drayton: I thought I
had made it clear; my intention is to do just what the hon. gentleman has in mind. If there is any doubt about it, the words "cattle or" may be added before the words "poultry feed."


Georges Henri Boivin: "Grains mixed or
crushed for cattle or poultry feed".


Mr. KENNEDY (Glengarry) :: If it is the intention to include all feeds that are sold as cattle feed, I would point out that the minister is discriminating against certain kinds of feed that are made in this country-gluten feed, for instance, distillers' grain and brewers' grain. These are all sold quite extensively for cattle feed,

I do not rise to offer any particular objection, but there is an evident discrimination here.


Henry Lumley Drayton: I am afraid we cannot go further; we have gone as far as possible to look after the real essentials. We are not thinking of patent feeds or manufacturers' names, or anything of that kind. I will not say for a moment that it is possible to provide for every single contingency that might arise in connection with this taxation-it cannot be done.
It may be that in this discussion something else may be found which properly, economically ought to be exempt, and power is reserved to the Governor in Council to make further and other exemptions should occasion require that.


John Wilfred Kennedy: I am
quite willing that the minister should get after those compounds to which he refers as patent foods; but gluten meal is a byproduct of the starch factories; it is in the same class as oil cake or oil cake meal.


William Stevens Fielding: Has the minister been able to give any attention to the point that I raised, whether he should not include in [DOT] the list of exemptions the manufacture of small boats, coastal or fishing boats.


Henry Lumley Drayton: That is a matter that I am entirely in sympathy with, but it is a little difficult to work it out. I gave instructions for a resolution to be drawn. I have not been able to get the proper, definite information which will enable us clearly to carry out what the hon. gentleman desires to have done. It is a matter which will be taken care of at the first possible minute by Order in Council.


William Stevens Fielding: If I have the word of the minister that sales of these boats will be exempt and that the manufacturer of these boats is not to be taxed, or required to take out a license, I am satisfied. 1 notice that I am reported in Hansard as saying that on that subject I have had trouble with the department. That is hardly correct. I have had no trouble with the department. I have had to trouble the department occasionally with cases of this kind, but in every case I have received every attention and courtesy from the department, and I was not intending to complain of it.


Mr. DUFF:: I intended to speak of the point brought up by the hon. member for Shelburne and Queen's (Mr. Fielding) regarding fishing boats, and also the section of the clause which reads:
Ships licensed to engage in the Canadian coastal trade.
It seems to me that it would be only right and proper that, not only ships engaged in coastal trade, but ships engaged in fishing, should be exempted. The easiest way to get over the difficulty with regard to both fishing vessels and coastal boats would be to make that part of the clause read:
Ships and boats engaged in the Canadian coastal and fishing trade.
The minister will see in a moment that it is more important to have fishing vessels exempted than even coastal vessels. As regards the previous phrase:
Materials for use only in the construction, equipment and repair of ships.
I would suggest that in order to include the fishing industry, which is one of the basic industries of the country, that might very well read:
Materials for use only in the construction, equipment and repair of ships and fishing boats.
In justice to this great industry and to encourage it, fishing boats should be included in the list of exemptions.


Henry Lumley Drayton: We will certainly go very carefully into the matter with a view of defining it.


William Stevens Fielding: A fishing vessel, I
imagine, would be held to be a coastal vessel.


William Duff: No.


William Stevens Fielding: A vessel when she is not catching fish is apt to carry a cargo along the coast. I quite agree, however, with the hon. member for Lunenburg (Mr. Duff) that if there is any doubt about the matter, it is well to have it defined.


Mr. ARMSTRONG (Lambton) :: What action has the minister taken regarding this paragraph:
Materials for use solely in the manufacture of oleomargarine or any substitute for butter or lard or for the production of cottolene.
The minister must be well aware that the price of butter in Canada to-day is down to the pre-war rate and even below it. If you are to allow to enter Canada all kinds of material for the manufacture of these articles, then to allow the manufacturers to take the butter produced by the farmer and mix it with their different materials, and then allow the product to go

on sale in opposition to the sale of butter, I cannot help thinking that, to say the least, you are interfering with the dairy market. Has the minister seriously considered the question of placing a duty on materials that are coming into Canada for the manufacture of butter substitutes?


Georges Henri Boivin: Had we not better adopt the amendment before we discuss the question of oleomargarine?


James Alexander Robb: Before the amendment is adopted, I would like to point out to the minister that I am ready to support him in this, that I think it is good legislation to exempt the' cattle feeds that he has enumerated; but if he exempts cottonseed and oil cake meal, there is no reason why he should not exempt gluten meal, which is also used on the farm.


Henry Lumley Drayton: We have
taken power to. give further exemptions, and that matter will be carefully looked into.


Mr. THOMSON (Qu'Appelle) :: It is
difficult to find out just what is intended by amendments which we have never seen and which we merely hear discussed back and forth. I understand the minister is including in exemptions, brans, shorts and certain crushed feed. I caught the expression "mixed grain."


Henry Lumley Drayton: Crushed
grains.


Levi Thomson: Crushed grains of any kind. Grain unmixed with crushed grain would be exempt.


Henry Lumley Drayton: All grains
were exempt. The term "crushed grains" was put in just to make the matter absolutely sure.


Edward Walter Nesbitt: With reference to cottonseed meal and oil cake, I think they come under the same head as gluten meal, but I think they all ought to pay the sales tax and not be exempted. They are after all manufactured goods. Bran and shorts are by-products.


[Stage Direction]
Amendment agreed to.
Mr. HAROLD- While we are on the discussion of additions to this list of goods to be exempted from this tax, I should like to bring before the committee, for the consideration of the Minister of Finance, a question that was brought up last year, namely the exemption of fibre, for us only in the manufacture of binder twine. We discussed that very fully last year, and it

was put on the free list. I think, through a misunderstanding, it was left off this year, and the way in which the matter works out under the regulations as they are now proposed, is that the Canadian manufacturer has to pay a 2i pei cent import duty on his raw materials Then when he ships his goods out to the retailer, he has to pay 3 per cent under the retail tax, or, all told, 5i per cent; whereas the United States manufacturer shipping his goods in here direct to the retailer has to pay only 4 per cent of an import duty. That leaves the Canadian manufacturer with a handicap of 1J per cent, as the finished goods come in free. The Canadian manufacturer has fixed his price for the- season, and he has based his cost upon the cost of these materials free from this tax. If he is compelled to pay it, it will certainly be a very serious thing for him, and it may result in a loss	on his season's operations.
The reason I feel that it should come up now and not be left until after this Bill has passed is in order to avoid raising the difficult question with regard to rebate on any material that has been imported. I have a letter from one manufacturer in which he says that he has paid duty already on one shipment amounting to nearly $600. I do not see how anybody can object to this change as it is with respect to an industry that is without a particle of protection. It is in one sense a great handicap from the fact that it has to pay taxes in this country while competing with the output of large concerns on the other side which contribute absolutely nothing to the treasury except this import tax. The matter was gone into very fully last year, and the minister, realizing the situation, made this alteration. So far as the farmers are concerned, this could not help but tend towards being a benefit to them, because if the thx remains on, the Canadian manufacturer would certainly have to add that tax on his raw material to the price of his finished product, if he could get the price. I do not think that any person can reasonably object to this action on the part of the Government.
Mr. COCKSHUTT:: I would like to join
my voice to that of the hon. member for Brant (Mr. Harold) in his request. We have a large institution manufacturing binder twine in the city of Brantford, employing a large number of hands, and with a good deal of farmers' capital invested in the enterprise. It is working under absolutely free trade conditions, and I cannot

imagine that any one in this House would ask that a business that is without any protection whatever should be placed under a handicap as compared with the competition that it has to meet from the south of the line. This industry has had a difficult career, but has managed to weather the storm with absolute free trade in that particular article, through success in its purchasing of raw material and the great deal of foresight that has been exercised by the management for a great many years.
I do trust that the Minister of Finance will give the request of the hon. member for Brant his very serious consideration, because I cannot imagine that anybody would wish to place an extra 11 per cent on an article in such universal use as this, on which the margin of profit is small, and which is an industry that it is very desirable should be maintained in Canada. There are only three factories left in Canada manufacturing binder twine, and I hope the minister will see his way clear to grant this small concession with respect to the raw material entering into the manufacturing of binder twine.


Isaac Ellis Pedlow: I would like to direct
the attention of the House to one fact that has been brought out by the hon. member ' for Brantford, and that is that all that is necessary to make a success of a Canadian factory is good management, plus free trade. I am delighted to know that the hon. member for Brantford is a convert to that idea.


Mr. SUTHERLAND:: I appreciate the
difficulties of the Minister of Finance in securing revenues to meet our obligations. I do think, however, that there are some industries in this country that ought to fc encouraged 'as much as possible, and consequently I quite agree with the exception that has been taken by the hon. member for East Lambton (Mr. Armstrong). In connection with the articles which are being exempted, particularly importations into this country of cream, butter, cheese, oleomargarine, margarine, butterine or other substitutes for butter, eggs, vegetables, fruits, grains and so forth, I think we all realize that there is altogether too much of our money being paid to the United States for products that we could very well raise in this country. That was more noticeable during the last month perhaps than at any other time. As the result of the tremendous importations from the United States, one of these articles- butter-has dropped 25 cents a pound in price in one week. I have here a publication of the Department of Agriculture giving importations for the month of March and I find that there were 753,726 pounds of butter, and 374,672 pounds of oleomargarine imported in that month, and that the total of dairy products imported was 1,607,741 pounds. Our money was paid out to the United States for this stuff at a time when we were looking for markets abroad for our own produce.
While dealing with this matter, I might point out that it has engaged the attention of the House on quite a number of occasions. My hon. friend from East Lambton has mentioned the exemption with respect to materials for use solely in the manufac-ure of oleomargarine or any substitute for butter, or lard, or for the production of cottolene. It is somewhat interesting to note how many of these different ingredients are used by the manufacturers of oleomargarine, who are carrying on this business of the adulteration of butter. Their business is not the manufacturing of oleomargarine at all, but the adulteration of butter. I would not take any exception to importing margarine into this country and manufacturing it, but what I do object to, and have objected to all along, is permitting these manufacturers to adulterate butter, which is the right that has been given to them under the regulations under which they are carrying on. There are two manufacturers in Canada, both in Ontario, engaged in this business. We are told that there have been circulars issued by them and by other associations to every member of the House pointing out that it was a Canadian product that was being used to adulterate butter, and that consequently the manufacture of oleomargarine was to the advantage of some branch of agriculture in Canada, particularly oleo oil.
What is the real situation? For the eleven months of the past year, the latest returns that I have, oleo oils were imported into this country to the extent of 1,714,562 pounds, for the purpose of adulterating butter. Cotton seed oil was imported to the amount of 889,208 pounds. These importations together with those of salt, stearine, butter oil, peanut oil, corn oil, cocoanut oil, aggregated 3,680,350 pounds. Now there is a desire on the part of the Government and of every one else to encourage Canadian manufacturers and Canadian producers. I want to point out that 99 per cent of the duty paid on these articles in the past year has been rebated to these two manufacturers, or an amount of $138,367.34. I think that instead of

exempting the importation of this stuff from any tax, as we are doing in this resolution, we should endeavour to protect and encourage our own industries. There has been dumped on the markets of this country during the past three months immense quantities of dairy products from Denmark, Holland, the Argentine, and the United States, of a very inferior quality. This stuff was churned in the churns of certain manufacturers in the city of Toronto, and placed on the market because it had very little value as it was. This is the sort of thing that has been going on for some time. We speak about the need for protection. If ever there was a time in the history of this country when the dairying industry needed some consideration and encouragement, it is now. I think we should be well advised, not only in putting a tax on the imports, hut also in increasing the protective tariff against these inferior articles which have been brought into this country to such a large extent during the last few months. I have repeatedly pointed out the effect of this matter. The great objection is that we are exempting articles that are being brought in and used by the manufacturers to adulterate butter. That is really what the business is; they are not really manufacturing oleomargarine at all. What does adulteration mean? It means the mixing of base materials with something superior, and that is the very thing that the manufacturers of oleomargarine are doing. The manufacturers of butter are prevented from doing anything of that kind because they are surrounded with regulations, municipal, provincial and federal. These regulations are designed to ensure the purity of butter, and we immediately discard all these provisions and permit certain manufacturers to get a license to buy that article by millions of pounds and adulterate it with these inferior commodities. It is the purpose of this 'schedule to permit that stuff to come in without being taxed, I think we should place a heavy tax on such importations introduced for the purpose of adulterating good food.


Mr. HENDERS:: I endorse what has been said by the three last speakers. We are dealing with two specific articles in connection with which some consideration should he given the industries concerned. As regards binder twine, the present arrangement will have two effects. It will place the manufacturer of this article in 
Canada at a disadvantage, as compared with the American manufacturer, and as a result the cost will be increased to the consumer, and the farmer will be affected. I think, therefore, that some consideration should be given that point. I am in perfect accord with the views expressed by the last speaker (Mr. Sutherland) . A year ago, perhaps, I would not have taken this position, when butter was selling at 75 cents, 80 cents, 85 and 90 cents a pound. The poorer people of the country were in such a position that a strong argument could be advanced for giving them a cheaper article to take the place of butter. But with butter at its present price-and the probability is that it will be lower instead of higher-there is a great deal of force in what my hon. friend from South Oxford has said.


Mr. KNOX:: I regret to have to ask the committee to revert to a former item, but I want to ask the minister a question with regard to cord wood used for fuel purposes.


Henry Lumley Drayton: All fuel is
free.


Andrew Knox: Then my question is not necessary.


Mr. McGIBBON (Muskoka) :: I would impress upon the minister the importance of a sane and logical position when we are protecting industries. We are protecting nearly every industry, because we are a protective country, and yet we foolishly allow one of the greatest industries to go unprotected. That is not sound or logical, nor is it in the interests of Canada. As I said the other night, we might very well, at this time, take a lesson from the United States. We know what they are doing to protect the farmers of that country, and we are not so foolish as to believe that their action will not have some effect on this country.
I would therefore impress upon the Government the necessity of giving to the farmers of Canada some protection along these lines.


Mr. McQUARRIE:: I support the last speaker. In British Columbia, under present conditions, our farmers are very much in need of some protection. The other day I received a letter-I notice some of the Agrarians smiling-from a branch of the United Farmers of British Columbia. I am sorry I have not that letter here; it is in my room, but I will bring it down

later. It was accompanied by a copy of a resolution passed at a meeting of the Surrey and Barnston Island branch of the United Farmers of British Columbia, urging very strongly that some extra measure of protection be provided the farmers of that province, and mentioning particularly butter, poultry, eggs, and other farm produce of that kind.


Mr. DENIS:: What about tobacco?


William Garland McQuarrie: It is also stated that the market was being flooded with American goods.


Mr. LALOR:: Reciprocity.


William Garland McQuarrie: Personally, I am quite familiar with the condition which prevails in that province, and I know that our farmers are suffering very severely.
I do not think the member for Marquette (Mr. Crerar), will have very much support out in that country for the doctrine he is preaching in the Prairie Provinces. It may be that our conditions are peculiar in some ways, inasmuch as the markets of Westminister and Vancouver are situated so close to the boundary line, and are the best markets for the northern part of the state of Washington. Now, the farmers in Washington are shipping in by truckloads large quantities of all kinds of produce, and as they have the benefit of several weeks in the matter of time, they can send in their goods before the farmers in our part of the country can put their produce on the market, and therefore they have a much more favourable market than our people can find later on. I am very glad the subject has been mentioned, and I hope the minister will give this matter his very serious consideration. I am sure I speak for the great majority of the farmers of British Columbia when I say they want protection, and still more protection.


Henry Lumley Drayton: I have in my hand a table of the importations of butter into Canada. I have been trying to follow weekly, and sometimes daily, these importations. At the present time we want to keep as much money at home for Canada as we can, and 1 have therefore been interested in this matter. I happened to have this list in my pocket, and it will probably be interesting to say what the imports actually are. Of course, there is practically nothing from the United Kingdom; the imports of butter for the fiscal year amounted to 112 pounds. There
was practically nothing from Newfoundland, the imports amounting to 1,049 lbs. New Zealand, on the other hand had a good deal larger export to Canada; she sold us 1,533,280 lbs. Holland sold us only 110 lbs., but our imports from the United States amounted to 2,207,077 lbs. These are the figures for the past fiscal year ending March 31. The figures for the month of April last show an importa-tation from New Zealand of 90,776 lbs., and from the United States, 576,061 lbs. It will be observed that the importations of butter from the United States for the whole of the previous year were 2,200,000 pounds of butter and for last month, 576,061 pounds, showing a large increase in American importations. Now there is a duty of four cents a pound on butter, but I am afraid we cannot very well discuss protection or the tariff on the sales tax, and however one may sympathize, and ought to sympathize, with the dairymen this is not the time for us to consider that matter. There is still on the Order Paper an oleomargarine resolution in connection with which that matter might properly be discussed, but I am afraid we cannot take it up in connection with this sales tax resolution.


William Stevens Fielding: It is pleasing to know that in the calm and agreeable atmosphere of the last day or two some light has been coming to hon. gentlemen opposite, including my hon. friend from Brantford. Hon. gentlemen opposite have within the past twenty-four hours voted that they do not want any tariff revision, and now they are giving us many reasons why the tariff ought to be revised.


Donald Sutherland: The exception I take to the exemption from taxation of butter importations into this country is, I contend, a legitimate matter to discuss in connection with this resolution, which specifically mentions the importations which shall be exempt from the tax we propose to place on other articles. With reference to the importations of butter I am a little surprised that they do not amount to more than the figures given by the minister of 576,061 pounds for the month of April. Could the minister give us the importations for the month of March?


Henry Lumley Drayton: They would be included in the total of the two millions odd for the year.


Donald Sutherland: 1 have here a copy of the report which is sent to mem-

hers from the Markets Division of the Dairy and Cold Storage Branch of the Department of Agriculture and it gives the importations into Canada from the United States of dairy products and oleomargarine. Why they should include oleomargarine with dairy products is beyond my comprehension. In France the retailer is not permitted tc sell the two articles, yet you find it included with butter in the market reports of the Dairy and Cold Storage Branch of the Canadian Department of Agriculture. According to the report in question the following importations from the United States were made in the month
of March:
Lbs.
Butter	 753,726
Cheese	 64,243
Condensed milk	 7,200
Evaporated milk	 240
Buttermilk	 7,660
Oleomargarine	 374,672
Total	 1,207,741
Now that is quite a large quantity of this stuff to be dumped into this country during one month and the effect of it, as I have already pointed out, is that the market for butter broke to the extent of over twenty-five cents a pound in one week, and I fear that before three months are over the price will be very much lower than it is to-day. Although the people in the constituency which I have the honour to represent are not much interested in the butter making industry, yet I fully appreciate the importance of butter making to this country. I believe it is really the foundation of the live stock industry of Canada. You may manufacture cheese, condense milk, buttermilk, or other things, but in so doing you get away from the real live stock business of the country. You cannot afford to feed whole milk in order to raise young stock because it is altogether too expensive. Therefore butter making, to my mind, is the most important and most essential branch of agriculture we have in the Dominion. If we are going to maintain that industry we must increase the fertility of our soil and pay more attention to the live stock industry. The butter making which is carried on in some other parts of the country, in my opinion is the most important of all, I would strongly recommend that when the proper time comes the present duty should be increased. In the meantime I would impose a tax upon the importation of all the articles mentioned that are coming into this country, and in particular on the ingredients that go into the manufacture of oleomargarine.


William Stevens Fielding: The hon. member has half a dozen times used the expression that millions of pounds of butter are being "dumped into Canada." Now dumping has a technical meaning, we have a law against dumping, and if my hon. friend is correct that these goods have been "dumped" into Canada he has made a very serious reflection upon the Department of Customs. I do not think he is correct, I am willing to believe that the Department of Customs is enforcing the anti-dumping law. When the hon. gentleman uses the word "dumping" he is doubtless using it in the broad sense that a large quantity of the goods to which he refers has been imported. I take it for granted he is correct in that, but when he says these goods have been dumped into Canada I think perhaps, it expresses a meaning beyond what my hon. friend intended.


William Garland McQuarrie: 
Edward Walter Nesbitt: Does my hon. friend
want a sales tax put on eggs? Of course, it is the sales tax we are dealing with.


William Garland McQuarrie: I am speaking on a matter that was brought up by several hon. gentlemen who suggested that some kind of customs duty should be imposed on foreign produce.


Edward Walter Nesbitt: We cannot do that here.


Isaac Ellis Pedlow: Each egg would have to be branded under the law before being imported.


Sir GEORGE FOSTER:: It is going to be arranged so the hen does that.


Isaac Ellis Pedlow: I would suggest that the Minister of Finance supply the hens interested with a rubber stamp attachment.
Mr, FIELDING: I did not want to raise a point of order against my hon. friend
from New Westminster so I allowed him to read his letter. But evidently he has made a mistake. He should have produced this in the Budget debate before he voted that the tariff was right.


Levi Thomson: We have spent two full weeks' discussing free trade and protection, but our high protectionist friends on the other side do not seem to be satisfied yet.


Edward Walter Nesbitt: Do not let us prolong the Budget discussion.


Levi Thomson: As my hon. friend from Shelburne and Queen's has said, they did not want to revise the tariff, but now apparently they are bent on revising it. They did not vote properly the other day; they made a mistake, as they admit themselves, and should have voted on the other side. There may be some farmers throughout the Dominion who are anxious to raise their prices by protection so that the unemployed workingmen may have to pay more for their food, but our farmers generally want protection only from the protected interests. We have had some remarks made that should receive consideration, and it seems to me that these other things are thrown into distract attention. I should like to know from the minister whether there is anything in the point raised by my hon. friend from Brant. I do not know that I grasped exactly the way in which he suggested that our manufacturers of binder twine would have to pay one and a half cent more than the importer. If there is anything in that I think it should receive attention.	^


Henry Lumley Drayton: I would submit, Mr. Chairman, that we will have to consider any further tariff discussion on this sales tax as out of order.


Some hon. MEMBERS:: Hear, hear.


Henry Lumley Drayton: I believe there is a great deal in the point raised by the hon. member for Brant, and I agree very largely with what he has said. I shall have the same pleasure in taking it up as I shall have in considering what my hon. friend from Shelburne and Queen's suggested in connection with fishing boats, with a view to taking action.


James Alexander Robb: The minister has promised
to reconsider the tax on the lumber interests. May I suggest in that connection that he take into consideration this feature?

If it is desirable to exempt from the sales tax lumber that goes into the construction of ships, would it not be well to reconsider upon what basis we should tax lumber going into the construction of houses, harns and stables ?


Henry Lumley Drayton: There is a
further amendment I wish to move before the clause is adopted, Mr. Chairman, and although it is fairly long it is very simple. Before the basis of taxation was arrived at and adopted submissions were received as to the best methods of raising the required revenue from witnesses in every walk of life, from boards of trade and kindred commercial associations and from farmers' institutes who appeared before the Tariff Commission. One of the things which was urged from time to time was the general turnover tax, and in that connection the desire was expressed that book-keeping troubles should be saved and that the tax should not be shown separately upon the invoice. Since the resolution has been brought down on looking further into the matter and having particular regard to the question of checking revenues, we have come to the conclusion that we had better stick to the law as we had it before. Taking that course, I move:
That the following words be added after the word "cent" on third line of page 8 of Resolutions :
"that the purchaser shall be furnished with a written invoice of any sale, which invoice shall state separately the amount of such tax to at least the extent of one and one-half per cent but such tax must not be included in the manufacturer's, producer's or wholesaler's costs on which profit is calculated; and the tax ishall be payable iby 'the purchaser to the wholesaler, producer or manufacturer at the time of such sale, and by the wholesaler, producer or manufacturer to His Majesty in accordance with such regulations as may be prescribed, and such wholesaler, producer or manufacturer shall be liable to a penalty not exceeding five hundred dollars, if such payments are not made, and in addition shall be liable to a penalty equal to double the amount of the excise duties unpaid; that the term "duty paid value" means the value of the article as it would be determined for the purpose of calculating an ad valorem duty upon the importation of same into Canada under the laws relating to the Customs and the Customs Tariff whether such article be in fact subject to ad valorem or other duty or not, and in addition the amount of the Customs duties, if any, payable thereon".


Isaac Ellis Pedlow: I have in my hand a clipping from the Ottawa Journal of May 13, 1921, which reads as follows:
Wholesalers oppose the Sales Tax Change

Want Levy Shown Separately on the Invoices.
Montreal, May 17.-In connection with protests against the proposals of the Minister of

Finance, as outlined in the Budget, the branches of the local Board of Trade have been busy passing resolutions of dissatisfaction and forwarding them to Sir Henry Drayton. In addition to the Wholesale Grocers' Guild and the Produce Merchants' Association, the Montreal Wholesale Drygoods Association held a meeting to-day, and adopted a resolution supporting the principle of setting out on the invoice the amount of sales tax, apart from the costs, and directed their secretary to send copies of this resolution to the drygoods sections of the Boards of Trade of Toronto, Winnipeg, Quebec and Halifax for further consideration and action. A meeting of the lumber association to consider similar questions will be held here to-morrow.
It would appear that this change has been made in response to the protests received from the sources indicated in this despatch. Now, I 'am distinctly opposed to this change. I may be out of harmony with the wishes of the Retail Merchants' Association of Canada, just as I was out of harmony a year ago with the resolution presented to the Minister of Finance by that association. If the minister had listened to the suggestions which I made then, he would not only have saved himself a considerable amount of trouble but he would have saved the retail trade of this country an enormous amount of worry, annoyance and dissatisfaction. The statement which I made on that occasion will be found on page 3341 of Hansard, session of 1920, volume 4. On that occasion I said:
The Minister of Finance has decided on a certain method of collecting these taxes. It does not meet with my approval and I would suggest some other method, tout he is the man in charge of the ship and he is responsible.
Further on I said:
We have to raise the money, and if the Minister of Finance has decided that this is the best way in which to raise it, we have no alternative but to submit and try it out.
Further on in the discussion I said:
I should like to persuade him to try another method, but I understand that is impossible.
I may add that during that discussion I quoted from a resolution presented to the minister by the Retail Merchants' Association, drygoods section, endorsing the principle of collecting the revenue through the medium of the luxury tax. This resolution had been endorsed by the association and presented to the minister on the occasion of a meeting with him at the Chateau Laurier. Now, the House had scarcely prorogued after the session of 1920 when protests started to come in from all directions, and from that day until the luxury tax was abolished in December the minister must have had an interesting time

[DOT]of it because of the protests which came from all parts of Canada. I believed then that for an emergency the collection of a sales tax would be the best way of raising revenue. My suggestion then, as it is today, was the placing of a one per cent sales tax on each turnover. The present proposal is too involved: there is a one and one-half per cent tax on turn-
5 p.m. over from manufacturer and wholesaler to retailer; a two and one-half per cent tax on sales direct from the manufacturer to the retailer or consumer, a three per cent tax along another line, and, in addition, a four per cent tax on goods imported direct by retailer or consumer. Now, this will entail a great deal of checking and an enormous amount of work on the part of the importer as well as on the part of the Inland Revenue Department. If a simple tax of one per cent had been levied by the minister on each turnover he would have received as much money from the consumer, who in the final analysis must pay this tax-in fact he might have received more. I further want to go on record as favouring the principle of collecting this tax from the seller on each turnover. The principle adopted in this resolution means that the purchaser, not the seller, will have to pay the tax in each case. In my judgment the method I propose would simplify the whole system of collection and produce the returns aimed at by the Budget. I notice that in his Budget the minister has made a statement with regard to the retail trade in this country which in my judgment is not a fair statement, although I am sure the minister did not wish to be unfair to any section of the community. Here is what he said, as it appears on page 15 of the copies of the Budget speech which have been printed and distributed:
In practical administration, though, in view of the fact that after careful survey it has been established that books are not kept in many retail stores-*
I have discussed this subject with many of the men who are doing field work for the Income Tax Department, and while they admit that some retail merchants do not keep a set of books by double entry or by some other approved system, still there is hardly one that they meet in their entire travels, that does not keep a record of his sales. I should like the minister to bear that point in mind. Therefore if you establish a sales tax, you have no difficulty about a man keeping a record of his sales, so that the difficulty suggested my this statement
is not as great as it would seem if looked at from the viewpoint from which the minister looked at it. If I am correct-and I honestly believe I am-that a very small minority of those carrying on retail businesses of one class or another will be found who do not keep records of their sales, it should be a simple matter to collect a revenue on the basis of a sales or turnover tax. I am informed by very intelligent men in the service of the Income Tax Department that this is the only basis upon which, in many cases, they are able to work out an income tax return. Therefore, if they are able to work out an income tax on the basis of the record of sales of merchants, it should be a very simple matter for the department to collect a sales tax of one per cent on the turnover. A turnover tax of one per cent would be paid, in the first instance, by the importer or manufacturer, then a turnover tax of one per cent by the wholesaler or jobber, and, last, a turnover tax of one per cent by the retailer or distributor. I know a system of that kind is and has been in operation since 1905 in the Philippine Islands, and they collect a turnover tax along the lines that I suggest, but they make it apply rather from a certain amount of sales or turnover upwards. That is to say, a firm doing a certain amount of business during the year is exempted or is not bothered with, because the amount is too small; they do not look to firms of that kind for a sales tax. I feel satisfied, since the minister has committed himself to the proposition, that, as last year, he will go on with it; but I can assure him now, as I assured him a year ago, that he will have no end of difficulty, and that the men in the retail merchants' associations who are at present supporting him will be the first ones to turn round on him before the year has progressed very far.


The CHAIRMAN (Mr. Steele) :: Shall
the amendment carry?


James Alexander Robb: The minister promised some consideration to the different lumber items.


Henry Lumley Drayton: I said that I
would consider the matter just as I am considering what was urged by the hon. member for Shelburne and Queen's (Mr. Fielding) in regard to boats.


William Stevens Fielding: As regards the question of the amendment which my hon. friend has moved, I can understand the argument that the tax, whatever it might

be, should be shown on the invoice. Whether that is wise or not, is a matter to be argued. But if a tax is to be shown, the actual tax should be shown. The taxes are 14, 24, 3 and 4 per cent, while according to the amendment moved by the minister, no tax except the one of 14 per cent shall be shown on the invoice. If any reference is to be made to the tax, why should the whole tax not be shown?


Henry Lumley Drayton: This follows the principle of last year. 'One-half of the tax may be absorbed; the rest of it must be shown.


William Stevens Fielding: The fact that a thing was done last year is not conclusive that it is wise. Why not show the real tax? why are the people to be deceived by the exhibition on the invoice of a tax of 14 per cent, when the real tax is 4 per cent?


Mr. HAROLD:: The real reason for that is that the wholesaler charges the retailer li per cent, and a manufacturer shipping directly to a retailer wants the privilege of being able to charge exactly the same rate as the wholesaler. The invoice bears the same rate; but when it comes to a matter of putting on the sales tax, the jobber has the advantage in so far as he can show on the invoice a tax of only 14 per cent. That is the reason why this method was adopted, and it has worked out quite satisfactorily. I believe, if the matter is left in the way in which the minister has it, it will continue to work out all right. In my experience, I do not remember seeing an invoice on which the actual amount of the tax was not shown; but there may be instances where a business is figured very closely, and where the manufacturer or the original producer may wish to have that privilege of selling as cheaply as the wholesaler.


William Stevens Fielding: I have difficulty in understanding why the actual tax is not to be shown. If there is any point in showing the tax on the invoice, the whole tax should be shown. The matter may have been discussed last year, and it may have escaped my memory. What the hon. member (Mr. Harold) says is that the manufacturer or dealer may not wish it to be known what the tax really is. I do not think that is a good reason. If there are good reasons why the tax should be shown on the invoice, the statement should be an honest one as regards the tax that is paid.


Henry Lumley Drayton: The whole
idea of it is that we ape trying to deal 
fairly with both classes of business activities. There are manufacturers and wholesalers. Some manufacturers sell directly; some iise wholesalers. If a manufacturer was obliged to show the whole of the tax on the invoice, he would be showing a tax twice as great as that which the wholesaler has the right to show. The transaction is entirely with people who understand the business; this is not a question of dealing with the public at all as there is no tax upon sales from the retailer. This is merely in the trade, and it enables manufacturers to sell directly if they so desire without selling through middlemen, allowing them to pay, at their own expense, part of the tax which they are not showing.


James Alexander Robb: Certain commodities are
exempt from taxation. Let us say that a mill is turning out cement. Cement is exempt, is it not?


Henry Lumley Drayton: No.


James Alexander Robb: Flour is exempt. Supposing a car of 500 bags of flour is going out. The approximate value of that at present would be $2,500; but there is a tax on the container, and the mill, under this proposed amendment, will be compelled to show 14 per cent on the invoice. That at the value of bags to-day would represent approximately 75 cents. I am satisfied that flour millers will not object to pay the tax; but would it not be more economical if they were to pay it when they buy the bags? Why compel a mill to keep a bookkeeper to look after this, because it will require practically a special man to look after and total this all up, and it will involve additional expense upon the department to look after it.


Henry Lumley Drayton: It is entirely
optional with the miller what he does. He may sell containers or he may not. The usual way of doing business is to make a lump charge for your commodity.


Edward Walter Nesbitt: Including the bags?


Henry Lumley Drayton: Yes, and in that case there is no' tax on it. If the miller is going to make a separate charge for a container, there is a tax.


James Alexander Robb: The minister rules that it is not necessary that the miller should show this tax on his invoice.


Henry Lumley Drayton: Not in the flour business.


Edward Walter Nesbitt: Not unless he charges for the containers. If you invoice me a carload of bran, you invoice me that at a certain price per ton; you do not charge for the bags separately. If you do it in that way there is no percentage charge.


James Alexander Robb: I understood from the minister's statement a moment ago that as regards anything on which there was a tax, the man must show the tax on the invoice.


Henry Lumley Drayton: It depends
upon the sale in each case.


Edward Walter Nesbitt: He pays his sales tax
when he receives the bags to the fellow who makes them, but he absorbs that tax.


Donald Sutherland: I notice that
cream, butter, cheese, milk and so forth are mentioned in the amendment, but not condensed milk, or powdered milk. Might not those be included?


Henry Lumley Drayton: We will consider that.	-


Jean-Joseph Denis: :	I think it is hardly fair
for the minister to patch up this resolution in the way he is doing by amendment after amendment of which no notice has been given. I have been trying to get a copy of the last amendment, but have not been able to do so, and even if I should receive a copy, it would be difficult at this moment to discuss it intelligently without having seen it before. I have no doubt the minister is acting in good faith, but I do not think he is doing justice to the committee in bringing forward amendments in this way. Copies of the amendment should have been distributed in advance.


Henry Lumley Drayton: Here is a
copy of the amendment for my hon. friend. It will be just the same method as last year.


Jean-Joseph Denis: The amendment is a long
one, of twenty-five lines. How can an hon. member express an opinion on such an important amendment that he now sees for the first time? I shall have to discuss the amendment as I understand it at the moment, but I say that it is not fair to the committee. If I understand the amendment rightly, we are reverting to the method of last year in collecting the tax.


Henry Lumley Drayton: It will be the same plan as last year.


Jean-Joseph Denis: In the Budget the minister proposed a different plan from that of last year, but now he is going to revert to the method of last year. What about the
public and the trade who are interested in this Bill, and who have been informed by. the minister in his Budget speech that the plan of collection is going to be changed, and that the tax would be imposed at the point of production and the point of entry. Now the minister comes along and changes his plan altogether. I must say that I am not favourable to this sales tax, but apart from the principle, I was favourable to the method of collection which was announced by the minister in his Budget this year. Now he says that that method will not be adopted, but that he will revert to the plan of last year. I have nothing more to say at the moment, except that it is not fair to the committee or the trade and the public generally to change the method and pass the resolution without any more notice than has been given this afternoon.


Isaac Ellis Pedlow: I read an extract from
the Ottawa Journal a few moments ago, and I intended to make some further comments on that feature of the situation. In my judgment the minister has made this change in order to comply with the requests of the wholesale trade, the manufacturers, and other big interests in Montreal. Just a few days prior to the day on which the item I read appeared, there was another item in the press to the effect that the wholesale trade were at logger-heads regarding the collection of this tax, that some of them were absorbing it, and others were not. They were using the tax as a lever for inducing business. In order to combine upon a plan, all those interested in this matter met together and forwarded resolutions to the Minister of Finance. It would seem to me in view of the decision arrived at now, and in view of this amendment providing that the method of collection shall be the same as last year, that the minister has decided-shall I say?-to pull the chestnuts out of the fire for the wholesalers and manufacturers .of the country. That is, in my judgment, the real reason for the decision that has been arrived at.	'


James Alexander Robb: The first clause says:
Provided also that the taxes specified in this section shall not apply to sales or importations of,

Bread;-flour and oatmeal, when In packages weighing not less than forty-eight pounds each;
My interpretation of that is that all flour put up in packages of forty-eight pounds and over is exempt.


Henry Lumley Drayton: That has all been struck out.


James Alexander Robb: All flour is exempt?


Henry Lumley Drayton: Yes.


James Alexander Robb: There is another matter. I want a ruling as to where this tax will apply on lumber or any of these other articles. Will it apply at the point of shipment or at the point of delivery? I think it is important that the country should have a ruling on that at once, because it will make a material difference to the general trade of the country.


Henry Lumley Drayton: The same
practice will be followed as in fixing valuations of imports. It entirely depends on the invoices.


John Harold: Coming back to this matter I spoke of before, I could not hear the minister when he was making his statement regarding the fibre question, but I understand that he is in favour of correcting the injustice that is done under the regulations. There is one point I should like to have made clear, and that is: how will the importers stand with regard to any duties collected?


Henry Lumley Drayton: That will be quite all right.


Mr. CAHILL:: Following up what my hon. friend from Brant has said, I notice that he brought up this same question last year. He said (Hansard, June 16, 1920, page 3623) :
Mr. Harold: Is the Minister of Finance going to add to the list of exemptions the materials and supplies that enter into the manufacture of binder twine?
Sir Henry Drayton: As the fibre which is used in the manufacture of binder twine is the important item, and as we are not adding in any way to the burdens of agriculture, I move to add to the list of exemptions after the words "heating purposes" in the amendment to paragraph (d) of resolution 7, the words "fibre for use only in the manufacture of binder twine."
I would like to ask the minister what is the objection to taking that action now?


Henry Lumley Drayton: There is no objection at all. As I said, I am in sympathy with it, but there are other fibre twine essentials which we have been asked to consider practically on the same grounds, and we wanted to deal with the whole matter at the same time. I cheerfully give again to my hon. friend the undertaking I have already given, that this material the hon. gentleman wants exempted will be exempted by Order in Council, and the exemption made retroactive.


Mr. DECHENE:: Sub-section 4 exempts prayer books, hymn books, bibles, gospels,

parts of bibles. tracts, etc. Now, Catholics do not use bibles very extensively, but they do use missals and some other books of that kind. I do not see missals mentioned in this list. It may be stated that they are covered in the term "prayer books," but I think the matter should be put beyond any possibility of question.


Henry Lumley Drayton: There can be no room for question on that. Of course they are exempt. However, if my hon. friend desires any greater particularity, I do not object to adding the word "missal".


Joseph Bruno Aimé Miville Déchêne: I think the word
missal ought to be added.


Isaac Ellis Pedlow: I suggest adding, after the word "tracts," the words "and books", 

religious tracts and books.


Henry Lumley Drayton: That would be too broad.


[Stage Direction]
Resolution agreed to.
James Alexander Robb: Before the resolution is reported, I understood that the minister had promised the member for Shelburne and Queen's (Mr. Fielding), that he would take into consideration certain exemptions in regard to lumber for ships. I also pointed out that inasmuch as he has already made provision for the exemption of lumber going into certain ships, it was an unfair discrimination to tax lumber used in the construction of houses, barns and stables. The minister promised some consideration to that matter.


Henry Lumley Drayton: The matter
brought up by the member for Shelburne and Queen's is one which will require some little consideration, in order properly to define what is to be done. I undertook that the matter would be considered by Council at an early date, and I shall be pleased at the same time to consider the question raised by my hon. friend (Mr. Robb).


Joseph Bruno Aimé Miville Déchêne: Will the minister consider the advisability of including beads and crucifixes in the category of goods used in prayer, and exempting these articles? They are not used for commercial purposes, and I do not see what objection there could be to exempting them.


Henry Lumley Drayton: We will also consider that in Council.


Jean-Joseph Denis: I wish to go on record
as being opposed to a tax on lumber. Lumber is a natural product of the land, and this resolution clearly establishes the

principle that natural products of the land are to be exempt. The Minister of Finance will, no doubt, say that this is true, and that he is not taxing natural products; and we find that logs and round unmanufactured timber are not to be taxed. But I would point out that lumber, even after it is sawn, is a natural product of the land, and should not be taxed, because 95 per cent of the lumber used must be sawn before anything can be done with it. I see no reason therefore why lumber should be taxed any more than products of the mines or of the sea. We must not lose sight of the fact that in Canada to-day there are half a million people without homes, and the general try at the present time is for houses, and more houses. This Parliament has voted an appropriation and has passed a law in regard to a housing scheme. Every one admits that the housing problem in Canada to-day is a most acute one, and yet we are taxing the very essential that goes to the building of the people's homes. I do not see any distinction in the resolution between the large and small saw-mill, and as between the lumber used by the small settler or farmer, and lumber used in trade and lumber sawn or manufactured for export. There are in this country any number of small mills which saw lumber for the use of the settler and the farmer, and I do not think it is right to put a tax of 3 per cent on the lumber which the farmer takes to these mills to be sawn for domestic purposes. The poorer classes are in such great need of houses to-day that nothing should be done to hamper people in building homes. The new tax should not be imposed on lumber, which is one of the principle articles used in the building of houses. At present the building trade is almost stagnant throughout the country. It was in the same state last year and the year before. What is the reason? We have come to the point where labour has decreased in certain places, and now, I am informed on very good authority, building material has also decreased 20 per cent since last year. When these other materials are being decreased I do not think it is right for the Government to impose a tax that will be burdensome to those engaged in the building trade, especially for the reason that it will tend to still furather restrict the possibility of people of the poorer classes getitng dwellings at anything like a reasonable rate. Furthermore this tax on sawn lumber is really a tax on the export lumber trade, such as is not imposed in the case of any other commodity.


Mr. CALDER:: There is no tax on the export of lumber.


Jean-Joseph Denis: I understand that when a log has been sawn the owner of the mill is liable to a tax.


James Alexander Calder: The tax is paid when the lumber is sold for internal consumption not for export.


Jean-Joseph Denis: I am glad to hear that.


James Alexander Calder: At the end of the clause there is a provision that the tax shall not be payable on goods exported.


Jean-Joseph Denis: I have one or two observations to make with regard to the sales tax. Such a tax imposed on the poor as well as on the rich is not just to the former. A sales tax of three or four per cent means practically nothing to a rich man, but such a tax on the commodities used by the poor is a very heavy burden. For that reason I am not in favour of it. I notice that in the United States Senate Senator Smoot has introduced a Bill providing for a sales tax of 1 per cent which has evoked much condemnation. Now, if a sales tax of 1 per cent in the United States is regarded as bearing heavily on the poor, what must be the effect of the imposition of a sales tax of 3 or 4 per cent in this country?


Joseph Bruno Aimé Miville Déchêne: I notice there is a provision that the excise taxes specified in the section "shall not be payable on goods exported, or on sales of goods made to the order of each individual customer by a business which sells exclusively by retail." How would that operate in a case of this kind? Take a stove manufacturer who sells goods by retail all over the country. A jobber comes to his shop and says "I want 100 stoves from you and I would like my name put on those stoves." Will there be a sales tax in the case of such an order as that?


James Alexander Calder: Such a transaction would be covered by the regulations that will be applied under this section. My hon. friend will notice the wording "by a business which sells exclusively by retail, under regulations by the Minister of Customs and Inland Revenue." Any practice of that kind would be stopped by the regulations because such is not the intention of the law. On the other hand I think the Minister of Finance has already given an illustration applicable to the case of a retail merchant. Where individuals go in and get suits of



[Stage Direction]
clothes individually, it is not intended that the tax should apply.
Section agreed to.
Resolutions reported, read a second time and concurred in.
Sir Henry Drayton moved for leave to introduce Bill No. 204 to amend the Special War Revenue Act, 1915.
James Alexander Robb: Is it made perfectly clear that this resolution has been passed as amended?


Georges Henri Boivin: Amendments to a resolution are never reported.


[Stage Direction]
Motion agreed to, and Bill read the first time.

[Stage Direction]
On motion of Right Hor.. C. J. Doherty (Minister of Justice) Bill No. 157 to amend the Juvenile Delinquents' Act was read the second time, and the House went into committee thereon-Mr. Boivin in the Chair.
On the title:
Mr. McKENZIE:: I wish to say to the Minister in connection with this Bill that there is one thing which I take exception to,-that it is to be brought into force by proclamation. This is a very inconvenient procedure and should be discouraged as much as possible. The proclamations appear in the Canada Gazette, which is read by about one-tenth of one per cent of our people, and even members of my own profession very often do not know when they read a statute that is to come into force by proclamation whether it is actually in force or not. I submit that any criminal law should come into force by the statute itself.


Charles Joseph Doherty: I agree on general principles with what my hon. friend said, but this is a special provision. It is not the Act itself that is to come in force on proclamation, but only one section, and that section has to do solely with the age at which, a person may be treated as a juvenile delinquent. It is not creating any new crime, it is merely providing that a larger class of boys and girls may be treated as juvenile delinquents. The special reason for taking this course is that it has been represented to us that our present reformatories-which are mostly provincial institutions-are not now prepared to take in this additional class as between the ages of 16 and 18, and that until proper ar-

rangements are made it might prove very detrimental to the younger children to be brought in contact with these older and possibly more hardened offenders. We made a similar amendment the other day to the Prisons and Reformatories' Act with the same provision. I quite recognize the force of the hon. gentleman's objection 'if this were a penal provision, but, as I have said, it applies only to a matter of procedure.
Bill reported, read the third time and passed.


CANADA EVIDENCE ACT AMENDMENT
[Stage Direction]
On motion of Right Hon. C. J. Doherty (Minister of Justice) Bill No. 156 to amend the Canada Evidence Act was read the second time, considered in committee, read the third time and passed.

[Stage Direction]
On motion of Right Hon. Arthur Meighen (Prime Minister) Bill No. 141, to amend the Statistics Act, was read the second time, and the House went into committee thereon.-Mr. Boivin in the Chair.
On section 1-schedules that may be sent post free.
Daniel Duncan McKenzie: I have had some complaints from the Health Department of Nova Scotia which I brought to the notice of the Health Department here, and, I think, the Post Office Department also. The reports sent to Ottawa by the Provincial Health Department were formerly sent free of postage, and I understand that under the law of last year that privilege has been done away with. If we provided under this Bill that these reports might be sent free of postage, I think it would meet the public view.


Arthur Meighen: The Act of last year
was intended to be a relief to the Post Office
Department from a great many encumbrances on its revenue. My thought was that it was intended that these health reports should not be exempt from paying postage. The matter affected by this Bill was also last year included in the list of that not exempted, as was, indeed, everything coming from Provincial Governments. A tremendous amount of revenue was lost and all manner of stuff was sent out that was wasted simply because it
6 p.m. went free. The whole subject was reviewed, and the matter was put, as we thought, on a business basis. The hon. gentleman may possibly be light

as to the health reports, but I fancy that it is a case of services rendered the province by the Federal Government, rather than service rendered by us to the province, and they should hardly object to paying postage on them. But here we have a case where service is rendered by the provinces to us, and I understand that is why the Minister of Trade and Commerce felt he could not continue the rule of having them pay postage. Anyway, if my hon. friend were right the change would have to be made by amendment to the Health Act.


[Stage Direction]
Section agreed to.
Bill reported, read the third time, and passed.

[Stage Direction]
On motion of Right Hon. Arthur Meighen (Prime Minister) Bill number 135, to amend the Ottawa Improvement Commission Act, 1919, was read the second time, considered in committee, reported, read the third time and passed.

[Stage Direction]
AMENDMENT	[DOT]

[Stage Direction]
On motion of Right Hon. Arthur Meighen (Prime Minister) Bill No. 159 to amend the Inspection and Sale Act (Hay and Straw Inspection) was read the second time, considered in committee, reported, read the third time, and passed.

[Stage Direction]
On motion of Right Hon. Arthur Meighen (Prime Minister) the House went into committee to consider the following resolution, Mr. Boivin in the Chair: [DOT]
Resolved, That it is expedient to repeal section three of the Oleomargarine Act, 1919, chapter 24 of the statutes of 1919 (second session) as amended by section one of chapter 30 of the statutes of 1920, and to provide in lieu thereof that notwithstanding anything contained in the Dairy Industry Act, 1914, chapter seven of the statutes of 1914, or in any other statute or law, the manufacture in and importation of oleomargarine into Canada, and the offering for sale, and the having in possession for sale of oleomargarine, shall be permitted.
James Alexander Robb: As representing an agricultural constituency, and having in mind the great reduction in the price of dairy products-butter and cheese-I can see no longer a necessity for the free admission of oleomargarine into this country. Formerly it was the policy of this country, for the benefit of the dairy industries, to keep
out oleomargarine. The producers of dairy foods recognized, during the war, that butter was very high, and serious objection was not raised then to the admission of oleomargarine. But it is well known that oleomargarine, on account of the way in which it is put up and its appearance, is often substituted and sold for butter. For that reason, the dairy interests of this country believe that the time has now arrived when they should oppose the admission of oleomargarine into Canada, and I will advise the Minister of Agriculture that when the Bill comes up for its second reading I will oppose it.


Jean-Joseph Denis: The hon. member for New Westminister (Mr. McQuarrie) was making a speech in favour of the protection of eggs in British Columbia. If he were here he would support me when I say that, when butter has gone down 20 cents a pound within a month or two, it is no time to allow the admission into this country of oleomargarine. For my part I wish to place myself on record as being opposed to the resolution.


Mr. LEGER:: In the past, a similar
resolution was before the House. I opposed it then, and to-day I am more opposed to this resolution, because the admission of oleomargarine into Canada will be hurtful to the dairy interests of our country. Until lately I did not know anything about oleomargarine, although I had heard a great deal about it. Lately I purchased some and tasted it. There is no flavour to it, and it is not a class of goods that should be used by anyone. On that account, and because of the inferiority of the goods I am opposed to the resolution.


Joseph Bruno Aimé Miville Déchêne: This afternoon we
have had a great deal of discussion in regard to many articles of food and this and that, and now the Government is asking that oleomargarine may be sold in this country. As my hon. friend (Mr. Denis) has said, the price of butter has dropped 20 cents per pound or more within the last month or so, with the prospect of a still further drop in price. When butter is selling at such a low figure, it is not necessary to allow oleomargarine to be sold in this country. That was alright during the war when butter was high and the export of butter was at the highest point. As the matter stands now, we exported very little butter during 1920, and our exports this spring have been pretty low. Our wholesale houses are filled to the roof with butter, and it would be very unwise at this time

to allow again the importation and sale of oleomargarine. I wish to place myself on record as being opposed to the resolution.


Arthur Meighen: I suggest that we have an understanding that the passing of this resolution in no way commits the House to passing the Bill. We are simply advancing the matter a stage.


[Stage Direction]
Resolution agreed to, on division, and concurred in.
Mr. MEIGHEN thereupon moved for leave to introduce Bill No. 205, to amend the Oleomargarine Act, 1919, founded on the resolution.
Motion agreed to, and Bill read the first time.

[Stage Direction]
On motion of Right Hon. Arthur Meighen (Prime Minister), the House went into committee to consider the following resolution, Mr. Boivin in the Chair:
Resolved, That it is expedient to bring in a measure to regulate the grading of Dairy Produce, and to provide,-
1.	That the Governor in Council may make regulations for the grading of dairy produce, that is to say, butter, cheese and other food products manufactured from milk intended for export; for the establishment or designation of grading stores; for the issuing of grader's certificates; for the special marking by manufacturers of packages of dairy produce intended to be graded; for the establishment of standards, definitions and grades for dairy prot duce; and, for the imposition of fees for the ' grading of dairy produce.
2.	That the Governor in Council may by regulation prescribe the time when any regulation made under the provisions of the proposed legislation shall come into operation, the particular kind or kinds of dairy produce to [DOT]which it shall apply, and the part or parts of Canada within which it shall be in force.
3.	That there may be appointed such dairy produce graders and other officers as may be deemed necessary for the carrying out of the provisions of the proposed legislation and of the regulations made thereunder.
4.	That the Governor in Council may by regulation provide for an appeal to the Dominion Dairy and Cold iStorage Commissioner, or his representative, from a decision of a Dairy Produce Grader as to the classification or grading of any particular lot of dairy produce.
5.	That penalties may be imposed for the violation of any provision of the proposed legislation or of any regulation made thereunder.
Jean-Joseph Denis: This resolution may be all right; but it is very wide and vague in its terms, and it should not be passed when, according to the rules, the committee is not supposed to sit. The committee is very slim, and there may be members who are not in the chamber at present, who would like to oppose the resolution.
[Mr. Dechene.J


Arthur Meighen: The resolution may be called "carried on division.'' There is this extra precaution in this case. The resolution has, of course, to be followed by a Bill, the same as the previous resolution; but this Bill would, I presume, have to go before the Committee on Agriculture, and there, as well as in the House, and in committee again, it will be threshed out, so that we are taking no risks.
1 Mr. ROBB: If as suggested by the Prime Minister, the resolution is passed on division, this time I would be compelled to vote with the Prime Minister. This matter has previously been before the Committee on Agriculture and it has been pretty well threshed out in that committee. While objection was taken to certain features of it, I think the Minister ol Agriculture and the Dairy Commissionei satisfied the Committee on Agriculture that nothing would be done that would be of any injury, and that this measure would be of advantage to the dairy industry As a representative of a dairying constituency, I am not opposed to the introduction of this measure, but I will reserve the right to determine my attitude when I see the Bill.


Daniel Duncan McKenzie: By passing this resolution, we commit ourselves, I suppose, to the principle of it. Is it the intention to make any new appointments or to impose any further burdens upon the country by reason of this legislation?


Arthur Meighen: If any new appointments are necessary, they will be in the nature of assistance to the country instead of burdens, but I must confess that I do not know.


Daniel Duncan McKenzie: That is the trouble of rushing through the business of the department. The minister (Mr. Tolmie) was here a few minutes ago, and he certainly is within call somewhere. He is not here now, although he should be here in order to give explanations.


[Stage Direction]
Resolution agreed to, on division.
Mr. Meighen thereupon moved for leave to introduce Bill No. 206, to regulate the grading of dairy produce, founded on the resolution.
Motion agreed to, and Bill read the first time.
On t-he motion of Right Hon. Mr. Meighen the House adjourned at 6.18 p.m.

Monday, May 23, 1921.