PRIVATE BILLS INTRODUCED.

[Stage Direction]
Bill No. 72, for the relief of William Ewart New.-Mr. R. B. Bennett.
Bill No. 73, for the relief of Helene Suzette Baxter Douglas.-Mr. Fripp.

[Stage Direction]
[Questions answered orally are indicated by an asterisk.]

Mr. CARVELL:: I was paired with the
hon. member for York, N.B. (Mr. McLeod). Had I voted, I should have voted for the amendment.


Mr. DOUGLAS:: I was paired .with the
hon. member for Yale-Cariboo (Mr. Burrell). Had I voted, I should have voted for the amendment.


Mr. McCOIG:: I was paired with the
hon. member for West Elgin (Mr. Crothers). Had I voted, I should have voted for the amendment.


Mr. G. C. WILSON:: I was paired with the hon. member for Laval (Mr. C. A. Wilson). Had I voted, I should have voted against the amendment.


Sir WILFRID LAURIER:: 
Mr. CODERRE:: 
N T EY.-EMPLOYEES AT CERTAIN STATIONS.
Mr. E. LAPOINTE:: 1.	What are the names of all persons employed by the National Transcontinental railway at the following stations: Escourt, St. BleuthSre, Pelletier, Picard, Lapointe, Lipp6e, Hawkins and Holliday?
2.	What is tlhe salary of each of such persons?
3.	What is the nature of their respective duties?
4.	Who recommended the said persons?


Mr. COCHRANE:: 
APPOINTMENT OF PACKERS AND SORTERS.
Mr. CARVELL:: 1.	How many appointments have been made to the Civil Service as .packers and sorters subsequent to October 12, 1912?
2.	What proportion of these were males and what proportion females?
3.	How many appointments have been made to the Civil Service as packers and sorters prior to October 12, 1912?
4.	"What proportion of these were males and what proportion females?


Mr. J. D. REID:: I wish to move that this question be changed to an order for a return. It will take some time to have the information brought down, for the reason that question No. 3 as it reads will go back to Confederation. I do not think that was the intention. I think the hon. gentleman should name a period from, say, 1896 to 1912. However, if die wishes to go further back we will get the information, but it will take some time.
Question stands as order for a return.


CHARGE OF CORRUPTION.
Mr. PAPINEAU:: 1.	Is the Government aware of the publication of a letter from Mr. Henri Bourassa, director of Le Devoir newspaper, in the issue of

that paper of the 31st December, 1914, and containing the following declaration :	.
" Reply of the Director of the Devoir.
''You have no faint idea of the amount and nature of graft, corruption and debauchery connected with that contingent, destined to go and fight the battles of honour and liberty. Had we published one-twentieth portion of what came to us from most reliable sources of information, we could have been hanged and quartered many days ago. Whether this will ever come out in full light is doubtful. The Tory grafters were careful enough to take some of their Liberal opponents in partnership, so that nothing would transpire in Parliament"?
2.	Has the Government considered it necessary to take steps to ascertain the exactness of this declaration?
3.	If it has had no knowledge of It before this question was asked, does the Government consider the declarations made in the above quoted letter sufficiently grave to engage its attention?


Sir ROBERT BORDEN:: 1.	No.
2 and 3. Wherever allegations or charges of a definite character' have been brought to the attention of the Prime Minister, he has instructed the Department of Justice to make any necessary investigation, and for that purpose to utilize _all means at the disposal of the Government. The Department of Justice has been further authorized and directed in such cases to prosecute to the utmost limit of the law all persons who appear upon reasonable information to have been concerned in an attempt to defraud

the Government. If any information of a sufficiently definite character is brought to the attention of the Government by the gentleman mentioned, the same course will be pursued.


WAR SUPPLIES-AUTOMOBILE TIRES.
Mr. TURRIFF:: 1.	How many sets of tires were purchased by the Militia Department from the Dunlop Tire Company for the first contingent?
2.	What price per set was paid?
3.	How many sets were purchased from the same company for the second contingent?
4.	What price per set was paid for those supplied to the second contingent?


Major General HUGHES:: 1 and 2. None.
3 and 4. 120 sets of 38 inch x 5 inch single front and dual rear solid demountable truck tires, complete, with Society of Automobile Engineers steel rims, at $247 per set; 60 sets of 36 inch x 5 inch single front and single rear, solid demountable truck tires, complete, with Society of Automobile Engineers steel rims, at $169.24 per set.


WHARF AT L'ASSOMPTION, QUE.
Mr. SEGUIN:: 1.	Has the Government completely abandoned the project of building a wharf for the town of l'Assomption?
2.	Is the Government aware that the nonexecution of that project -is said to be the cause of considerable damage for that locality and for all the neighbourhood?
3.	Is the Government aware that a considerable quantity of wood, intended for that construction, paid for by the Department of Public Works, is left on the ground and is becoming deteriorated and will soon be a total loss for the department?


Mr. ROGERS:: 1.	No.
2.	No.
3.	The Government is aware that some timber was purchased in September, 1911.


ARMOURY AT PICTOU ONTARIO.
Mr. PROULX:: 1.	Who was employed by the Government as clerk of works in the construction of the armoury at the town of Picton, county of Prince Edward, in 1913 and 1914?
2.	(a) What salary was paid to the clerk of works by the Government, and (b) is he still in the pay of the Government? (e) If so, at what salary and for what purpose?


Major General HUGHES:: 1.	R. G. K. Hepburn.
2.	(a) $4 per working day. (b) No. (c) Answered by (b).


GEORGIAN BAY CANAL COMMISSION.
Mr. PROULX:: 1.	Who has been appointed by the Government as secretary of the Georgian Bay Canal Commission?
2.	(a) When was such secretary appointed, and (b) what Is his salary?


Mr. ROGERS:: 1.	J. de C. Hepburn.
2.	(a) Appointed on 1st April, 1914; (b) salary authorized by Order in Council of 24th February, 1914, is $300 a month.


WAR SUPPLIES-J. WESLEY ALLISON.
Mr. DEMERS:: 1.	Was J. Wesley Allison at any time authorized to purchase war supplies of any kind on behalf of the Dominion of Canada?
2.	If so, on what conditions?
3.	Is he still so authorized?


Major General HUGHES:: 1.	All contracts were made directly by the Department of Militia and Defence. Mr. Allison was asked to procure and did procure information for the department as to sources from which war supplies could be purchased and as to the prices at which they could be procured. For this purpose he secured and placed at the disposal of the department valuable information.
2.	There were no special conditions. The minister asked Mr. Allison to procure the information as speedily and quietly as possible, as there was an apprehension that exportation to Canada of war supplies might be prohibited. Mr. Allison was offered remuneration for his services, but declined to accept either remuneration or payment of his expenses.
3.	Authority to purchase war supplies is conferred only by Order in Council under the War Appropriation Act, 1914. No authority, special or general, has been conferred upon any person other than the permanent officers of the Department of Militia and Defence. When the Minister of Militia deems it necessary, he obtains information as to sources from which war supplies can be procured and as to the prices thereof from any persons, including Mr. Allison, whom he may deem competent to give such information.


WAR SUPPLIES-MOTOR TRUCKS.
Mr. PARDEE:: 1.	(a) Were the bodies for the 150 motor trucks recently purchased by the Militia Department from the Kelly Springfield Motor Truck Company of Springfield, Ohio, made in Canada? (b) If so, by whom and at what price?
2.	Is it true that these bodies do not fit the trucks and that new bodies or extensive alterations will have to be made? If so, what is the estimated cost of making the necessary alterations or new bodies?
3.	(a) Is it true that the wheels of the trucks delivered to the department were not bored to equip the tires thereto, and that the work of boring the wheels is now being done in Canada

at an additional expense? If so, what additional expense will be involved?


Major General HUGHES:: 1.	(a) Yes. 144 bodies were ordered on December 16, while minister was absent in maritime provinces; balance of 6 are to be fitted with workshop bodies, (b) Massey Harris Co. Ltd., Toronto, 36 at $168; McLaughlin Carriage Co., Oshawa, 36 at $168; Oxford Motor Co., Oshawa, 36 at $168.
2.	The bodies ordered and made did not fit the trucks, they being for a two ton truck instead of for a three ton truck. New three ton bodies are being made according to War Office regulations, which provide seating capacity for four men with adequate weather protection, with rifle racks, with box for men's equipment, etc., all made to one specification, costing one hundred and fifty dollars ($150) each. The two ton bodies, however, are being sold at what they cost, so there will be no loss.
3.	(a) Yes. (b) The work is now being done in Canada at a cost of one dollar per tire.


WAR SUPPLIES- HORSES.
Mr. TOBIN:: 1.	Were Colonel Smart and Colonel PichS authorized by the Government to purchase horses in the province of Quebec?
2.	If so, how many did they purchase?
3.	Are they still in the employ of the Government in such capacity?
4.	If not, on whose recommendation and why were their services dispensed with?


Major General HUGHES:: 1.	Yes.
2: 659 horses.
3 and 4. The number of horses which they were engaged to purchase has been supplied, and their services were not further required. Colonel Smart has since been appointed Brigadier General, and is unable to perform further duties of this character. Colonel Piche is acting principal veterinary officer of Montreal division on active service.


Mr. BUCHANAN:: 1.	Have the Prime Minister and the Minister
3.
Dr. J. W. Robertson.. ..
Rev. Geo. Bryce	
Hon. J. N. Armstrong ..
D.	Forsyth	
James Simpson	
G. M. Murray	
G. de Serres	
E.	Belanger	
Thos. Bengough, secretary
of Militia received a memorial from the United Farmers of Alberta, regarding the purchase of horses for war purposes?
2.	Is it intended to take any action on the suggestions made in the memorial?
3.	If so, in what respects?


Sir ROBERT BORDEN:: 1.	The Prime Minister and the Minister of Militia have received the memorial alluded to.
2.	The Minister of Militia has informed the Prime Minister that in general terms he agrees with everything set forth in the memorial and that he has so written to Mr. Woodbridge, the secretary of the United Farmers of Alberta. In respect of purchase of horses certain arrangements of a confidential character heretofore made by the British and French Governments have to be taken into consideration.
3.	The Minister of Militia agrees in general respects with the memorial and is prepared to carry out the suggestions in all important respects. As to certain minor details some modifications of the suggestions might be required. The suggestions contained in the memorial are regarded as helpful and the Minister of Militia has expressed bis thanks and appreciation to the secretary of the United Farmers of Alberta.


COMMISSION ON TECHNICAL EDUCATION.
Mr. WEBSTER:: 1.	What were the fees per day for each of the members of the Royal Commission on Industrial Training and Technical Education?
2.	What was the total amount of fees received by each member of the commission?
3.	What was the total expense of each member of the commission?


Mr. CROTHERS:: 1.	Members of commission, $16 per day and travelling expenses; secretary, $10 per day and living and travelling expenses.*
2.	Total fees:	Dr. J. W. Robertson,
$14,688; Rev. Geo. Bryce, $7,312; Hon. J. N. Armstrong, $6,208; D. Forsyth, $7,712; James Simpson, $7,456; G. M. Murray, $3,120; G. de Serres, $1,360; E. Belanger, $3,952; Thos. Bengough, secretary, $12,614.51.
Fees.	Expenses,	Total.	$14,688	00	$2,531	04	$17,219	047,312	00	1,593	21	8,905	216,208,	00	1,122	33	7,330	337,712,	,00	1,329	68	9,041	687,456	00	1,284	23	8,740	233,120	00	1,152	96	4,272	961,360	00	255	47	1,615	473,952	00	1,060	25	5,012	2512,614	51	4,403	36	17,017	87

* In addition, the secretary received an additional allowance of $5 per day for reporting evidence given before the commission.



INTERCOLONIAL, RAILWAY-COAL SUPPLY.

['I will attend to the matter.']
Francis Cochrane: 1 and 2. Bituminous coal: Colonial Coal Co., 32,745 gross tons; Cape Breton Coal, Iron and Railway Co., 19,913 gross tons; Inverness Railway and Coal Co., 32,142 gross tons; Acadia Coal Co., 59,143 gross tons; Intercolonial Coal Mining Co., Ltd., 69,137 gross tons; Elwin Long, 652 gross tons; Dominion Coal Co., 179,858 gross tons; Nova Scotia Steel and Coal Co., 81,551 gross tons; Maritime Coal, Railway and Power Co., 89,689 gross tons; Minudie Coal Co., 45,618 gross tons; Rothwell Coal Co., 4,348 gross tons; G. H. King, 3,744 gross tons; Northfield Coal Co., 3,100 gross tons; Minto Coal Co., 810 gross tons; Harvey Welton, 278 gross tons; Dr. M. F. Keith,
4,166 gross tons; Grand Trunk Railway, 13,915 net tons. Anthracite coal:	J. S.
Gibbon & Co., 665.40 net tons; The Archer Co., Ltd., 34.85 net tons.
3.	Not yet determined.



Mr. CARROLL:: 1.	Who are the registrars of alien enemies for the riding of South Cape Breton, N.S.?
2.	What is the salary paid to each?
3.	What assistants have they got, and what are their names and salaries?
4.	What are the names of the interpreters in connection with the work, and what are their salaries?


Mr. CASGRAIN (for Mr. Doherty):: 1.	H. C. Moseley.
2.	$200 per month.
3.	D. Nicholson, $100 per month; A. D.
Gillis, $100 per month; B. Morrison, $30 per month.	)
4.	H. Benjamin, $75 per month.
IMMIGRATION FROM 1900 to 1914.


Mr. W. M. MARTIN:: 1.	How many immigrants located in Canada in each of the years from 1900 to 1914, inclusive?
2.	How many of such immigrants located in each of the provinces of Canada in each of said years?


Mr. ROCHE:: 1 and 2:
Fiscal Period.	Maritime Provinces.	Quebec.	Ontario.	Manitoba.1900 (first 6 months)	719	2,881	2,243	10,2681900-1901	2,144	10,216	6,208	11,2541901-1902	2,312	8,817	9,798	17,4221902-1903	5,821	17,040	14,854 ,	39,5351903-1904	5,448	20,222	21,266	34,9111904-1905	4,128	23,666	35,811	35,3871905 1900	6,381	25,212	52,746	35,6481906-1907 (9 months)	6,510	18,319	32,054	20,2731907 1908	10,360	44,157	75,133	39,7891908 1909	6,517	19,733	29,265	19,7021909 1910	10,644	28,524	46,129	21,0491910-1911	13,236	42,914	80,035	34,6531911 1912.. 	15,973	50,602	100,227	43,4771912 1913	19,S0G	64,835	122,798	43,8131913-1914	16,730	80,368	123,792	41,6401914-1915 (10 months)	10,206	29,718	42,759	12,681Fiscal Period.	Saskatche- wan.	Alberta.	British Columbia.	Not shown:	Total Immigration to Canada.1900 (first 6 months)	6,177	1,338	268	23,8951900-1901	14,160	2,600	2,567	49,1491901-1902	22,199	3,483	3,348	67,3791902-1903 	43,898	5,378	1,838	128,3641903-1904 	40,397 '	6,994	1,093	130,3311904-1905	39,289	6,008	1,977	146,2661905-1906	28,728	26,177	12,406	1,766	189,0641906-1907 (9 months)	15,307	17,559	13,650	395	124,6671907-1908	30,590	31,477	30,768	195	262,4691908-1909	22,146	27,651	21,862	32	146,9081909-1910 	29,218	42,509	30,721	208,7941910-1911	40,763	44,782	oil 701	311,0841911-1912	46,158	45,957	51^843	354,2371912-1913	45,147	48,073	57^960	402,4321913-1914	40^999	43; 741	37^608	384,8781914-1915 (10 months)	14;835	16^930	9;661	136,790


HUDSON BAY RAILWAY.
Mr. W. M. MARTIN:: #
1.	What will be the total mileage of the Hudson Bay railway when completed?
2.	How many miles of the railway have been graded?
3.	How many miles of steel have been laid?
4.	What is the total cost to date?
5.	What is the total estimated cost of the completed railway?
6.	What is the estimated cost of the proposed harbour inprovements?
7.	How much has been spent on harbour improvements to date?


Mr. COCHRANE:: 1.	424 miles.
2.	First 250 miles nearly completed, following 50 miles well advanced.
3.	214 miles.
4.	$7,647,197.41.
5.	$16,000,000.
6.	$10,000,000, less possible credits of $1,000,000 for steamships, plant, etc.
7.	$3,480,277.08; includes plant, steamships, wireless stations, etc.


LEASEHOLDERS OP COAL RIGHTS.
Mr. MACNUTT :: 1.	Who are the owners or leaseholders of the coal rights in sections 6. 7, IS, 19, 30, 31, township 10, range 4, west of the 5th meridian; also sections 6, 7, 18, 19, 30 and 31, township 11, range 4, west of the 5th meridian?
2.	On what date did the present owners secure their rights?
u. What payments have been made in connection with each half section?
4.	What amounts are due in connection with each half section?


Mr. ROCHE:: 1.	Townships 10 and 11, range 4, west of the 5th meridian, would not appear to have been subdivided into sections, so that it is not possible to give ithe information asked for in respect of each half section, but the following coal mining locations which appear to include sections 6,

7, 18, 19, 30 and 31, in township 10, range 4, and sections 6, 7, 18, 19, 30 and 31, township 11, range 4, west of the 5th meridian, in whole or in part, have been duly staked out and coal mining leases issued therefor:
Lease No. 332; lessee, Thomas Thomson. Approximate description: Sections 30 and 31, township 10, range 4, and sections 6 and 7, township 11, range 4, west of the 5th meridian.
Lease No. 333; leasee, W. T. Eddy. Approximate description: Sections 6, 7, 18 and 19, township 10, range 4, west of the 5th meridian.
Lease No. 510; leasee, Walter Gardner. Approximate description: West halves of sections 18, 19, 30 and 31, township 11, range 4, and the east halves of sections 13, 24, 25 and 36, township 11, range 5, west of the 5th meridian.
2.	Lease 332, issued 24th June, 1910; lease 333, issued 24th June, 1910; lease 510, issued 8ith May, 1911.
3.	The following rentals have been paid in connection with the above leases: Lease 332, rental paid, $5,120; lease 333, rental paid, $5,120; lease 510, rental paid, $2,560.
4.	Amounts due for Tental are:	Lease
332, $7,680; lease 333, $7,680; lease 510, $7,680; with interest at the rate of five per cent per annum on the unpaid rentals from the due date to the date of payment.


BRIDGE OVER RESTIGOUCHE RIVER.
Mr. MARCIL:: 1.	Has a request been received for the construction of a vehicular and foot-passenger bridge over the Restigouche river at Campbell-ten, N.B., and from whom?
2.	Has any action been taken? If so, what has been done?


Mr. ROGERS:: 1.	Yes, petitions were received from: the Board of Trade, Campellton, Restigouche

county; municipality of Campbellton, Resfi-goucQie county; municipality of Mann, Bon-aventure county; municipality of New Carlisle, Bonaventure county; municipality of Hamilton, Bonaventure county; municipality of Port Daniel West, Bonaventure county; municipality of Nouvelle and Shool-bred (southwest part), Bonaventure county; municipality of Maria, Bonaventure county; municipality of New Richmond, Bonaventure county; municipality of Matapedia, Bonaventure county; municipality of St. Andre de Restigouche, Bonaventure county; municipality of Hamilton, Bonaventure county; municipality of Restigouche East, Bonaventure county; municipality of St. Jean l'Evangeliste, Bonaventure county; municipality of St. Omer, Bonaventure county; municipality of Restigouche East, Bonaventure county; municipality of Pa* pebiac, Bonaventure county; municipality of New Richmond, Bonaventure county; municipality of Port Daniel East, Bonaventure county; municipality of Mussely-ville, Bonaventure county; municipality of Hope, Bonaventure county; municipality of Maria, Bonaventure county; municipality of Campbellton, Restigouche county, N.B.; municipality of the parish of Durham, Restigouche county; municipality of the parish of Addington, Restigouche county; municipality of the parish of Durham, Restigouche county; municipality of the parish of Balmoral, Restigouche county; municipality of the parish of Coleborne, Restigouche county; municipality of Dalhousie, Restigouche county, N.B.; municipality of the parish of Dalhousie, Restigouche county.
2.	The District Engineer has been ordered to make a complete survey and report.
22ND FRENCH CANADIAN BATTALION.


Mr. MARCIL:: 1.	Has the Fench Canadian regiment stationed at St. Johns, Quebec, been transferred lately, and where is it now stationed?
2.	What was the purpose of such a change, and what advantage is there in the new location over St. Johns, Quebec?
3.	What is the numerical strength of this corps, and who are its chief officers?
4.	Is this corps now up to its full strength?
5.	Who are the chief medical officers selected for this corps?
G. Has the entire medical staff been selected, and what is its total?


Major General HUGHES:: 1. Yes. The 22nd (French Canadian) Battalion stationed at St. Jean, P.Q., was transferred, on the 12th March, from St.
Jean to Amherst, N.S., where it is now stationed.
2.	The accommodation at St. Jean Barracks was inadequate to house a full regiment of infantry, and, at the request of Colonel Gaudet, the Officer Commanding the regiment, the regiment was transferred to Amherst, N.S.
It is the intention to replace the 22nd Regiment at St. Jean, P.Q., by a smaller unit of artillery.
3.	The 22nd Battalion left St. Jean, P.Q.,
with a total strength of 36 officers and 1,026 other ranks. The chief officers are as follows:	Lt.-Colonel F. M. Gaudet,
R.L.; Majors, two; Adjutant, Captain L. J. D. Gingras, 61st Regiment; Officers Commanding Companies, four-Major C. T. deLanaudiere, 83rd Regiment; Major J. A. Filiatrault, 65th Regiment;* Captain A. E. Dubuc, C. of G.; Captain J. V. Roy.
The authorized war establishment of this unit, including details, left at the base, is: 36 officers and 1,097 other ranks.
4.	No. Seventy-one men are required to complete the battalion.
5.	Lieut. Camille Laviolette, A.M.C.
6.	Yes. Six-one officer and five Army Medical Corps men for water duties, one of whom is a corporal.


UNOPPOSED MOTIONS FOR PAPERS.
[Stage Direction]
Mr. E. Lapointe:	For a copy of all reports,
correspondence and other communications between the Department of Customs and Auguste Desjardins, of St. Denis de Kamouraska, since his appointment as a preventive officer of that department.
Mr. E. Lapointe:	For a copy of all reports,
correspondence and other communications between the Department of Inland Revenue and P. Courcy, of St. Pacome, since his appointment as preventive officer in the said department.
Mr. E. Lapointe:	For a copy of all documents, letters, messages, correspondence, petitions, recommendations, reports, etc., connected with the building of a station for the National Transcontinental railway at Armagh, county of Bellechasse, also regarding the different changes that were made regarding the site of the said station, and of all documents connected with the purchase of the different properties which the Railway Department and the Transcontinental Commission acquired for purposes of the said station.
Mr. A. K. Maclean: For a copy of all petitions, letters, documents, etc., between persons in the province of Nova Scotia and the Department of Trade and Commerce since August 1, last, with regard to Atlantic ocean freight rates on subsidized steamers or otherwise.
Mr. A. K. Maclean: For a copy of all correspondence, letters, Orders in Council, agreements, etc., in'reference *o the leasing or
[Stage Direction]
transfer of the Windsor branch of the Intercolonial railway to the Canadian Pacific railway.
Mr. Pugsley: For a copy of all correspondence between the Chinese Consulate at Vancouver, B. C., and the Minister of the Interior, regarding recent Chinese arrivals in this country being allowed a refund of the head tax on their leaving British Columbia to return to their homes in China.
Mr. J. J. Hughes:	For a copy of all correspondence and reports relating to the purchase of 25,000 shovels of special pattern, mentioned in Order in Council P.C. 2302, dated 4th September, 1914, on page 38 of memoranda respecting work of the Department of Militia and Defence, and also relating to any further purchases of such shovels.
Mr. Turgeon: For a copy of the pay-sheet for the month of October, 1914, in connection with repairs to the breakwater at Shippigan Gully, Gloucester county, N.B.

[Stage Direction]
On the Orders of the Day being called:
Mr. W. F. MACLEAN:: I wish to give a word of explanation in regard to Bill No. 30, which stands in my name, and for which a special hearing has been set for to-morrow in the Railway Committee. Inasmuch as the Minister of. Railways has stated that he intends next session to bring in his own measure amending the Railway Act, and as my amendment is of the same nature, and as in consequence it would be useless, as I intended, to ask some people to appear before the Railway Committee to-morrow, 1 shall withdraw this Bill and save the people the necessity of coming down here.


SEED GRAIN FOR WESTERN FARMERS.
William Melville Martin: I call the attention of the Minister of the Interior to the fact that information has come to me from several sources in the West to the effect that representatives of the Government have written letters in different cases stating that applications for seed grain would not be received after the 20th day of February. I wish to ask the minister whether the officials of the department have been instructed to accept no further applications for seed grain.


William Roche: The hon. gentleman will
see that it was necessary to have some date fixed beyond which applications would not be received, or otherwise we would not know what quantity of seed grain to purchase, and to clean, bag, and ship. I understand that applications from the drouth area were limited to the 31st of January; in the immediate area similarly situated the date was fixed as the 20th of February and outside

that in other districts a longer time was given, namely, to the 10th of March. No application will be received after the 10th of March.


SALE OF UNDERSIZED LOBSTERS.
Mr. PUGSLEY:: I desire to get some information from the Minister of Marine and Fisheries on a question of some importance. I have received information from St. John that lobsters of very diminutive size caught in Nova Scotia are being placed upon the market there. Some of these are as small as 31 inches. By regulation, the fishermen of St. John county are limited in the taking of lobsters to those of 10J inches, I think my hon. friend will know whether I am right or not. A sample of one of these small lobsters offered for sale was sent me so that I could show it to the minister. I desire to ask if his attention has been called to the matter. It is certainly very objectionable that lobsters of such small size should be allowed to be caught. He will recognize how important this matter is.


Mr. HAZEN:: I will attend to the matter.



WAYS AND MEANS-THE TARIFF.

[Stage Direction]
The House again in Committee of Ways and Means, Mr. Sevigny in the Chair.
Hon. W. T. WHITE (Minister of Finance):: I desire, with the consent of the Committee, to proceed with the consideration of a resolution, which I shall introduce, relative to the tariff. The House will recollect that in the Budget speech I gave notice of two resolutions, one affecting special taxation which the Government proposed and the other relating to certain tariff increases under the proposed War Revenue Act. It will be more convenient for me, if the committee is agreeable, to proceed first with the consideration of the resolution which I shall present dealing with the increases in the tariff. We are considering certain modifications in the phraseology, and slightly in the substance, of the resolutions relating to special taxation. I have not at present- but expect to have later in the afternoon-copies of the resolution as modified.
Now, with regard to the resolution relating to the tariff changes, I desire to say that there are certain modifications which I have to propose, one new item and a small number of additions to the list of exemptions. At the request of the Government of Newfoundland we propose to place upon the free list wild edible berries. I

have to propose also certain additions to tl>e list of exemptions as follows:	At the request of the Government of the sister colony of Jamiaea, I propose that bananas shall he exempted from the increase in tariff under the War Revenue Act.


Sir WILFRID LAURIER:: That is au
excellent move.


William Thomas White: My right hon. friend knows that excellent moves are characteristic of me. Why should he express surprise at one?


Wilfrid Laurier: Yet I'do. But better late than never. That is all right.


Mr. MARCIL:: Does the item " edible berries " include blueberries, which grow in large quantities in the province of Quebec ?


William Thomas White: These berries are known as partridge berries, and grow on the rocks of Newfoundland.
I have added to the list of exemptions, silk in the gum or spun silk imported to be used in the manufacture of woven labels. Woven labels manufactured of silk come under the operation of schedule C of the French treaty, and consequently are not subject to the increased duties of 71 and 5 per cent proposed in the Budget. Silk in the gum or ispun silk imported to be used in the manufacture of woven labels, therefore, will also be exempted from the rates in question.
I am placing manuscripts also upon the free list, at the request of the Customs Department, who istate that it is almost impossible to fix a valuation upon which the rates of duty could be imposed.
There are two other important items: Coffee and coffee extracts. Hon. gentlemen will recall that in the August 'session we increased the duty upon coffee and upon its products, including coffee extract. From a careful consideration of the matter -since bringing down the Budget, I have reached the conclusion that to add a special war tax to the 'special tax imposed at the August session upon coffee would probably have a not inconsiderable effect upon the trade, especially in view of the fact that tea has been left upon the free list. Tea is largely used in eastern Canada and coffee in western Canada; both, of course, are largely used throughout the Dominion.
Then there is platinum. Platinum is about three times as valuable as gold. It is used for laboratory and other purposes, and the tax of 71 and 5 per cent would be exceedingly heavy if placed upon it. We
propose, therefore, to include platinum in the list of exemptions.
I come now to the item of fertilizers. Since the Budget was brought down, requests have reached us from the Agriculture Department, in connection with its campaign for increased production throughout Canada, to consider favourably the placing of fertilizers- in the list of exemptions. Similar requests have been made by hon. gentlemen on both sides of the House. The amount involved is not large; apart from	this, it is, of course,
a pleasure	to the 'Government to
further in any possible way the propaganda of the Agricultural Department which has for its object the increase of production throughout Canada. I propose, therefore, that items 662 and 663, which cover manufactured and unmanufactured fertilizers, be included in the list of exemptions, and in addition to that we include also acid phosphate of lime, sulphate of ammonia, nitrate of soda, muriate and sulphate of potash, when imported to be used for fertilizing purposes. I think that these three items cover all manufactured and unmanufactured articles known as fertilizers or the raw material which enters into their manufacture.


Mr. A. K. MACLEAN:: Will there be remissions of duties paid since February 12?


William Thomas White: This provision will relate back to the date of my Budget speech, from which date the duties were collected.


William Pugsley: Do we understand that duties paid under the original provision will be refunded? I have had many letters on the subject from persons who have paid these duties.


William Thomas White: There will be a refund,
because this provision will relate back to February 12, the date when the duties become operative.


William Pugsley: Should there not be some provision to cover that?


William Thomas White: I think it is amply covered in the resolution which I have prepared, and which I shall present in due course.
There is one other item which was drawn to my attention-I speak from memory, but am satisfied that I am correct-by the Minister of Agriculture for the province of Ontario. It is that of cotton seed cake and cotton seed cake meal used for feeding purposes. We propose to include that in the list of exemptions.


Mr. NESBITT:: That is what is commonly known as cotton seed meal, is it not?


William Thomas White: That is my understanding of it. Their technical designations are as I have given them.


Edward Walter Nesbitt: They were so designated in the last tariff, but this product is called cotton seed meal by the general public.


William Thomas White: I believe that is correct. Another item which we propose to exempt is No. 45, milk foods used by hospitals and for the feeding of infants. When I speak of exemptions, the House will understand that I mean exemptions from the operation of this war tax of 7J and 5 per cent.
The war tax upon spirits is a matter of some importance. This duty was formerly specific; under the proposals of the recent Budget importations of spirits become subject to the 7} and 5 per cent rates. I pointed out the other day that we were imposing a duty of 5 per cent and 7J per cent on imported spirits and that the distiller of spirits of domestic manufacture would have an increased cost in his manufacture by reason of the fact that his coal and his corn and machinery and other materials would be subject to a special taxation of 7J per cent and 5 per cent. Since the Budget speech it has been brought to my attention that the duties under the War Revenue Act would apply to the fair selling value of spirits at the place from which they were imported and that included in that fair selling value is the excise duty levied by the foreign government. We propose that, so far as the imposition of these customs taxes is concerned, these excise duties shall be disregarded in estimating the value of goods for the purpose of our amendment to the customs tariff of 1907. I hope I have made myself clear. Under the Customs Act at present, spirits are imported into Canada and an ad valorem duty is imposed, that ad valorem duty would take effect upon the fair selling value of the spirits, say in Great Britain or in Holland or in any other country, including in that, the excise duties imposed by the Governments of those countries. I propose that that should be disregarded and that the 7J per cent or the 5 per cent, as the case may be, should be imposed upon the selling value, disregarding the excise duty which I have mentioned.


Alexander Kenneth Maclean: The excise imposed in the country of origin would be a part of the price there, would it not?


William Thomas White: Precisely.


Frank Broadstreet Carvell: You exclude the foreign excise?


William Thomas White: Certainly. The reason we are doing that is that it is important that if we are to be fair in the imposition of these taxes, while we should see that the home producer, that is to say, the distiller, has a tax imposed, so to speak, to protect him- I am not using that in the fiscal sense-as against the added cost of his production, the cost of his production would be compared with the cost of the production abroad, and the foreign excise should therefore be disregarded. We think that the proposal we are now making will be fair to these importers of spirits and fair also to the distiller here.


Mr. LAW:: Under the new arrangement, is the distiller of Canada not given more protection than he had before the Budget was brought down?


William Thomas White: Than what I am now proposing? No, I do not think so. As the Budget was brought down the proposals would have imposed a tax of 7J per cent or 5 per cent, as the case might be, on the price of the spirits in the country of origin from which they were imported. Included in that price, in fact the major part of that price, is the excise charged by the Government in the country of origin. As I brought down my proposals, the 7J per cent and the 5 per cent would be levied upon, let us say, $2 as the price of a certain amount of liquor, including foreign excise; whereas now I am excluding foreign excise and the 7i per cent will operate only on a very much less amount of the price.


Alexander Kenneth Maclean: It will be on the selling price less the excise of the country of origin?


William Thomas White: Yes.


William Findlay Maclean: Will it be on a flat declaration of that kind? Will your regulations say that the customs duty will be imposed upon the selling price in the country of origin less the excise duty?


William Thomas White: The proviso is:
Provided also that excise duties shall be disregarded in estimating the market value of goods for the purpose of this amendment to the Customs Tariff Act of 1907.


Alexander Kenneth Maclean: Would not the excise be a part of the selling price? Is not the excise tax paid by the foreign producer in the country of origin part and parcel of the selling price?


William Thomas White: No doubt, that is, if the
goods are for home consumption.


William Findlay Maclean: How can you separate them?


William Thomas White: The invoice value of goods exported in bond will not include the excise duties.


William Findlay Maclean: You propose in the first place in exacting the duties to ascertain the selling price and then specifically deduct the excise?


William Thomas White: The invoice value is always the price less the excise duties.


Frank Broadstreet Carvell: I do not think the minister understood the question of the hon. member for Yarmouth (Mr. Law.) The question was: Will the changes which my hon. friend now' proposes still leave a greater protection to the Canadian producer of spirits than he had before the hon. gentleman's Budget speech on February 12?


William Thomas White: I do not think so for this reason, that the distiller will have to pay the same rates, the 7.) per cent or the 5 per cent, upon his raw materials and upon his machinery and not only that, but it is by no means clear that the price will at once rise to the level of the existing price plus the 7) per cent or the 5 per cent.


Frank Broadstreet Carvell: And then on the other side of the account my 'hon. friend has pointed out what the distiller will pay. On the other side of the account he will have the protection of 7) per cent on
4 p.m. the cost of the article in the country of production, less the excise duty.


Alexander Kenneth Maclean: In that case it would be the importer who gets the advantage and not the distiller.


William Thomas White: If the importer brings it in the duty is less. No doubt my hon. friend has that in mind. What I am doing is to cut dowm the amount of duty which will be paid upon the importation on spirits.


Wilfrid Laurier: Tha* is an improvement.


William Thomas White: I am glad that my right hon. friend again says that is an improvement. Before I get through my right hon. friend will probably be wholly converted.


Wilfrid Laurier: Will my hon. friend allow' me? When he brought down these resolutions I drew his attention to the fact that the distiller had an advantage of
7.J per cent upon the foreign article coming into competition with his goods, w'hich in-73
eludes in the price to the consumer the excise duty; and the excise duty upon spirits is very high in all countries. A gallon of spirits will, as a rule, cost in the neighbourhood of $3, the cost of production being about 50 cents per gallon, and the excise about $2.50 per gallon. Therefore, the distiller w'ould have 7) per cent upon the $3, the selling price in the country of origin. If my hon. friend drops the excise, and calculates the duty upon the cost of production without the excise, the distiller would still have a protection of 7| per cent on 50 cents, not on $3-a still large protection. Against that you say that the distiller in this country would have to pay 7J per cent upon his corn and upon his coal; and the point of the hon. member for Yarmouth (Mr. Law) was whether you are yet giving a large protection to the distiller. It is not possible for me to go into that fully, because I do not know the value of the coal or the corn that goes into the production of one gallon of spirits. But I think there is still protection in favour of the distiller.


William Thomas White: I think the amount will be almost negligible; it will be small at all events. The large factor pointed out by my right hon. friend is the excise. Shortly after I brought down the Budget I was waited upon by the representatives of the spirit trade, who pointed out that previously the duties had been specific, and that these proposals would give an undue or disproportionate advantage to the distillers. Upon consideration it appeared to me that their complaint was well founded; and this appears to me to be the solution of the difficulty, for I think it will be substantially fair to the spirit trade, and substantially fair also to the distiller. In dealing with this question we must not forget that labour and capital are cheaper in European countries than here; and I need not go into the question of overhead charges. Therefore, having regard to the fact that the distiller has to pay the duty upon his coal, upon his corn, and upon his machinery, and having regard also to the fact that he has higher operating charges than abroad, I think that any advantage he might get from this tariff would be inconsequential.


Frank Broadstreet Carvell: The minister has mentioned Britain and Holland. Could he give any idea as to the percentage of the fair selling price of a gallon of whisky? I mean the proportion between the cost of production and the excise paid in the for-



eign country? Would it be 50 per cent each, or 25 per cent and 75 per cent?


John Dowsley Reid: I might say that the price of liquor per gallon is about 40 to 50 cents in bond, but the excise duties vary in different countries.


Frank Broadstreet Carvell: Take Britain or Holland,
the two countries mentioned by the Minister of Finance.


John Dowsley Reid: The question of excise does not come in at all in the proposals of the Minister of Finance.


Frank Broadstreet Carvell: If you take it out, and we could easily reckon the cost of production know the cost of a gallon of whisky, we in a foreign country-


John Dowsley Reid: Foreign countries sell their liquor as we do, in bond. In England it would be about 40 to 50 cents a gallon, and they do not have to pay the excise duty in that country.


Frank Broadstreet Carvell: That answers my question.


John Dowsley Reid: There is no excise duty upon liquor that is exported from those foreign countries. It is necessary to state that it is the price in bond, for the reason that in our old tariff it is specifically mentioned as so much per gallon. The question of price is not so important, on account of it being mentioned in the original tariff as per gallon. But in this case it is necessary to have it stated in the tariff that it is the price of liquor as sold in bond.


Frank Broadstreet Carvell: I wanted to find out what the liquor really cost in the country of production, and I think the Minister of Customs has answeTgd my question. He says 40 to 50 cents. We can easily argue from those figures. If a duty of 5 or 7| per cent is applied, we can easily find out to what extent the home producer of liquors is protected.


Sir ROBERT BORDEN:: I made an inquiry in consequence of what my hon. friend from Halifax (Mr. A. K. Maclean) asked a moment ago, and the information afforded has been practically given, by both my hon. friend the Minister of Customs and the Minister of Finance. But perhaps the answer may not have been clearly understood. The difficulty has arisen from the fact that for the most part the duties imposed upon liquors, both by way of excise and by way of customs, have been specific duties, which of course are very high. Now, under the Tariff Act, the value upon which

the duty must be imposed is the fair selling price in the country of exportation, but in the case of liquor the fair selling price in the country of origin is very largely composed of excise duties. Perhaps 75 per cent is composed of excise duties if the liquor is sold in that country. But in other countries, as well as in this country, when liquor is sold for export, the excise duty is not paid. Therefore, if the proposals as first brought down were to be interpreted in that way, and apparently the customs authorities think they would be so interpreted, the result would be that a tax would be imposed upon an amount three-fourths or four-fifths of which was not paid by the importer. Do I make myself clear?


Alexander Kenneth Maclean: Yes, I understand.


Robert Laird Borden: For that reason, in order to get the fair selling value, within the meaning of the Act, it is proposed to disregard that portion of the supposed selling value which is not really paid by the importer and which is represented by an excise tax upon the goods exported from the country of origin and imported into this country. So that it comes down practically to this: The 5 or 7J per cent duty is to be paid upon the price which the importer actually pays for the liquor that he brings into this country.


Frank Broadstreet Carvell: Which would be 40 or 50 cents a gallon according to the Minister of Customs.


Alexander Kenneth Maclean: Instead of having a mixed tariff, would it not have been better to have imposed an additional specific duty, which would be equivalent to the 7J per cent on the selling price in the country of origin?


William Thomas White: I am informed that the
Customs Department can administer the tariff in respect of the commodities we have been speaking of at the ad valorem rates. For uniformity, with, I think, one exception, we have determined upon the 7J. and 5 per cent general horizontal raise in the tariff, as I stated in the Budget. I gave consideration to the question drawn to my attention by the hon. junior member for Halifax (Mr. Maclean), and discussed the matter with my tariff officers, and they discussed it with the Customs Department. They see no difficulty in administering the tariff under the ad valorem rates, which are in addition to the specific rates.


Frank Broadstreet Carvell: Has the minister considered the advisability of levying the per

cent on the fair selling price in the country of production and putting on sufficient excise in Canada to equalize the matter, adjusting it so that you get the revenue, and the home manufacturers get no more protection? In my judgment, that is the proper course to pursue. My hon. friend may say there is such a thing as taxing an article beyond the point of producing revenue. As far as I am concerned, you can tax whisky just as high as you want to, and if we do not get the revenue out of it we will not have the stuff in the country. I think it would have been better if the minister had added on the excise in Canada and balanced up the price to the importer after he had levied the 7$ per cent.


John Dowsley Reid: The rates of duty of 5 per cent and 71 per cent on the liquor that will now be imported will be estimated on a value of say about 40 cents per gallon, the export price from the exporting country. If the duty is 5 per cent it will be two cents per gallon, and if it is 7J per cent it will be three cents per gallon, in addition to the present customs tax of three dollars per gallon.


Frank Broadstreet Carvell: Suppose you had left out the tariff proposals of a month ago?


John Dowsley Reid: Wait till I answer this question. The manufacturer of liquor in this country pays 7J per cent additional on his corn. Sixty cents per bushel is a fair average price for corn. That would be about five cents per bushel, in addition to which he pays duty on his coal. The duty that would be paid on the quantity of liquor produced from a bushel of corn would about balance up the duty that would be imposed on liquor coming from a foreign country. So far as the liquor manufacturers in Canada are concerned, I cannot see that they are getting any advantage, such as has been suggested by the right hon. leader of the Opposition (Sir Wilfrid Laurier).


William Pugsley: This is not a question
entirely between the importer of liquor and the distiller. Is it not of some interest to the people? They are paying a tax upon practically everything that they eat or wear, and they are interested in the rates of duty that may be imposed. Under the Budget as brought down there was to be a duty of 7J per cent from countries to which the general tariff applies, and of 5 per cent from countries enjoying the British preference, and these rates were to apply to all spirits imported into Canada. I understand that 73J
by the present proposals it is intended to reduce the value of these imported spirits for duty purposes by 75 per cent. It is stated that the excise amounts to 75 percent of the value, and there/ore, instead of spirits worth $1,000,000 paying a duty upon $1,000,000, as they would have to pay under the Budget as brought down, by this change they will only pay a duty upon $250,000. Is that fair? My hon. friend has sought to impose taxes all round; he says tney are going to bear equally upon all the people-and that he is going to raise so much revenue. Then, when he is brought face to-face with the fact, as pointed out to him by my right hon. friend the leader of the Opposition, that he ought to have increased the excise duty as against the distiller; so kindly disposed is he towards the distiller that he says:	I will not do that, but I
will make it all right to tne importer by reducing his valuation to the extent of 75 per cent:


William Thomas White: This is against the distiller.


William Pugsley: No, it is in favour of the importer.


William Thomas White: It is against the distiller.


William Pugsley: It is against the distiller, but it could have been made equitable as between the distiller and the importer by raising the excise duty.


William Thomas White: No.


William Pugsley: Why not?


William Thomas White: My hon. friend from Carle-ton (Mr. Carvell) answered his own question and also the objection of the hon. member from St. John (Mr. Pugsley). He stated that there is a point beyond which, if you carry your taxation you defeat your own ends.


Charles Marcil: Can the hon. gentleman tell me why that happens?


William Thomas White: My hon. friend knows well why it happens.


Frank Broadstreet Carvell: 
William Thomas White: We have no conclusive
evidence, but the opinion of the experts of the Customs Department and of my department is that with the excise that we imposed last August upon liquors and tobacco we reached the maximum in so far as excise is concerned, and that if we increase

beyond that point instead of getting a greater revenue we will get less revenue. That is the answer to my hon. friend.


Frank Broadstreet Carvell: We have had six months' experience; what is the result?


William Thomas White: My hon. friend can analyse the result as well as I can. My hon. friend knows that many factors have entered into the consideration of that question during the past few months, such, for instance, as the dislocation of trade and commerce. I am not going over the ground that has been traversed so frequently during the late debate, but my view is that we cannot increase the excise without defeating our purpose, which is to obtain more revenue.


Wilfrid Laurier: There would be a less consumption of liquor then?


William Thomas White: Possibly so.


William Pugsley: That would not be an unmixed evil.


William Thomas White: We are not discussing that question now; we are discussing a revenue Bill. Probably my hon. friend, if we were speaking of it from another standpoint, would find that I was not less desirous of restricting the consumption of liquor in Canada than he is. But we are not now dealing with that question; we are dealing with the question of revenue. Our starting point is that it is not advisable to increase the excise in the interest of obtaining revenue. That being so, if we had allowed the 74 per cent and the 5 per cent to apply to the fair selling price-and as my hon. friend the Minister of Customs has pointed out, goods are sold abroad in bond and regard should be had also, as required by the Customs Act, to the excise , of the foreign country-the effect would be to give the distillers altogether too great an advantage, and that is what my hon. friend had in his mind when he called my attention to it. That is what my right hon. friend the leader of the Opposition had in his mind, and that is what was drawn to my attention some time ago by the spirits trade. What we are seeking to do is to get the maximum of revenue and to so deal with our revenue proposals that neither the distiller on the one hand nor the spirit importer on the other will have an undue advantage; in other words, to get the maximum of revenue with fairness and justice to all concerned.


Wilfrid Laurier: The argument of my hon. friend (Mr. White) is not an

answer at all to the objection of my hon. friend from St. John (Mr. Pugsley). The hon. gentleman says that we cannot increase the excise because we would defeat the object of the Bill, which is to obtain revenue. My hon. friend the Minister of Finance thinks that he will get revenue if he adds 74 per cent to the customs duties. If the trade can support 7) per cent of an increase in the customs tariff on liquor it could support also an excise duty. The two things always go together.
The Minister of Finance says he cannot afford to reduce his revenue, because if he puts more excise on he will defeat the purpose he has in mind. If you put the customs duty at 74 per cent you expect you will have the same quantity of liquors coming in and that you will get the increased revenue, but in the matter of spirituous liquors excise duty and customs duty always go together. It is the intention of the legislation that there should be no protection and that the whole revenue should go into the treasury. If there is more duty on the liquor that comes from abroad, there will be less production here, and if there is less coming from abroad there will be more production in Canada. In order that there should be no protection to the distiller all governments have wisely provided that there should be a customs duty equalled by an excise duty; in other words, that the duty paid on every drop of liquor which is consumed in this country shall go into the treasury.


William Thomas White: There has been an
excise duty corresponding to the customs duty, but there has been additional customs duty as well. My point is that the distiller must pay upon his raw materials 74 per cent. The 74 per cent will apply, not to the selling price abroad, having regard to the excise contained in it, but upon the selling price abroad without regard to the excise. My hon. friend from St. John (Mr. Pugsley) states that we would have got a certain amount of revenue from the liquor that would come in if we imposed a 74 per cent or a 5 per cent increase upon the selling price of the liquor abroad, including the excise. My answer to that is simple: if I did not amend as I am now amending, the liquor would not come into the country. The duty would be too high in competition with the home-manufactured article, and therefore I would not get as much revenue as I now get.


William Pugsley: If the same quantity
of liquor was used as before, whatever was

lost from customs would be gained by excise.


William Thomas White: My hon. friend is begging the question. I am proceeding upon the ground that you cannot increase the excise by 71 per cent without defeating your purpose.


William Pugsley: Can you defeat your purpose unless there is a lesser use of intoxicating liquors ?


William Thomas White: That is a different question and we are not arguing that. Some day it may be necessary to argue the question as to whether it would be desirable to limit the importation and consumption of liquor, but the question before us now is the question of getting revenue, and at present we are considering a revenue measure. If I did not make this amendment I would not get the same revenue. My hon. friend says the same amount of liquor will be consumed, and that we can make up for the decrease by putting excise on the home-made article. We have considered that and we have come to the conclusion that we could not put the 71 per cent on the home-made article without defeating our purpose to raise additional revenue.


William Pugsley: The Minister of Finance will admit that the only way he could defeat his purpose by making the excise duty too high would be that he would not get as much money from excise. The same quantity of liquor would be imported as long as people continue to use intoxicating liquor, and what he would lose in excise he would gain in customs. On the other hand, if he left the customs duty as he proposed, then anything he lost in customs he would gain in excise. Is not this the fact: That the Minister of Finance has really been tender towards the distiller. There is no class of people in this country who have made more money out of their business than the distillers of Canada; there is no wealthier class in the country than they, and there is no class which requires less consideration, so far as excise duties are concerned. It does seem to me that what the Finance Minister ought to have done was to have increased the excise duty, if he wanted to equalize the obligations as between the importers and the distillers. Instead of doing that, he proposes by a scratch of the pen to take off 75 per cent from the tariff duty which has to be paid by the importer. That is what the Minister of Finance purposes doing. The effect of what the hon. gentleman says
is, that if he leaves the import duty as proposed and he increases the excise duty, he will make the cost of liquor in this country greater. Everybody admits that the result of this tariff will be to make the cost of clothing, the cost of foodstuffs, the cost of all the necessaries of life greater by the extent not only of the duty imposed but also by reason of the extra price which will be charged by the manufacturers on the home product. Suppose the people of this country who use intoxicating liquors have to pay a little more than they do now, and suppose they have to bear their share rf the burdens which all the people of this country are called upon to bear by reason of this so-called war tax, would there be any great evil in that? I do not believe that the use of intoxicating liquors will be affected one iota by the raising of the excise duty or the increase of the import duties. If they want to drink liquor at the club, in the hotel, in the bar-room, in their private houses, they will drink liquor notwithstanding that a few cents more per gallon are added to the cost. Of course, the Minister of Finance knows that I do not agree with his tariff at all and that I believe it is all wrong, but instead of making a reduction and seeking to lessen the burdens on those who drink intoxicating liquors, he ought to have left the import duties as they were, and if he wanted to equalize matters as between the distiller and the importers he could have raised the excise duty to a reasonable amount. Then if as a result people did not buy as much liquor which was distilled in Canada, there would be so much more imported, and whatever the Government might lose in excise duty it would gain in customs duty.


Mr. BURNHAM:: Do I understand the
hon. member to lay down the principle that the raising of the tariff rates will not decrease the consumption of liquor?


William Pugsley: My view is that the raising of the tariff rates as proposed will not materially reduce the consumption of liquor-.


Alexander Kenneth Maclean: Do I understand the Minister of Finance to argue that the additional duties imposed upon the raw materials of the distillers are the equivalent of the additional excise, and for that reason no substantial excise duties are imposed?


William Thomas White: I do not desire my hon. friend to understand me as saying that. We are dealing with a 7J per cent ad valorem duty. The question is raised as to whether

it is effective and if so to what extent additional protection is given to the distiller. The distiller has to pay upon his corn, and upon his coal, and upon his machinery and his packages, the war revenue tax on the basis of 7J per cent or 5 per cent. As a set-off to that, and also for the purpose of obtaining revenue, we are imposing the 7j per cent and the 5 per cent upon the selling price. It is necessary I should insert this proviso because if I did not, under the provisions of existing legislation, the customs officials would have regard to the foreign excise tax.


Alexander Kenneth Maclean: I think we understand that.


William Thomas White: Very good, then; my hon. friend (Mr. Pugsley) took the view that we are depriving ourselves of revenue by making this change, and he also put forward the assertion that we were tender to the distiller. My hon. friend knows as well as 1 do that in making this change, instead of being favourable to the distiller it is distinctly unfavourable to the distiller as compared with the proposals in the Budget, because the product of the distillery here is in competition with the spirits imposed by the import trade. Therefore, what I am doing, instead of being favourable to the distiller, is decidedly unfavourable to him. I am not doing it to be unfavourable to the distiller, but to do simple justice as between the distiller and the importer. My hon. friend says, why not raise the excise 7J per cent and let the 7J per cent as it is remain on imports? My answer is that in August last we imposed very substantial additional taxation upon spirits and I have been advised by the experts of the Excise Department and of the Customs Department that we have raised it up to about the maximum point, and that if we carry the duty beyond a certain extent there will be smuggling and illicit manufacture, and there might also be a diminution of consumption which would reduce the revenue. We are not dealing with the question of advisability or non-advisability of diminishing consumption-or, at least I am not- the only question is as to additional revenue. It seems clear to me that we shall not deprive ourselves of additional revenue by reason of imposing the additional 71 per cent upon the selling price disregarding the foreign excise duty, because, as the proposals were brought down, on account of our not having inserted the proviso I now propose to insert, the importations would be greatly diminished, and there-

fore our revenues would fall off although the rate would apply upon a higher value than will now be the case. Therefore, the answer is in regard to increasing excise I am advised that I should defeat my purpose. As to the duty on imports, in the first place I should receive less revenue under the proposal of the Budget than I shall now obtain; and secondly, unless my proposals were amended the distiller would have an unjust advantage. What I propose to do is to put our proposal upon a just and equitable basis so that I shall get, as I judge it, the maximum of revenue, and at the same time hold the scales even as between -the import trade and the distiller, and not give the distiller a disproportionate advantage.


Charles Marcil: I cannot speak for other
provinces, but I know that in the province of Quebec the consumption of liquor must have fallen off materially during the past year or two. In thp lower part of Quebec between Levis and Campbellton there is not a single licensed hotel.


Wilfrid Laurier: There has
not been for many years.


Charles Marcil: Not for many years. In Montreal 70 licenses were cancelled by the License Commissioners, the Government of Quebec allowing compensation to those who sold out. The liquor business in Montreal has fallen off very materially. A wholesale liquor dealer told me a few days ago that whereas an ordinary saloon in Montreal would sell $400 or $500 worth of whisky in one week, the sales have fallen off to $125 or $150 a week. I read this morning that one of the famous night cafes in Montreal which have caused	so	much discussion, was
recently sold out, the whole	outfit
being knocked down under the auctioneer's hammer. But, as the minister says, we are not discussing this from the moral point of view, but from the point of view of revenue. The great objection to the kind of liquor sold in Quebec is that it is often greatly adulterated. I remember that a few years ago-the hon. Minister of Finance was not here then-the hon. member for South York (Mr. W. F. Maclean) gave us an elaborate explanation of the manufacture in Toronto of Scotch whisky, liquor of a very inferior quality, that never saw the Highlands of Scotland-nor the Lowlands either. It is an infraction of the law to sell as Scotch whisky that which is not the genuine article? And is there, under excise regulations or otherwise, any control by the

Dominion Government over the selling of poisonous drugs under the name of whisky, such as are sold in many bars to the poorer classes of people?


William Thomas White: I am afraid I am unable to answer my hon. friend with any authority. I understand that, in the case of whisky, if the word " Scotch " should be taken to apply to the quality of the liquor and not to the place of origin there would be some redress. But my opinion is not worthy of weight because I have not specially looked into the matter. I think that the hon. member (Mr. C. Marcil) does not dissent from the views I have expressed because if he is interested in seeing that there shall be quality in the liquors, then it is obvious that there should not be a disproportionate or inequitable advantage to the home manufacturer. In other words there should be a stimulus to competition as between the home manufacture and the imported article.


Charles Marcil: I thank the minister for his explanation, but I fear I did not make plain the point I wished to bring out. I wished to know if there is any system of inspection over the manufacture of liquor in Canada. I often see newspaper advertisements of whisky in which appear some such words as "Inspected by Government officials." Is that really the case with all the liquor manufactured in Canada, or not?
Mr. W'HITE: In a sense, I think it is, because the manufacturer is required to keep the product a certain time. But I do not believe-though I should be glad to be corrected if I am wrong-that the Dominion carries on inspection as to quality. It is quite possible that the provinces do, as they issue licenses for the retail and wholesale sale of liquor.


Charles Marcil: I do not wish to insist on the point, but the minister will see the importance to the labouring and poorer classes, if they must have liquor, that it should not be of a poisonous character. Some of the drugs sold to the working classes as liquor are nothing less than poison.


William Thomas White: I have explained the modifications which I have proposed, and I desire to move this resolution, which is the resolution of which I gave notice in my Budget speech, modified as I stated in my opening remarks to-day.


Alexander Kenneth Maclean: Would not the order be to pass the original resolution through committee and then propose the
other? Or is the minister only presenting this as an amendment?


William Thomas White: I took the opportunity of consulting the Clerk of the House on the subject. He stated that I had given notice of the resolution, but had not moved it, and therefore I could move this resolution in committee, which, as I have stated, embodies the modifications I have made in the resolution of which I gave notice in the Budget speech. I believe the procedure is regular. If there is any doubt about it, I could move to have the resolution of which I gave notice amended by this.


Wilfrid Laurier: I think the regular procedure would be, if there is to be a departure from the original notice, to give the notice again. But we will not insist on that. *


William Thomas White: I inquired as to that. If 1 were proposing to increase the burden of the tax, I should give notice, but what I am doing is exempting, and that, I understand, can be done in committee without notice. But I should be glad to oblige my right hon. friend in any way, and, if he desires, to allow this to stand as a notice of motion. But there are so few amendments made that I suggest we might proceed.


Wilfrid Laurier: Hear, hear.


William Pugsley: Before proceeding, I wish to congratulate the Minister of Finance upon his having yielded, even if only after some four weeks' discussion, to the protests made by this side of the House with reference to some very onerous and some very unwise impositions proposed in hjs Budget speech. I want to refer especially to the taxes on fertilizers. As to that, I do sincerely congratulate the Finance Minister and the Government for having even at this late date acquired wisdom as 'to what it is proper to do in the interests of the farmers of Canada. My hon. friend has said that representations were made to the Government by members on both sides of the House in favour of exempting fertilizers. Surely my hon. friend is mistaken as to that. The hon. member for Assiniboia protested against the duties on fertilizers, showing that it was proposed to increase the duties upon fertilizers 'coming from Great Britain by 100 per cent, and upon fertilizers coming from the United States and other countries under the general tariff by 75 per cent. He pointed out that this was a marked instance in which a preference was given not to Great Britain, but to the United States. I myself called attention to this onerous burden proposed

to be placed upon the farmers, and quoted from letters *which I had received protesting against the imposition of such a tax. But hon. gentlemen on the other side of the House justified this proposed burden upon the farmer. The hon. member for North Essex justified it, and other hon. gentlemen, equally eloquent, equally forcible in their argument and equally influential, justified it. My hon. friend said it was a small thing to be divided among 800,000 farmers, as if every farmer in Canada were going to use a part of the fertilizer imported and pay part of the aggregate duty. This is but another evidence of the fact that whatever proposal my hon. friend and his colleagues make to the House, hon. gentlemen behind him are ready to back it up, to support it, to justify it. However, for hon. gentlemen to go even this short distance, by reversing their proposals, in encouraging the farmers to increase their production, is worth the three or four weeks discussion which we have had in this House. I have taken a very humble part in bringing light and understanding to my hon. friend the Minister of Finance, but even for the little that I have been able to accomplish I am very thankful indeed. My hon. friend will realize that other hon. members on this side of the House have led him into the proper path.


William Thomas White: The taxes that we proposed are for the purpose of meeting the situation caused by the war. Our intention was to make the increase fairly general in its operation. We made a number of exceptions. I am quite certain that the farmers of the country would be willing to pay the tax in question for the purpose that we had in view in imposing it. The times are not normal; in norma] times we should not have brought down these proposals. It appeared to me from the discussion that took place that certain sections of the country are possibly more immediately interested in this tax than other sections are; certainly, having regard to the size of the country and the extent of the farming community, the tax as a whole would have been a small one. But, as I stated, it has been represented to me that the placing of fertilizers in the list of exemptions might tend to facilitate the propaganda of the Department of Agriculture, which has for its object the very laudable and, indeed, patriotic purpose of increasing production in Canada. As I say, the proposed tax is small, but even if

it had been larger, in view of the requests made, as I have said, by hon. gentlemen on both sides of the House, I need not say that it would have been a pleasure to me to place it in the list of exemptions. I could argue justification for the tax and for all the proposals that we have brought down, having regard to the very extraordinary situation which we have been compelled to meet. However, I am glad to receive congratulations, if they are in order. We have placed the tariff rates upon fertilizers precisely where they were before. As everybody seems to be happy-


Frank Broadstreet Carvell: Oh, no.


William Thomas White: Is my hon. friend not happy?


Frank Broadstreet Carvell: No, you have not gone far enough.


William Thomas White: I have gone farther than my hon. friend's tariff went.


Frank Broadstreet Carvell: Eliminate the tariff on fertilizers; then you will be doing something.


William Thomas White: My hon. friend was a long time there before I was here; I do not know that he made very much progress in that respect. What we have done is, I think, very fair, and will meet the requests that have been received from various parts of the country through the Agricultural Department.


Mr. PARDEE:: I should like to draw the attention of the Finance Minister and the Government to the matter of gravel, which was formerly on the free list, but now to be subject to a duty of 7] per cent. The hon. minister rather smiles at that suggestion


William Thomas White: Oh, no.
Mr. PARDEE-But I can assure him that it is a very burning question in our part of the country. We have great difficulty in getting this material for the purpose of manufacturing concrete for foundations, etc. It is one of the crying necessities of our farming community. I think that what I say in this respect will be borne'out by the hon. member for East Lambton (Mr. Armstrong) and by the hon. member for North Essex (Mr. Wilcox). Not very long ago a large deputation waited upon the Government, and I think that my hon. friend the Minister of Finance and the Minister of Public Works were among the gentlemen who received that deputation. They laid

before the Government their request that gravel should be brought in and distributed by the Government free of charge. At that time I said that although I was not wholly in accord with that plan, I thought that everything should be done by the Government that could be done in order to enable the farmers to get this commodity in the easiest possible way. At the present time practically one company has the'whole concession along the St. Clair and Detroit rivers, in so far as the Canadian side is concerned. They have secured this concession under license from the Dominion Government and the Provincial Government of Ontario, and no person else is allowed to go there and take away gravel.


Mr. WILCOX:: What company has the concession to which my hon. friend refers?


Frederick Forsyth Pardee: I think it is the Cadwell Sand and Gravel Company of Windsor. As a result, those persons who desire to deal in that commodity have to go to the American side of the river, bring the gravel into Canada, and pay a duty of 7{ per cent upon it. Having regard to the peculiar need of the community-although perhaps not so much to that peculiar need as to the peculiar way in which this commodity has to be obtained-and to the fact that the revenue the Government would receive from this source would not be very great, it would be a great help to the farming community if they were enabled to obtain this commodity at as little cost as possible. It might be well for the minister and the Government to take into their very careful consideration the restoration of the articles under that tariff item to the free list. I can assure the minister that such an action would be greatly appreciated and that although it may look like a small thing it is a question of very burning importance in our part of the country, whatever it may be elsewhere. The revenue derived from the imposition of this tax of course will be trifling and will be more than counterbalanced by the resulting benefit to the farmers.


Oliver James Wilcox: In view of the fact that
the hon. member for Lambton (Mr. Pardee) has made some reference to the Windsor Sand and Gravel Company, as I have some knowledge of the business in which they are engaged, it may be wise for me to make a few remarks. Complaints have been made to me upon former occasions. While the hon. member for St. John was Minister of Public Works, that is before the change of
Government, three large sand bars in the St. Clair river required constant dredging in the interests of navigation, the expenditure on them running from $25,000 to $35,000 a year. The Windsor Sand and Gravel Company applied for permission to dredge the bars, and entered into an agreement to furnish 2, 3, 4 or 5 dredges if need be to keep that channel open to navigation. The company put in an equipment costing them over $60,000. From that day to this they have kept the channel open, free of cost to the country. The company have no exclusive rights under their agreement, they have simply a permit and the Government are free to grant similar rights to any other company or individual.


Frederick Forsyth Pardee: I am not making a plea against the company, I am asking that this protective duty be removed.


Oliver James Wilcox: I understood my hon.
friend to say that the company had the exclusive right.


Frederick Forsyth Pardee: Yes, so it has.


Oliver James Wilcox: That is not the information given me by the hon. member for St. John (Mr. Pugsley). I have seen the lease and my recollection is that it did not state that they had an exclusive right.


Alexander Kenneth Maclean: Clear of that altogether, should the duty be imposed?


Oliver James Wilcox: As a farmer, and I believe that I obtain the same view as other farmers, I have always felt that we want to pay our honest share of the increased taxes of this country. I do not believe in this handing out of something to the farmers of this country as a kind of a sop in which there was little or nothing with the object of creating a little sentiment to get a few votes.


Frederick Forsyth Pardee: I am glad my hon. friend takes that view. His farmers will be glad.


Oliver James Wilcox: I never heard of gravel
being imported in my part of the country. The gravel is all got along the Canadian side. All around lake Erie, lake Ontario and the Detroit river, the gravel is got on the Canadian side. In any case, very little sand or gravel taken from the lakes is used by the farmer, to discuss it in this way is only hair splitting, because the farmers in my part of the country get their gravel and sand in the southern portions of the country, where there are many good pits, some of them 30 and 40 feet deep.


William Pugsley: The hon. gentleman referred to a contract that I had to do with as Minister of Public Works. I am not quite sure that I rememDer the locality; but is it not in the international river.


Oliver James Wilcox: Yes.


William Pugsley: And does not the company dredge from both sides of the boundary line? I know they take gravel over to the United States and it goes in free of duty, but I thought that in some cases they brought it from the United States to this side.


Oliver James Wilcox: My hon. friend is right. The Canadian side is gravelly. The action of the stream carries the lighter parts, the sand, to the American side, and when the company desire sand, as I understand it, they have to get it from the American side because there is no sand on the Canadian side, only the heavier portions, the gravel.
With respect to the duty on fertilizer, which my hon. friend says I commended, I think the Minister of Finance spoke of some one being unhappy, and the right hon. leader of the Opposition said very quietly, Wilcox.
I want to assure my hon. friend that I am perfectly happy. My remarks with regard to this subject were more to put my hon. friend right on the question of squid, because he mistakenly argued that squid was a fertilizer. That was the introduction of the fertilizer topic.


William Pugsley: A very adequate justification, very happy.


Oliver James Wilcox: My hon. friend knows that he was mistaken; he admitted he was mistaken, apd he spoke of using it as a spray for trees.


William Pugsley: Did not the hon. gentleman tell the House that the total duty on fertilizers was only $4,600, and when a correction was made did he not say it was a mere bagatelle on the farmers of the country, anyway?


Oliver James Wilcox: My hon. friend must not put words into my mouth. He is always good natured, and I shall be good natured, too. But I am not going to stand for my hon! friend's putting words into my mouth that I did not use. I explained the matter fully, and my hon. friend said that I had given him a complete answer when I had said that one figure had been left out. I said that the duty amounted to $46,000, and that the census returns showed that there were 800,000 farmers in this country, and TMr. Wilcox.]
that therefore the duty averaged five and three-quarter cents apiece. We do not use this fertilizer extensively in our part of the country. It is used, however, by a number of farmers who are engaged in intensive farming. For instance, there is a Mr. Ellis who has five acres under glass in Leamington. I was present at his plant in the month of April, when he picked a ton of tomatoes for-which he received 25 cents a pound. On the whole winter's operations he cleared $13,000. Now, that man uses a good deal of fertilizer, and he is just as able and as willing to pay the duty as any other man in this country. I was very much surprised yesterday when the hon. member for Carleton (Mr. Carvell) told us how much fertilizer was used in his county. I have absolutely no objection to the amendment suggested by the Minister of Finance. I only wished to explain what I had said in regard to what this war tax would bring, and what it would average to the farmers of this country. I believe that the farmers realize the death and misery on the battlefields of Europe, and the issues that are involved in this great conflict, and I believe they are willing to pay their share of the duties because we are living happy and free, so to speak.


Archibald Blake McCoig: I am
very glad that the hon. member for North Essex (Mr. Wilcox) is not going to object to the putting of fertilizer materials on the free list. He states that fertilizer is not very extensively used in his part of the country. I represent the adjoining county, and I wish to join with the hon. member for St. John (Mr. Pugsley) and other members in expressing my gratification that fertilizer materials are to be put on the free list. I am sure that the constituents whom I have the honour to represent will appreciate it very much. There are men in the county of Kent who use as much as four or five tons of fertilizer a year, and these men are classed among the most successful farmers in the province of Ontario. The duty originally proposed would have been quite an item to them, and for that reason I take this opportunity of thanking the Finance Minister for having made this change.
I am sure it will be of considerable benefit to the people I have the privilege to represent. Might I at the same time ask the Minister of Finance to take into his consideration the question of putting on the free list the machinery that is used for putting fertilizer on the ground for the different crops. Many kinds of implements are used foi; this purpose in connection

with planting beans, corn, tobacco, and sugar beet, and only a very small percentage of this machinery is made in Canada; so that if the minister granted this request it would, at the worst, be depriving only a few of our labourers of work, and it would be of great assistance to our farmers who grow such varied crops. I am sure they would greatly appreciate it. N-1 should also line to say that I am heartily in accord wim what the hon. member for West Lambton (Mr. Pardee) has said in connection with gravel and sand. The hon. member for North Essex said in substance that the farmers in his section of the country would not consider it very serious if this tax was kept on. In my section of the country large quantities of sand and gravel are used. If I remember correctly, when the deputation met the Minister of Public Works and other ministers some time ago, it was the hon. member for East nambton (Mr. Armstrong) who made the greatest protest against what, if carried out, would have assisted the farmers of south-western Ontario in the way of putting up barns and improving sidewalks in uie villages and towns. I believe that on that occasion Mr. Cadwell represented the concern winch has the exclusive right of getting gravel and sand from me auierent rivers that have been referred to. So that you see he was looking after his own nnancial interests, while other gentlemen were endeavouring to find ways and means whereby the gravel and sand could be distributed through the different counties in south-western Ontario at as low a price as possible. I cannot agree with the hon. member for North Essex that the Cadwell Company should be allowed this exclusive privilege. I think other firms should be given an opportunity of competing. If the plants required in this business are so expensive that other firms cannot see their way clear to going into the business, then I agree with the hon. member for West Lambton (Mr. Pardee) that no further protection should be given to this concern by putting a duty of 7i per cent on the material which is needed so badly in south-western Ontario. That is the position I take. I appeal to the Minister of Finance to give this matter his most serious consideration, and not to allow this firm any longer to compel the farmers of this country and the citizens of the different villages to pay just what they see fit for the gravel and sand that is so necessary for tne improvement of the country generally.
Mr. J. E. ARMSTRONG (East Lambton); I was interested in the remarks of the hon. member for West Lambton (Mr. Pardee) in bringing this matter before the House. It is one of very great interest to the people living in the western peninsula, who are compelled to make use of these materials for building purposes and for road-making. If they wish to bring in building material to the Western peninsula they have to go something like a hundred miles to get it; in fact, it is almost impossible for the people in the western district to get building material for roads or bridges or for what is required around the farms, unless they get it from the Cadwell Stone and Gravel Company. It is true that a year or two ago a deputation came to Ottawa with the object of persuading the Government to cancel the contract with the Cadwell Stone' and Gravel Company, which was entered into under the administration of the ex-Minister of Public Works.


Frederick Forsyth Pardee: May I correct the hon. gentleman? As I understand it, the Department of Public Works had the right only to give a license to dredge or reclaim sand in navigable waters. The power to give an exclusive right to take that sand from the bed of rivers lay with the Ontario Government, and it. was from the Ontario Government that they got their exclusive right. The Department of Public Works, during the time of my hon. friend from St. John (Mr. Pugsley), only went so far as to give them a license to dredge in navigable waters.


Mr. J. E. ARMSTRONG:: I understood from Mr. Cadwell, president of the Cadwell Sand and Gravel Company, that he was quite willing that any other dredge should go in there and take its share of the material. I am confident that I was right when I asked this Government to cancel that contract in the public interest and allow any person to go there, take sand or gravel and distribute it to the farmers and to the cities and towns at the lowest possible cost. If this Government had been allowed to carry out their good roads policy I feel confident that a portion of the money to be devoted to that purpose could have been invested to the very best possible advantage in Government dredges employed for the purpose of recovering and distributing sand and gravel to people generally in the western peninsula at practically cost. That

was the proposition that I placed before the Government, but unfortunately they had not the means to carry it out. They did investigate it, however, and when the time comes that we have sufficient money set aside for the purposes of good roads, there is no doubt that a portion of it should be applied to the dredging of sand and gravel from the mouth of the St. Clair river. Tens of thousands of yards come down and block the channel. The sand and gravel that comes down to the mouth of the St. Clair river comes from the Canadian shore. A portion of the sand, no doubt, goes to the American shore. I understand from the Minister of Public Works that at present any dredge is at liberty to go on the Canadian part of the river and dredge whatever sand and gravel it pleases, but if, as these hon. gentlemen say, the Cadwell Sand and Gravel Company have an exclusive right, then I would urge upon t'he Governmnt in the public interest to discontinue that contract and allow any one to go and take sand and gravel and use it for the purposes suggested by the hon. members for West Lambton and West Kent.


Frederick Forsyth Pardee: 
Joseph Elijah Armstrong: As I understand the contract, any person can go there at the present time and obtain a portion of the material. How many dredges other than those used by the Cadwell Sand and Gravel Company are dredging the material at the mouth of the river and disposing of it to farmers and citizens in general? I would like to ask the hon. member for West Lambton and the hon. member for West Kent to be good enough to name any companies which are likely to go to the United States side of the river, obtain this material, pay duty on it, and bring it into Canada. It seems almost absurd to expect that they would do anything of the kind.


Archibald Blake McCoig: The objection I have to this exclusive right lies in the expensive machinery that it takes to operate this business. No person is going to put thousands of dollars into a dredging outfit to supply sand and gravel, but if we put a duty of per cent .against American concerns, thus preventing them from coming in here with their sand and gravel, it means that we give an exclusive right to these people and they will take advantage of this item

and extract from the users of sand and gravel just so much more money.


Joseph Elijah Armstrong: Would the hon. gentleman be good enough to give me the names of one or two American firms which supply sand or gravel in Canadian towns or cities along the border ?


Frederick Forsyth Pardee: That is a very specious question. May I answer that question by asking him to answer my question as to whether he is in favour of the 7i per cent duty ?


Joseph Elijah Armstrong: If the hon. gentleman cannot name an American firm that has been delivering sand or gravel at any time on the Canadian side, then surely their argument falls to the ground.


Frederick Forsyth Pardee: 
Joseph Elijah Armstrong: I do not agree with the hon. gentleman that the Cadwell Sand and Gravel Company have the exclusive right.


Frederick Forsyth Pardee: If they have not ?


Joseph Elijah Armstrong: If they have not, what is the use of it ?


Frederick Forsyth Pardee: Then, would the hon. gentleman be in favour of putting on a 7J per cent duty ?


Joseph Elijah Armstrong: I am not here to be cross-questioned.


Frederick Forsyth Pardee: Very well; let it go at that.


Joseph Elijah Armstrong: The hon. gentlemen opposite have been unable to say that any sand or gravel has been brought from the American side of the river to the Canadian side. If none has been ,brought in during past years, and if the contract does not hold good, why would you expect that any would be brought in in the future ?


Archibald Blake McCoig: If the hon. Minister of Finance cannot remove that 7J per cent duty, would he give us the assurance that if the Cadwell Sand and Gravel Company raises the price to the consumer he will then remove the duty ?	[DOT]


William Thomas White: I am afraid that we are losing sight of the purpose of this tax. This tax is general, and I think it inadvisable to make any exceptions unless they are clearly in the public interest or it is manifestly unfair that the parties paying it should contribute under the circumstances to the war expenditure of this Dominion. Therefore, I say, that the question of whether there is an exclusive privilege or not has no bearing on the matter.
I have laid the full proposals before the House, and they are very general in character. There are a number of exceptions to them, some of which I have mentioned this afternoon. There is no gentleman in this House to whose representation I would be disposed to pay more favourable attention than the hon. member for West Lambton (Mr. Pardee). It is not a matter of dealing with this question abruptly, but I must maintain the principle that the object of this legislation is to obtain revenue, which but for the war it would not be necessary for us to obtain. It is admitted that the quantity of this sand required is comparatively small, and that the taxation upon it will consequently be small. I do not see my way at present-although I would be very glad to look into the matter-to make an exception in this case, because if I make an exception in this case and not upon principle, then I do not see how I can very well refrain from making exceptions in other cases. If the matter were large and if it were vital I would be disposed to give it more consideration, but the amount involved is small and it is extremely undesirable that we should widen the list of exceptions. We are going to need these revenues' to meet the financial condition of the Dominion which, as I maintain, has been occasioned in large measures by the war.


Oliver James Wilcox: I would ask the hon.
member for West Lambton (Mr. Pardee) and the hon. member for West Kent (Mr. McCoig) why the municipalities bordering on the lake that have not applied for shore rights under the provisions of the Beaches and Shores Act passed by the Ontario Government about four years ago. Any municipality can send its township engineer to lay out certain sections along the shore, and after that plan has been confirmed by the Ontario Railway and Municipal Board, all the farmers within the municipality have the right to take sand from the district outlined in the plan. That was done in my township of Rochester, and the farmers are obtaining sand at fifteen cents per load.


Frederick Forsyth Pardee: The riparian owner owns the foreshore; the Government has no right to it.


Oliver James Wilcox: The water lots are under the jurisdiction of the Government.


Frederick Forsyth Pardee: Yes, but the foreshore is owned by the riparian owner.


Oliver James Wilcox: No.
Mr. PARDEE
Yes.


Oliver James Wilcox: It is owned to the high
water mark.


Frederick Forsyth Pardee: Yes.


Oliver James Wilcox: From the high water mark to a point out about six feet is the water lot which is under the jurisdiction of the province.


Frederick Forsyth Pardee: Quite so; but a man cannot take sand from under the water.


Oliver James Wilcox: The sand 1 have reference to drifts in along the lake.


Frederick Forsyth Pardee: That belongs to the
riparian owner.


Oliver James Wilcox: But if the farmers are
authorized by the Ontario Railway and Municipal Board to get sand the law gives them the authority to do so and the price is stipulated by an order of the board.


Bowman Brown Law: During the last two weeks
some very harsh and unjust language has been hurled from the Government side of the House against the members of the Opposition, but now the Minister of Finance has seen fit to rebate the duty on fertilizers and on cotton-seed oil, and of that I am very glad. I believe that if the Opposition has accomplished nothing else by what the minister has called obstruction, we will

certainly have the good will of the farmers of the country for having the tariff on these items changed. I am very glad that I can claim some small credit for that, because in the few remarks I made the other day I advocated that the duty should not be raised on fertilizers or on cotton-seed oil. The question of the duty on spirituous liquors will come up again and I do not wish to say anything further about it at the present time. However, I am sorry the minister has seen fit to at all rebate the tax on liquors. I should have been quite willing to have supported a very much heavier tax on liquors had he proposed it.


Frank Broadstreet Carvell: I want to present the question of this tax on fertilizers in a little different form from that in which it has been before presented. I do so because in my own constituency probably one-third of all the fertilizers imported into Canada are consumed. The quantity imported does not nearly represent the total consumption, because there are large quantities of these commercial fertilizers manufactured in the maritime provinces, and I am satisfied that our farmers purchase as much of the home product as they do of the imported. I believe I am well within the mark when I say that the fertilizers used by the people in my constituency cost about $400,000 per annum. We are paying on that a ten per cent tax. It is true, as the Minister of Finance says, that this duty existed when the Liberals were in power, but that does not alter the matter, and the tax is there just the same. The consumption and the use of these fertilizers has greatly increased in recent years, and I am satisfied that until 1911, $50,000 or $75,000 would represent the value of fertilizers used in my constituency. The business has gone on, perhaps faster than it should, but be that as it may it means that the farmers of my constituency are paying a tax of $40,000 yearly for fertilizers, and if they do not pay it to the customs house they pay it to the man who compounds the mixture. To show that there is no protection necessary I need only point out that the manufacturer or the compounder of commercial fertilizers in the maritime provinces sells as much of his commodity in the state of Maine as he does in New Brunswick. The last day I was at home a gentleman came to my office and asked me if there was not some way by which he could have the thing arranged so that he could buy a certain grade of fertilizer in the state of Maine

which was manufactured in New Brunswick, and bring it back to Canada without paying duty. He took the ground that it being a Canadian product he should have the right to bring it in from the United States free of duty, because as he said:	here is an
article manufactured not a hundred miles from where I live, then exported to the United States, and if I could go across to the United States and buy it and bring it back I could buy it for four dollars a ton cheaper than I could in Canada. I feel diffident about asking the Minister of Finance to depart from the principle which he feels like following, but I would point out that in this campaign of patriotism and production nothing is more important than the entire remission of the duty on fertilizers.


John Dowsley Reid: What is it worth per ton?


Frank Broadstreet Carvell: It is worth from $40 to $42, and I fear we will have to pay a little more for it this year and get a much poorer grade as we cannot obtain our potashes
from Germany.


John Douglas Hazen: Is it sold on analysis?


Frank Broadstreet Carvell: Yes, under the Fertilizers
Act passed here some six or seven years ago the manufacturer must stamp upon every package the analysis, and the farmer is sufficient of a chemist to know the grade of mixture required for the different crops. I am not going to labour the point, but I only say again that I have tried to show the minister the enormous importance of this question of fertilizers to my own constituency. I am prepared to narrow it down to that, but what is true of my constituency is true of many other parts of New Brunswick. I am satisfied that the entire reduction in this duty would save my farmers $40,000 a year, and would not hurt the manufacturers of fertilizers at all, for a large portion of their output is being sold to the United States at $3 or $4 a ton less than it is sold for to our farmers.
Mr. A. IC. MACLEAN: Would the minister tell us what loss of revenue he anticipates from adding bananas to the exempted articles?


William Thomas White: I am unable to say offhand, but I do not think it is a very considerable amount.


Wilfrid Laurier: There is a large importation of bananas.


William Thomas White: But on that importation the tax would not produce a very considerable

amount of revenue. The representations made to us by the government of Jamaica were of such a character that we thought we should have regard to them. The tax of 7i per cent would amount to about three or four cents a bunch of, say, eight dozen bananas. There is a feature of "it that is worthy of consideration, but was not the determinating factor with us, and that is that the business is conducted upon a pretty narrow margin of profit from the importer through the wholesaler to the vendor. The [DOT] revenue, in my judgment, was not sufficiently large to have induced us to change except upon the representations made.


Wilfrid Laurier: My information is that the loss of revenue through this remission of duty will be very large.
I do not object to the change; on the contrary, I think it is a wise move not to collect a duty on bananas. They have become an important article of food, especially in the summer time, and on the part of the poorer class. If the figures which I have in my hands are correct the loss of revenue by putting them on the free list would be $2,000,000. That is the statement in the memorial furnished me by fruit importers:
It is estimated by those responsible for the tax that it would give the Government possibly $2,000,000 annually in revenue. These figures are based on the 44,000,000 bunches of bananas imported last year.
However, we all agree that the tax should be removed, and I have nothing more to say on the point. But I would like to take up, one by one, the different items the hon. gentleman has brought up, so that I may understand exactly where we are in this respect. We are all familiar with the resolutions brought down by my hon. friend; we have had them before us for five weeks. But to-day he has brought m a list of changes. The first of these is wild edible berries when imported from Newfoundland. I do not know whether it is worth while to discuss this matter, but I should like to know what that means. Berries are an article of diet, and it would be for the benefit of the consumer to have them admitted free. The use of fresh fruit is so important that I am sure no one will raise objection to this change. The minister stated that these were partridge berries. Are these the only berries that would come from Newfoundland? And can he tell us what the partridge berry is? In my province we know as partridge berry a small berry that grows in a bunch on a plant found in the forest.


William Thomas White: I understand that the Scandinavians in Winnipeg are very desirous of getting these berries. I would not have introduced the amendment but that we were requested to make it by the government of Newfoundland, and it seemed a gracious thing to do. I would say that instead of the $2,000,000 being the expected revenue on bananas, had the change not been made, it would have been $200,000. Of course, I have no doubt that the right hon. gentleman has correctly read the memorial, but there is an error in the figures.


Bowman Brown Law: I think that the partridge berries referred to are known in other places as the fox berry. They are similar to the Nova Scotia cranberries, but have a flavour of their own. Considerable quantities of them are imported into Halifax.


Wilfrid Laurier: The next article is silk.


William Thomas White: Woven labels manufactured in silk come within the terms of the French treaty, and so it was not open to us to impose the duty of 7* per cent and 5 per cent upon these labels. But the war taxation as we proposed it applied to silk in the gum and spun silk. Therefore, had I not made these changes, the Canadian manufacturer of woven silk labels would have been called upon to pay a duty upon his raw material without any compensating duty upon the finished product entering into competition with him from France. So we have placed silk in the gum and spun silk imported for this manufacture in the list of exemptions.


Wilfrid Laurier: I am not objecting, but I should like to know where that will lead us. The only article of the French treaty relating to silk is the last article in schedule (c) " manufactures of silk or of which silk is a component part."


William Thomas White: That would not cover this point, my hon. friend will observe.


Wilfrid Laurier: Exactly, but my hon. friend exempts only silk in the gum, because, he says, it comes under the provisions of the French treaty. Are not all articles of silk affected by the French treaty? Under the proposed tariff all articles of silk will be taxed 7J per cent; therefore the question arises as to whether or not we can increase duties upon articles which are mentioned in the French treaty.


William Thomas White: Some articles of silk, such as sewing and embroidery silk and silk underwear, do not come under the provisions of the French treaty. I understand that silk in the gum and spun silk are the only articles of silk which we need to exempt, for the reasons which I have given. Woven labels manufactured of silk come under the provisions of the French treaty; therefore, unless I place in the list of exemptions raw materials used by the Canadian manufacturer in making these silk products, he would be at a disadvantage compared with the position which he occupied before I brought down these changes.


Wilfrid Laurier: Do I understand that all articles of silk which are mentioned in the French treaty shall not be subject to the new tariff of 7J per cent?


William Thomas White: All articles enumerated in schedule C of the French treaty are exempt from the operations of the 7J and the 5 per cent tariff. The duties in schedule C are specific and it is not open to us to alter them. I said in my Budget speech that I had regard to the convention with France and to our West India agreements in the proposals which I made.


Alexander Kenneth Maclean: Upon what principle is coffee taxed and tea exempt? Is there any scientific or plausible reason for the distinction?


William Thomas White: Coffee is, no doubt, used
generally, but I think that tea is in more general use among the poorer classes of the community than coffee is. In the West more coffee is consumed per head than in the East; of course they consume both tea and coffee. But what we had in view was that tea is, so to speak, the poor man's drink and we were reluctant to impose a duty upon it unless it was absolutely necessary to do so. So far as the present taxa-
Tariff
Items.
90a. Wild edible berries, n.o.p	
118a. Squid	
209b. Nicotine sulphate	
329. Ores of metals, n.o.p	
329a. Iron ore	per ton.
2. Resolved, that it is exepdient to amend The Customs Tariff, 1907, by providing that:
(1)	There shall, in addition to the duties of Customs otherwise established by Schedule A to The Customs Tariff, 1907, and Orders in Council amending Schedule A, be levied, collected and paid upon all goods enumerated, or referred 
tion is concerned, it did not appear to us that it was necess*ary to go that far; nor have I in my mind at the present time the idea that we shall be obliged to resort to taxation upon tea. The hon. gentleman knows that in England the duty upon tea is about 16 cents a pound. We allowed it to remain free; last August we placed a duty upon coffee. I do not know whether it can be said that there is any scientific principle of differentiation.


Alexander Kenneth Maclean: Tea is the cheaper.


William Thomas White: Tea is the cheaper, and is more generally used among the poorer classes. For that reason we thought it advisable to exempt it from the operation of the new tariff.


Bowman Brown Law: What is the duty on coffee now?


William Thomas White: Last August the duty on green coffee was placed at 3 cents; corresponding changes were made in the duties on ground coffee and coffee extracts.


Wilfrid Laurier: Why are
manuscripts exempted?


William Thomas White: 
Alexander Kenneth Maclean: Has the Finance Minister classified in any way the revenue which he expects to get from the customs amendments? I should like to have a rough idea of the amounts he expects to get under the different headings.


William Thomas White: I can only deal with that in a general way. Upon the returns for the fiscal year 1914, the taxation at 5 and 7J per cent, after making allowances for the exceptions, would run to something over $30,000,000.


Alexander Kenneth Maclean: That is the whole thing, special taxation and customs?


William Thomas White: No, $30,000,000 for the taxation of 5 and 71 per cent customs; but as the revenues have fallen off, owing to the war and other causes, we have made a deduction from that amount, and, speaking from recollection, my estimate in the Budget speech was that we should raise from $20,000,000 to $25,000,000 from the imposition of the general taxation by customs duties. That would necessarily be subject to this; that it is not possible for me or any one else to foresee what the war may bring forth in the way of interruptions Of trade, trans-Atlantic or trans-Pacific trade; and in giving that estimate I qualified it, as I did my August estimate, by saying that I naturally submitted it with a great deal of diffidence, because it was not possible to forecast what the future would bring forth.


Alexander Kenneth Maclean: That is, you estimate it in the gross upon the increased ad valorem duties based upon the bulk of importations for the past year?


William Thomas White: Yes.


William Melville Martin: I should like to
ask the minister why more exceptions have not been made in the line of agricultural implements. The only exceptions are reapers, mowers and binders. As far as those items are concerned, the minister knows and the Trade and Navigation returns show that there is very little importation in any event, and if the 7J per cent duty were added the importation -would cease. There is no doubt about that. It seems to me that there is very good reason why the 71 per cent is not added to reapers,


John Dowsley Reid: Did the hon. gentleman say that there was an increase in the valuation?


William Melville Martin: I have been so informed on the very best authority.


John Dowsley Reid: I say there has been no increase in the valuation.


William Melville Martin: I must accept the minister's word, but I have been informed by implement dealers in western Canada who import these goods that the valuation of the ordinary eight-foot binder has since March 31, 1914, been increased by $22.


John Dowsley Reid: That is not in accordance
with the facts. Perhaps my hon. friend is referring to the case of Hutchinson, who was given an interview to some of the papers.


William Melville Martin: I am not referring to newspaper interviews at all. The information comes to me from implement dealers in the city of Regina. If the minister assures me that there has been no increase in the valuation, I must accept his statement.


John Dowsley Reid: The International Harvester Company and all the other implement manufacturers on the other side of the line submit their price-lists to the Department of Customs each year, and it is on that valuation that the customs duties are collected. The hon. member will find that an answer was given in Hansard a few days ago showing there has been no increase in any shape or form in the valuation of agricultural implements, except in the case of Hutchinson, of the John Deere Plow Company. This company was importing binders into Canada at a valuation less than the home market price in the United States. Our appraiser learned of this and brought it to the attention of the department. The valuation was made equal to the home market prices in the United States, and that did not increase the price to the farmers of

Canada, for this reason: the John Deere Company's selling price in this country is just the same as that of the International Harvester Company and of other companies. The only thing is that before we made this change the John Deere Plow Company were making a much greater profit out of their binders by having them valued at $20 to $22 less than what they should have been. I know of no other case.


William Melville Martin: Has the valuation of the John Deere Plow Company's binder been increased?


John Dowsley Reid: The price of the John Deere Plow Company's binder has been placed on the home market basis in the United States just the same as that of the International Harvester Company and other concerns. That is in accordance with the statute. The John Deere Plow Company were entering their binder at a price based on the cost of production at the factory.


William Melville Martin: At the cost price?


John Dowsley Reid: At the cost price. The International Harvester Company were paying duty on the selling price on the other side of the line, whereas the John Deere Plow Company were getting their implements in at cost price and they were making a very much larger profit than the International Harvester Company who were paying the duty on the home market price. That is the only case I know of where the valuation was raised, but it was on account of these parties undervaluing their implements contrary to the provisions of the Customs Act. If the hon. gentleman has any other case to bring to my attention I will be very glad to explain it or find out if there is any reason why he should make such a statement.


William Melville Martin: I would like to find out from the minister if the basis of valuation on agricultural implements, and, I suppose other things, is the selling price in the country of production.


John Dowsley Reid: If the hon. gentleman reads the Customs Act he will see that it provides that the valuation for customs duties shall be the price for home consumption. We get the home consumption price- from the price list that is issued to the trade throughout the country from which the goods are being exported to Canada. In the case of agricultural implements, the International Harvester Company and others have their printed price lists which they submit to

the trade and it is on that basis that we must, under the law, collect the duty.


William Melville Martin: I have seen some of the price lists of the implement companies and in them are set forth the price that they charge what you might call the jobber and also the retail price at which the jobber sells to the' consumer. Is the price on which the duty is collected at the boundary the list price at which the company sells to the jobber or the price at which the jobber sells to the farmer in the United States?


John Dowsley Reid: The duty is collected on the
wholesale price as set forth in the price list, say, of the International Harvester Company. That is if they are selling to a concern in Canada. Suppose they were selling a carload of binders to a firm in Regina, they would invoice that carload at these prices and we would collect the duty on them. If they were to sell a carload to some concern in the United States and that firm retailed them out, the duty would be collected on the price at which the last sale was made if there was one binder brought in. If any person at Regina or any other place in the West were to buy from the International Harvester Company at the wholesale price wherever the goods are manufactured that would be the valuation upon which duty would be collected by the Customs Department.


William Melville Martin: Then the situation is just about wh t I thought it was. The duty is charged on the invoice price to the importer in western Canada. That being the provision I can readily understand how the difference in rue price of implements exists in the province of Saskatchewan as compared with the price in the states immediately south of that province. The same situation occurs in Manitoba and Alberta. I had a good opportunity last summer to investigate the question of the relative price of implements in the southern part of Saskatchewan, or in any part of Saskatchewan, and in the- states of the American Union bordering on Canada. From the information I got last summer, this information being in the form of sworn evidence given before a commission, I know it to be absolutely the case, and I do not think there is a single exception to what I say, that the prices of implements, wagons and all kinds of things used by the farmers in the province of Saskatchewan are from 15 to 20 per cent higher than they are in the states of North 74*
Dakota, Minnesota and other states immediately adjoining Canada. I remember last year reading in Hansard-I was not here when the debate occurred-


Mr. W. H. SHARPE:: Does my hon.
friend refer to binders as well?


William Melville Martin: Binders as well.


William Henry Sharpe: My hon. friend is mistaken.


William Melville Martin: I have evidence on the
question. Last summer farmers came before the Implement Commission appointed by the Saskatchewn Government and gave evidence to the effect that the prices that they had paid for 8-foot and 6-foot binders in the states from which they had come and evidence of the prices which they had paid for International Harvesters, John Deere and Massey-Harris binders in the province of Saskatchewan. That evidence was given before a commission appointed by the Government of Saskatchewan for the purpose of investigating certain things in connection with the sale of agricultural implements. It is true that, the question of price was not the question: that was primarily brought before the commission but in almost every case, particularly in southern Saskatchewan, where a farmer came before that commission his first statement, particularly if he were a man who had come from the United States, was that the price of implements was far higher in Saskatchewan than it had been in the states bordering upon Canada. From the province of Ontario farmers gave evidence in regard to the comparative prices in Ontario and Saskatchewan, the prices in Saskatchewan being higher. That may be perfectly justifiable from the manufacturers' standpoint because we must pay freight on these binders, or whatever the machinery may be, from the point of manufacture in Ontario to the point of delivery in Western Canada and there must be some difference in price there. It is absolutely beyond doubt that there is a remarkable difference between the prices of implements in Saskatchewan and in the states to the south of the boundary line. My hon. friend from Lisgar (Mr. Sharpe) knows that that is the (case in respect to the province of Manitoba. It is absolutely true that the prices of implements in Saskatchewan, Manitoba and Alberta are, without any exceptions that I know of, higher by from 15 to 20 per cent than the same implements sell for in the states of the American Union immediately adjoining Canada.


William Henry Sharpe: I do not know anything of the kind. I know that the prices in North Dakota are very little less than they are in Manitoba.


William Melville Martin: They are a little less?


William Henry Sharpe: They are a little lessnot 5 per cent.


William Melville Martin: That is the only case
that my hon. friend can mention where the price comes anywhere near approximating the price charged in Manitoba. These articles come to mind in connection with the tariff on agricultural implements. We had this afternoon a statement from the Minister of Finance in respect to fertilizers. In Saskatchewan and in the other western provinces we do not use fertilizer to any great extent. At the same time, fertilizer is a very important thing to farmers in certain portions of Ontario, Quebec, Nova Scotia and New Brunswick and agricultural implements, as far as the provinces of Saskatchewan and the other western provinces are concerned, are just as important to the farmers there as fertilizers are to the farmers of eastern Canada. If the Minister of Finance is justified in taking the duty off fertilizers for the benefit of the farmers of eastern Canada, why is he not justified in allowing the tariff to remain as it is at present on agricultural implements for the benefit of the farmers of western Canada? The patriotism and production campaign has been conducted chiefly in western Canada. There has been more talk about it in western Canada in so far as the production of wheat is concerned than in any other part of the Dominion. In western Canada, no matter whether we live in cities or towns, or in the country, we know that we are absolutely dependent for our success in the future on the success of the farming population.
We have not at the present time many manufacturing institutions in Regina, but the time may come when we shall, and I have no doubt the people of western Canada would be willing to extend to them a certain amount of consideration in the way of tariff. It appears to me that the Minister of Finance is not treating the farmers of western Canada fairly when he increases the duty on agricultural implements 7J per cent. This is a case where, in my opinion, exception might very well be made, as was made in the case of fertilizers. Excluding mowers, reapers, and binders, which pay a duty of 121 per cent, I find from the Trade and Navigation re-
[Mr. W. M. Martin. 1
turns that on the implements imported into Canada last year the duties ranged from 171 per cent to as high as 29-17 per cent.


William Henry Sharpe: Were many mow'ers, reapers, and binders imported into Canada last year ?


William Melville Martin: The number of mowers imported was small. Of reapers during the year 1913-14, only $38,000 worth was imported, and the duty paid was $6,702 or 171 per cent. There was imported $.336,675 worth of binders, on which the duty paid was $58,918 or 171 per cent. But on a large number of agricultural implements, which are used pretty nearly as much as mowers, reapers and binders, the duty paid ranged from 171 per cent to 29-17 per cent. If you add 71 per cent to this you will have a duty ranging from 25 per cent to 321 per cent, which i>s a fairly large tax on implements that are used by every farmer. In the case of a number of these implements there is practically no importation, so that the Minister of Finance will have no results if he has increased the duty on them for the purpose of raising revenue. I have never had very much objection to a tariff imposed from the standpoint of raising a revenue. It has been stated throughout this debate that the Liberal party has always stood for free trade; you will find free traders in the Liberal party, and in western Canada you will find free traders in the Conservative party. Some hon. members	on the	other	side
have accused me of attempting to raise issues between the East and the West, but I declare	here that
I have never adopted such a course. I have on several occasions stated that I believe in a tariff for revenue purposes, but that I did not believe in imposing a tariff from the standpoint of protection. I believe that the present tariff on agricultural implements, with this increase of 71 per cent, is a protective tariff. I also stated in this House some years ago that the proper way to frame a tariff was to pick out a large number of the items consumed by every man, woman and child in this country, put them on the free list, and then tax the luxuries. Under this rule agricultural implements would be placed on the free list. I have no objection to the Minister of Finance taxing automobiles as high as he wants to, and the duty on automobiles under this tariff will be 42 j per cent. If a man can afford to pay $2,500 for an automobile, he can pay a few hundred dollars more in duty or he should not want the

machine. I submit to the Minister of Finance that to do as he has done, namely, to take every article consumed by the farmers and by the labouring people, or used in their daily avocations, and to place an increase of 7) per cent duty on these articles, is not a scientific way to create a tariff. It certainly is not done with a view to placing the burden where it belongs; it is putting the burden on the agriculturist and on the working man who are least able to bear it. As I have said, there are a large number of agricultural implements which at the present time are not imported because of the high tariff, and to place an extra tariff of 71 per cent on them will certainly not bring in any revenue. I appeal to the Minister of Finance to leave the tax on agricultural implements as it was before this new tariff was brought down.


William Thomas White: I agree with the hon. member for Regina (Mr. W. M. Martin) that it is undesirable that we should discuss at this stage and at this time the general question of the duty upon agricultural implements. While it is probably true that fertilizers are not of much importance in the prairie provinces, yet they may become so in the future. My hon. friend will admit that mowing machines, harvesters, selfbinders and reapers are of probably more importance to the West than to the other sections of Canada, but he has overlooked the fact that in imposing an increase to the general and British preferential tariff upon practically the whole range of goods covered by our fiscal legislation, we have allowed reapers, and binders, and harvesters to remain at the rate of 121 per cent, to which they were reduced by this Government last year, the previous rate of duty having been 174 Per cent. I have on former occasions dealt with this question of the duty on agricultural implements quite frankly, and if my hon. friend will look at my remarks on the subject during the last regular session of this House, he will have my views. I looked into the question very carefully at the time, and I set forth my opinion with regard to the propriety of the tariff upon the facts of the investigations which I had made. My. lion, friend knows that there is a general drawback in respect of duties paid by manufacturers upon exported goods, and that with regard to reapers, binders and mowers there is in addition to that a drawback upon duties paid upon articles which are manufactured for domestic use in Canada. Therefore, this year, by reason of preserving that drawback I was enabled to leave the
duty on harvesters, reapers, binders and mowers at 124 per cent to which it had been reduced last year. As to the other range of agricultural implements to which the hon. gentleman calls attention, he is no doubt aware that there is no drawback to their manufacturers in respect of the duty they pay on raw material entering into their production in so far as the goods are sold in Canada. I pointed out in the course of the Budget debate that in approaching this question of raising additional revenue it became necessary for me to tax free goods and raw materials in order to increase our revenue. It is true, as my hon. friend has said, there are certain items in the tariff' upon which with the increase of duties we are not likely to get increases in revenue.
I calculate that, by reason of our imposing a duty upon free goods and raw materials, and also upon the finished article we shall add substantially to our revenues for the year.
Now, it follows from what I have said that, with the increase of duty upon iron, steel, lumber and other articles entering into the manufacture of the agricultural implements to which I now particularly refer, it will be obvious to my hon. friend who is acquainted with the principle of the adjustments we have to make in connection with the tariff, that the duty will have to be increased on the finished product. That was recognized by my predecessor whom I quoted last year, and it was my predecessor who gave the drawback to manufacturers on harvesters, reapers, binders and mowers of duties which they had paid on raw material entering into the products which they manufactured for home consumption. I think the differentiation between the two classes of agricultural implements will be obvious to my hon. friend. Where I was duties which they had paid on raw material not having been increased by these tariff proposals, I allowed the tariff to remain as it was. With regard to the other range of agricultural implements to which he has referred it will be obvious to him that it was necessary to increase the duties upon them by reason of the fact that we are increasing the duties on iron, steel, wood and other raw material that enter into the manufacture for home consumption. Among the-largest imports into Canada have been, those in the iron and steel schedules; and therefore it might be expected that we should derive a very substantial revenue from the imposition of these duties of 71

per cent and 5 per cent upon articles embraced in that category.
I think I have dealt sufficiently with what my hon. friend has drawn to our attention. I desire only to add that while we have left reapers, binders, mowers and harvesters at 12i per cent, we have kept binder twine on the free list as before, and also ditching-machines, of which there is no manufacture in Canada.


Frank Broadstreet Carvell: I should like to have made some observations on this subject before the minister replied to the hon. member for Regina (Mr. W. M. Martin). I endorse everything that was said by the hon. member for Regina, and would also point out to the Minister of Finance something which, perhaps, has already been *called to his attention. This question of agricultural implements is discussed wholly from the standpoint of the western farmer. But there are other classes relatively as important. They do not produce as much for export as the western farmer, but they do produce and support their families on their farms. There is just as large a population in eastern Canada supported by agriculture as in western Canada. In my own province, whose inhabitants are altogether an agricultural people, we find ourselves much hampered by this tariff. I can understand the argument of the Minister of Finance that in the case of all the agricultural implements other than those on which the tariff was reduced last year, the manufacturer has to pay duty on the raw material. Therefore, argues the hon. gentleman, the manufacturer should have a greater protection upon the finished product. I am not going to quarrel with that. But I am afraid that the minister has unduly magnified the amount which the manufacturer must pay on his raw material in order to bolster up his case for claiming the right to charge the consumer in eastern Canada the enormous prices he does. In my own province, as I have mentioned both yesterday and to-day, the great article of agriculture is potatoes. It may be that our people are wrong from an economic standpoint in going so heavily into the cultivation of potatoes. But they are doing it, and it is not within the power of myself or the Minister of Finance to interfere. They have thought the matter out, and they feel that they can make a better revenue with potatoes than with anything else.
'Mr. W. T. White.]
Now, they carry on this business in the maritime provinces on a large-scale. They have to have machines for this work. It may surprise the Minister of Finance to know how much the ordinary farmer in my constituency invests in these machines. He must have a reaper and in many cases a binder, though I realize that they are not nearly so important as in the West and also that in the East they buy a smaller machine. In addition they must have machinery to carry on their potato business and in this machinery they must invest from $300 to $400 and in some cases as much as $500. They must have, in the first place, a planter. The seed is placed in the hopper on this machine, and the machine makes the track, places the fertilizer, plants the potato and covers it up. You could never plant twenty acres of potatoes in the manner in which the Minister of Finance planted them when a boy-


William Thomas White: I planted many of
them in that way.


Frank Broadstreet Carvell: Not to the extent of
twenty acres.


William Thomas White: No.


Frank Broadstreet Carvell: If he wanted to cultivate twenty acres he could not do it with the old drill method. This potato-planter will cost the farmer about $100. Then he has to have a wheel cultivator; you cannot get along without that; and it will cost from $40 to $50. Then he must have a power-sprayer, a machine to put on the Bordeaux mixture to protect the plants from fungous diseases and the poison to get rid of the potato-bugs, and that machine will cost $120. Then he must have a digger and that will cost another $110 or $120. And on all these machines the producer of potatoes had to pay, before this new tariff was introduced twenty or twenty-five per cent. He does not usually pay the duty to the custom house-for there is very little importation and the machines are manufactured very largely in Canada. Now, take the case of a digger, which, perhaps, is the least complicated piece of machinery on a man's farm. It costs about $120-it will cost more in future. It is nothing but a heavy piece of machinery on wheels like a mowing-machine. It has a spade which goes into the ground and there is a sort of elevator concern that carries the potatoes up, riddles the load and throws out the potato in one place and the earth in the

other. The machine, weighs probably 500 pounds.
I suppose the iron in a potato digger would not cost the manufacturer more than $10. The duty upon that iron would be $2 or $3, which would represent the total tax paid by the manufacturer upon that article. The manufacturer has under present conditions a protection of 25 per cent upon that potato digger, which costs the consumer $110. My hon. friend is now making him pay 74 percent more, so that he will have to pay 32J per cent on it if he imports it and 324 per cent protection if he does not,-and this for an article without which he cannot possibly carry on the work of his faTm. What applies to potato diggers applies also to sprayers, planters, cultivators. I do not understand why the minister reduces the duty upon mowers, reapers and binders down to 124 per cent and leaves the duty on these articles which I have mentioned at from 20 to 25 per cent. We are all desirous that production should be increased; on this point hon. gentlemen opposite are as sincere as we are and we are as sincere as they at a time when we are trying to stimulate production, why should there be imposed upon these articles a tax so high that the farmer of the maritime provinces will find it difficult to go on doing business? By the imposition of this tax you are adding $30 or $40 to the amount which the farmer will have to pay upon the machinery which he must purchase in order to carry on his work. What is true of the articles which I have mentioned is also true of other articles which the farmer must use on his farm: ploughs, wagons and things of that kind, which have been referred to by the hon. member for Regina. I do not feel that I would be doing justice to myself, to my constituents or to my province if I were to allow this discussion to go by without pointing out to my hon. friend the great injustice of these proposed duties. I give him credit for reducing the duty upon fertilizers down to the point where it was before this tariff was introduced; I am sorry that he could not see his way clear to make it free. Having admitted the necessity for making as easy as possible the conditions under which the agriculturists of this country must work, so far as fertilizer is concerned, why should he not withdraw the operation of this tariff from all the other agricultural implements, no matter what they may be ? If 124 per cent is a sufficient protection for the manufacturers on mowers, binders and reapers, I do not see why 20 or 25 per cent should
not be sufficient iso far as other classes of machinery are concerned. But my hon. friend is not satisfied with the duty of 20 or 25 per cent; he is adding 74 per cent to that. It is unreasonable; it is illogical. It is simply hitting a man in the back; it is giving him no opportunity of defending himself; it is putting him at the mercy of the Canadian manufacturer, who will in every case make him pay the difference. The machines which I am talking about are manufactured in the United States in very large quantities; up to three or four years ago practically all these articles were imported. The Canadian manufacturers are now producing them at a price sufficiently low not to necessitate their being imported from the United States. They are getting the business, but they are getting practically the whole of the protection. I do not know whether or not I have succeeded in convincing my hon. friend to -a sufficient extent to induce him to remove this extra duty, but surely I have convinced him that it ought to be done. And if he is convinced that it ought to be done, I indulge in the hope that my hon. friend will, even as he has refrained from applying this extra duty to mowers, reapers and binders, remove the additional taxes from the other agricultural implements to which I have referred.
Resolutions reported.
On motion of Hon. W. T. White, the House went into Committee to consider the following proposed resolutions, Mr. Sevigny in the Chair:
Resolved, That it is expedient to provide:
1.	That each bank to which the Bank Act applies, exclusive of banks in the course of winding-up, shall pay for Consolidated Revenue Fund quarterly a tax equal to one-fourth of one per cent upon the average amount of the notes of the b-.nk in circulation during the three months preceding, the greatest amount of notes in circulation at any time during each of the three months being the basis of the average, provided, however, that where the greatest amount of notes in circulation exceeds the amount of the paid-up capital then an amount equal to the paid-up capital shall be the basis used in calculating the average;
2.	That every loan and trust company incorporated under any legislative authority, including the banks subject to the Quebec Savings Banks Act, 1913, shall pay for Consolidated Revenue Fund a tax of one per cent, upon the gross amount of
(a)	interest, the property of the company, from loans and investments in Canada and
(b)	income, other than interest, on business transacted within Canada received by the company on and after the first day of January, 1915 ;
3.	That every insurance company other than life and marine companies, fraternal benefit

societies and purely mutual companies shall pay for Consolidated Revenue Fund a tax of one per cent upon the net premiums received by the company in Canada on and after the first day of January, 1915 ;
4.	That every cable and telegraph company shall pay for Consolidated Revenue Fund a sum equal to one cent upon each despatch or message other than press despatches or messages originating at the offices of the company in Canada and transmitted thence over the company's lines for which a charge of fifteen cents or more was imposed, the company having the right to charge the one cent to and collect the same from the person paying or liable to pay the regular charges for the transmission of the despatch or message;
5.	That every purchaser of
(a)	a ticket or right entitling the purchaser to transportation over a railway to any place in or outside of Canada;
(b)	a ticket or right entitling the purchaser to transportation by vessel between ports or places in Canada or from a port or place in Canada to a port or place in Newfoundland, the West Indies, Bermuda, British Guiana, British Honduras or the United States;
(c)	a ticket or right entitling the purchaser to transportation over a railway and by vessel to a -port or place in Canada, Newfoundland, the West Indies, Bermuda, British Guiana, British Honduras or the United States, whether such transportation he by railway and vessel, or by vessel and railway, or by railway, vessel and railway;
shall, in addition to the regular charge for the ticket or right, pay to the person selling the ticket or right, for the Consolidated Revenue Fund, in respect of a ticket or right costing

(i) over one dollar and not more than five dollars, five cents;
(ii) over five dollars-for each five dollars and in addition for any fractional part of five dollars, five cents;
6.	That every purchaser of a berth in a sleeping car or seat in a parlour car shall, in addition to the regular charge for the berth or seat, pay to the person selling the berth or seat for the Consolidated Revenue Fund-
(a)	ten cents in respect of each berth bought;
(b)	five cents in respect of each seat bought;
7.	That every purchaser of a ticket or right entitling the purchaser, either with or without intervening transportation, to transportation by vessel from a port or place either in or outside of Canada to a port or place outside of Canada other than in Newfoundland, the West Indies, Bermuda, British Guiana, British Honduras or the United States shall, in addition to the regular charge for the ticket or right, pay in respect of the transportation by vessel to the person selling the ticket or right for the Consolidated Revenue Fund-*
(a)	the sum of one dollar if the amount chargeable for such transportation by vessel exceeds ten dollars;
(b)	the sum of three dollars if the amount chargeable for such transportation by vessel exceeds forty dollars;
(c)	the sum of five dollars if the amount chargeable for such transportation by vessel exceeds sixty-five dollars;
8.	That no person shall issue a cheque payable at or by a bank unless there is affixed thereto an adhesive stamp, or unless there is impressed thereon by means of a die, a stamp of the value of two cents;

9.	That no person shall transfer a bill of exchange or promissory note to a bank in such manner as to constitute the bank the holder thereof or deliver a bill of exchange or promissory note to a bank for collection unless there is affixed thereto an adhesive stamp, or unless there is impressed thereon by means of a die, a stamp of the value of two cents;
10.	That no person shall sign a receipt for money paid to him by a bank chargeable against a deposit of money in the bank to. his credit until he has affixed to the receipt an adhesive stamp, or unless there is impressed thereon by means of a die, a stamp of the value of two cents;
11.	That no cheque or other bill of exchange shall be issued or paid by a bank unless there is affixed thereto an adhesive stamp, or impressed thereon by means of a die, a stamp of the value of two cents ;
12.	That every bank having in possession in Canada, any promissory note, cheque or other bill of exchange made or drawn out of Canada on which a stamp has not been affixed or impressed shall, before payment or presentment for payment, if the same is payable In Canada, affix thereto an adhesive stamp of the value of two cents and the value of the stamp so affixed shall be payable to the bank by the person entitled to the proceeds of the note, cheque or bill;
13.	That every express company carrying on business in Canada, shall, before the issue of a money order or traveller's cheque, affix thereto a stamp of the value of two cents chargeable to the purchaser of the order or cheque or to the payee thereof;
14.	That no money order or postal note shall be issued under the provisions of the Post Office Act until there is affixed thereto a postage stamp of the value of two cents and one cent respectively to be paid for by the purchaser of the order or postal note, and upon such stamp there may be printed or impressed the words " war tax '';
15.	That on every letter and post card for transmission by post a tax of one cent shall be levied and collected, such tax to be payable by affixing to the letter or card a postage stamp of that denomination, upon which there may bo printed or impressed the words " war tax " ;
16.	That every person by whom goods are received-
(a)	to be exported or carried coastwise, or
(b)	to be transported by railway,
shall in every case in which a charge for freight of expressage exceeding five cents is made attach to the bill of lading or other evidence of receipt a stamp to be furnished by the shipper or consignor of the value of two cents;
17.	That every person selling to a consumer a bottle or package containing
(a)	a proprietary or patent medicine,
(b)	perfumery,
(c)	wine, non-sparkling,
(d)	champagne or sparkling wine,
shall affix to every such bottle or package a stamp of the value hereinafter set out :
Stamp of
Article.	the
value of
(a) A proprietary or patent medicine,
(b) Perfumery,
The retail price for each bottle or package thereof being- twenty-five cents or less	1 cent.

Article.
Stamp of the
value of
More than twenty-five cents-
For each twenty-five cents and in addition for any fractional part of twenty-five cents	1 cent.
(c)	Wine of the grape, non-sparkling,
each bottle or package containing-
One pint or less	3	cents.
One quart or less, but more than
one pint	5	cents.
A quantity greater than one quart-[DOT]
For each quart and in addition for any fractional part of a quart	3	cents.
(d)	Champagne or sparkling wine, each
bottle or package containing-
One-half pint or less	13	cents.
One pint or less but more than
one-half pint	25	cents.
A quantity greater than one pint-
For each pint and in addition for
any fractional part of a pint..25 cents.
18. That the provisions of any Act founded on these resolutions in so far as such provisions relate to wine, non-sparkling, champagne and sparkling wine, shall be deemed to have come into force on the twelfth day of February, 1915.


William Thomas White: Certain modifications have been introduced in the resolution of which I gave notice, relating to the special taxation referred to in the Budget. They are as follows:
Purely mutual insurance companies are exempted from the tax of X per cent upon net premiums. There are agricultural insurance companies of a purely mutual character; we are exempting them from the special taxation.


William Pugsley: Mutual fire insurance companies ?


William Thomas White: Purely mutual fire insurance companies.
Press despatches are exempted from the one-cent charge payable on messages sent by cable and telegraph companies'.
Steamship tickets on Atlantic seaboard. The one per cent charge on the cost of such tickets is enlarged to include all^ the West India islands instead of the British colonies in the West Indies, as stated in the resolution of which I gave notice. British Honduras has also been added.
Ocean passenger tickets. By the resolutions referred to in the Budget, an ocean passenger ticket costing $30 was subject to a tax of $3. By the new resolution the $30 has been increased to $40. By the first resolution an ocean ticket costing $60 was subject to a tax of $5. The $60 has been increased by the new resolution to $65. I shall explain the reason for that later on.
Promissory notes. Promissory notes, dis-. counted or sent for collection through a bank, are made subject by the new resolution to the stamp tax of two cents. Promissory notes were not made subject to the new tax along with cheques and bills of exchange by the first resolution.
Patent medicines and perfumery. The stamp tax of one cent on each 10 cents of retail value has been changed in the new resolutions to one cent on each 25 cents worth of retail value, a reduction from 10 per cent to 4 per cent.	-
Wines, non sparkling. By the first resolution, each one quart or less was subject to five cents stamp tax. That is changed by the new resolution so that a pint or less should have a stamp of only three cents.
Champagne. By the first resolution, each pint or less was to bear a stamp tax of 25 cents. That is changed so that a half pint or less shall pay only 13 cents. There are half pints of champagne which are not especially referred to in the first resolutions.
These are the changes which are embodied in the new resolutions which I shall now hand to the chairman.


Alexander Kenneth Maclean: By which section is the promissory note added as being taxable, section 8?


William Thomas White: When I had under consideration the resolutions relating to the stamp tax on bills of exchange. I considered also the question of imposing a stamp tax on promissory notes. It occurred to me at the time it would be undesirable that that should be done because promissory notes are very common instruments passing between individuals in all parts of the Dominion, and it would be difficult to institute a system of taxation on such promissory notes. We therefore determined that we would limit the taxation of two cents imposed by stamp tax to bills of exchange negotiated through a bank and to cheques. It has been pointed out to us, and we recognized the force of the statements made, that the Act could be evaded so far as it related to bills of exchange negotiated through banks unless the taxation were also imposed upon promissory notes negotiated at or through banks.


Frank Broadstreet Carvell: This would be an increase?


William Thomas White: Yes, and if desired I can let this stand as a notice of motion until to-morrow.


Charles Marcil: Will the man who makes out the cheque have to put on the stamp or the bank?


William Thomas White: The maker of the cheque is obliged to put it on, but if he does not the duty is imposed on the bank of seeing that it is put on.


Charles Marcil: A special stamp will be provided for the purpose?


William Thomas White: Yes.


Bowman Brown Law: Do I understand that a note passing between individuals which, does not go through a bank does not need to have the stamp on it?


William Thomas White: No, we have omitted those.


Bowman Brown Law: And bills of exchange the same way?


William Thomas White: Bills of exchange between individuals, but to bills of exchange negotiated through a bank the stamp applies.


William Pugsley: The minister has announced some changes in the resolution. Would he be good enough to explain why life and marine insurance companies were excepted? Clause 3 provides that every insurance company other than life and marine companies and fraternal benefit societies shall pay a tax. I could understand why fraternal benefit societies might very well be excepted, but why life and marine companies should be exempted and fire insurance companies be obliged 9 p.m. to pay, I am not quite able to understand.


William Thomas White: I had a much larger range of companies under consideration for special taxation than appeared in the resolutions now before the Committee. I considered very carefully the question of imposing a tax on life insurance companies, and discussed it with our Insurance Department very fully. My hon. friend is aware that there are fraternal benefit societies, and it did not appear desirable that they should be taxed because the taxation would fall upon their policy-holders. That is also true in the case of the life insurance companies carrying on an ordinary business, because there is a division of profit. My hon. friend knows that there are charges loaded upon the policies. And then there are mutual life insurance companies. It did not appear to me, giving the matter the best consideration of which I was capable, that it would be advisable that this tax-
ation should fall in any substantial measures upon the policy-holders of life insurance companies, because life insurance is a matter of such extreme importance to the individual and to his family. It seemed to me that we might very properly differentiate in our taxation in favour of the policy-holders of life insurance companies. The Superintendent of Insurance reports without any hesitation that any taxation that might be imposed upon life insurance will be borne by the policyholder, and it is his view, and it is mine, that the policy-holders of the companies should not be burdened with taxation in making provision for 'their dependents.
Whether those are good reasons it is for the committee to judge. But it appeared to me that, having regard to these and some other considerations that are obvious and anala-gous to those I have mentioned, it would be advisable to exempt life insurance companies from this taxation.


Wilfrid Laurier: Does not that apply to all these taxes?
Mr. W'HITE: Not in the same degree, I think. Legislation has specially recognized that life insurance policies are a class of property different from other property. For example, under provincial legislation, and I think Dominion, it is possible for one to declare a trust or to make a policy payable without consideration to a dependent or to his family, and the law will not set that aside at the instance of any creditor. So that life insurance policies have been regarded as a class of property different from other property; I think for the reason of the dependence of a man's family upon his life insurailce policy. Whether that appeals to the committee or not it is for them to say. But, in the opinion of the Superintendent of Insurance, these taxes will fall on the policy-holders and upon a man's dependents, and as all classes of the community are interested in life insurance, we thought it inadvisable to impose this tax.


Wilfrid Laurier: There is a great deal of force in the views presented by my hon. friend. If there is a class of property that ought to be sacred, it is certainly an insurance policy. An insurance policy is a sort of a trust. For instance, a young man going into business sets aside a certain portion of his earnings every year for the possible contingency that the insurance may be paid to his family. There is no more sacred trust, and I should be sorry for us to do anything here to impair the

value of that trust. But, take the ordinary stock companies, not the mutual companies. Take the Canada Life, for instance, or the Sun Life and other companies that earn a very large income. I do not know what rate of dividend they pay to their shareholders, but I imagine it must be pretty high. Is it not possible that the profits which are accumulated and go to the shareholders might just as well be subject to taxation as the profits of the banks or trust companies, or of any other dividend earning company?
I can see no reason at present why this should not apply to insurance companies.


Mr. R. B. BENNETT:: With the view that, has just been expressed by the right hon. gentleman I entirely agree. I had occasion to look into that matter the other day and, while the profits of life insurance companies arise from several sources, I think the nonprofit bearing policies should probably not be subject to this tax; for a non-profit bearing policy is merely a contract between the insurance company and the insured by which for a definite premium the company undertakes to pay under 'certain contingencies a fixed sum. But with policies that earn so-called profits the company not only accumulates large sums of money by reason of the loading of the premiums based upon the expectation of life tables, but it also makes large sums of money from the investment of its surplus funds, and while in theory some portion of its surplus funds belongs to the policy-holders and is distributed sometimes annually, sometimes quinquennially, and sometimes at other intervals, nevertheless the owners of the company are in complete control and dominate those profits; and there is no reason why they should not pay something to the revenue of this country at this time, just as much as something should be contributed from the accumulated profits of banks or trust companies. I think the" tax should certainly apply to joint stock companies such as the Sun Life, the Canada Life, the Confederation Life and the Great West, which have a paid up capital stock and an accumulated surplus representing in some instances many times what their paid up capital stock is.
There is another matter to be kept in mind, and which perhaps may militate somewhat against the views I have expressed, and perhaps the Minister of Finance had this in mind. I refer to the enormous taxes that have been imposed on these companies by the provinces. It was only yesterday I think that Mr. Justice
Middleton gave his decision that the taxes in Ontario were intra vires. It had been alleged that it was a direct tax which could not be enforced by the province. That was one of the grounds, and I need not discuss the others, but it was held competent for the province to pass that legislation. And that involves the consideration up to what point this taxation can be carried without necessitating a revision of the contracts that exist between the companies and the policy-holders. I think that is well worthy of the consideration of the Finance Minister before we finally settle this matter. The shares of some of these large life insurance companies are selling on the market at $300, and in one instance the price was $321 for a hundred dollar share.


William Pugsley: I am not able to see why these life insurance companies should not pay a contribution to the treasury under the present circumstances. It must be borne in mind that the tax, alleged to be a war tax, ds imposed under circumstances which the Finance Minister thinks justify the imposition of this burden, and the allegation is made that it is placed on all the people of Canada so that each one may contribute something towards the revenue. Take the case of fire insurance companies. They can change their rates every year, and I venture to say that if this tax is continued for any length of time they will take it out of their policy-holders by a little increase in the premiums. They know how to do that. The banks know how to take it out of their customers. If they are obliged to pay a tax they add a percentage to the rate of interest which they charge. In the end the bulk of these taxes will come out of the people who transact business with these large financial institutions. Life insurance companies doing business in Canada give evidence that they are making a great deal more money than fire insurance companies. On the whole, fire insurance in Canada has not been a profitable business for some years past; but life insurance has on the whole been exceedingly profitable.
Mr. R. B. BENNETT. Most profitable.


William Pugsley: Go to the great cities of Canada, Montreal, Toronto, Winnipeg, Hamilton or Vancouver, and you will find great buildings towering to the sky almost, owned by life insurance companies; magnificent buildings used not only by the life insurance companies themselves, but rented out for office purposes, from which they derive a large revenue. The business

done by life insurance companies in Canada is enormous. I have the figures for 1913 showing that the net amount of life insurance in force in Canada was $1,168,590,027. Of that the insurance carried by Canadian companies was $750,637,902; by British and Colonial companies, $58,176,795; and the balance by United States companies doing business in Canada, and remember that would include such great companies as the Equitable, the Mutual Life, the New York Life, the Prudential and other companies whose assets are counted in hundreds of millions of dollars.
Yet under this Bill these great and wealthy companies are allowed to go scot free while the taxes are being imposed upon fire insurance companies. If the premium rate on fire insurance is increased it strikes most people just as hard as it would strike them if a small amount were taken away from the profits divided amongst the policy-holders of the life insurance companies.


Richard Bedford Bennett: It would not strike them any harder than it does in the case of fire insurance companies.


William Pugsley: 
John Douglas Hazen: Do these figures include
the mutual companies?


William Pugsley: They include the mutual companies as well.


John Douglas Hazen: Companies like the Independent Order of Foresters?
AH. PUGSLEY: Yes.


William Findlay Maclean: Not the Foresters.


Edward Walter Nesbitt: They do not include
benevolent societies.


William Pugsley: I presume that is so.


Richard Bedford Bennett: They include all companies that come under the Insurance Act.


William Pugsley: The tax proposed is one per cent on the net premiums received.
If a tax were imposed upon premiums ag-[Mr. Pugsle'-1
gregating $38,641,206 it would give about $380,000 of additional revenue.


John Douglas Hazen: Do I understand the hon. gentleman to say that that would include the Independent Order of Foresters?


William Pugsley: I presume it would, but I assume that insurance carried by the fraternal companies would be only a small percentage. Take the fire companies; the fire policies in force in 1913 aggregate $2,925,200,553 and the premium paid thereon $35,347,139. The premiums received by the life insurance companies in 1913 were about $3,000,000 greater than the premiums collected by fire insurance companies. It does seem to me that all companies, with the exception of what may be termed purely mutual fraternal companies, ought to be subjected to this tax. If you are going to provide a tax that is to bear as far as possible upon all classes in the community, there is no possible justification for taxing fire insurance companies and exempting life insurance companies, which are, speaking in a general way much more wealthy and much more able to pay the tax than fire insurance companies are.


Edward Walter Nesbitt: With reference to the
level premiums I would like to say non-participating policies are loaded in their charges for the purpose of providing dividends for the stockholders just as much as the participating polices. The hon. member for Calgary (Air. Bennett) is quite right in saying that the stockholders and directors have absolute control of the question as to the amount of profits that are going to the policy-holders and the amount they shall take for themselves. The non-participating policies are loaded for this purpose.


Richard Bedford Bennett: That is in order to pay the level premium as distinguished from the natural premium.


Edward Walter Nesbitt: Yes. I would not like the committee to think that * there were many level premium mutual companies doing business in Canada. The benevolent societies are a different proposition. I did not rise to urge the imposition of a tax on life insurance companies, although I presume they could stand it, as my hon. friend from St. John (Mr. Pugsley) says, a good deal better than fire insurance companies. To my certain knowledge the large fire insurance companies have not made any money in this country for thirty years. I rose to direct the attention of my hon. friend the Alinister of Finance to the fact

that there is a large amount of fire insurance done in Canada by companies that do not pay a cent towards the maintenance of the Government in this country. They do business principally with the large corporations, and they pay no license fees. I have always contended that if we are going to license one we should license all and put all on the same basis. They are also exempt from this tax, notwithstanding the fact that they gather an enormous amount of insurance in this country. Last year they had insurance in force to the extent of $250,000,000. These companies are exempt, and I do not think it is fair that they should be exempt.


William Pugsley: They are what are called mill mutuals?


Edward Walter Nesbitt: Mill mutuals, reciprocal underwriters and various mutuals. They collect a cash premium in this country, and they are all Americans. They pay nothing. They are not corporations that pay liberally towards the upkeep of the country.


Richard Bedford Bennett: They do not even have an agent here.


Edward Walter Nesbitt: No, they pay nothing to anybody in this country. The large fire insurance companies help to a large extent in maintaining our cities. They erect fine buildings, pay enormous taxes, and are the largest purchasers of gilt-edged securities. They have to have their moneys available in case of losses, and in consequence they invest only in gilt-edged securities. They are a very great asset to the country because of the excellent premises they have and the taxes they pay towards the maintenance of the different cities.
Air. AAT. F. AIACLEAN: We are discussing an emei'gency tax, but we have raised another question as to the profit of insurance companies. These profits are very large. They have a different way of dealing with these financial corporations ini Germany which is well worthy of consideration, not in connection with an emergency tax like this, but in connection with the question of what the insurance companies ought to contribute towards the revenue of the country. The large life insurance companies make enormous profits, and, instead of sharing these profits fairly with the policy-holders, they hand them over largely to the shareholders. In Germany they make large insurance companies, banks and other corporations of this class share their profits, first, with the state, and, iri the next place, they compel them to apply excess profits to a reduction in the rates.
Eventually we will have to come to that in this country, both as regards banks and insurance companies. There is no reason why the insurance companies in Canada should not pay a percentage of their profits to the State, and be made to share their profits every year. It has been worked out in other countries, it can be worked out here. A large revenue would accrue to the State from that source, and no one can stand it so well as the shareholders who own these companies. They do not reduce rates when they could reduce rates, and they have these large profits which are ultimately held for the benefit of the shareholders. These profits should be divided with the State ox with the policy-holders, and our general insurance company law should be amended in that direction. We are taking an emergency tax from the banks on their circulation. Probably the best way to reach them in connection with a permanent form of taxation, would be to make the banks share their profits with the State, or increase the rate of interest to the depositors. My suggestion is that the Government should have in view a permanent policy in the direction I have indicated. In the meantime I agree largely with what lias been said, that probably you could get a large revenue by putting some kind of an emergency tax on these profits right away.


William Thomas White: There is a distinction between a bank and a life insurance company carrying on modern life insurance. If a bank makes certain profits as a result of its annual operations, it is open to the bank to distribute the entire sum of these profits among its shareholders, who are really the proprietors, or to carry a portion of the profits to reserve. In the case of a life insurance company, as distinct from a fire insurance company, a bank, or a general joint stock company, there is the relationship of partnership between the life insurance company and its policyholders; there is the relationship of trustee and cestui que trust except as to capital. Therefore, in my view, you should not deal with a life insurance company upon the same principle as you would deal with a bank or an institution in which that fiduciary relationship or partnership relationship does not exist, unless you are prepared to go this far:	that you are willing
to impose taxation not only upon the institution in so far as it is owned by its shareholders, but also upon the policy-

holders who are participators in its profits, who are charged with a share of the expenses, and who are, in a sense, partners in the business. It is true, as stated by my hon. friend (Mr. Pugsley), that certain life insurance companies are very large and wealthy institutions, but it is equally true that there are also many life insurance companies, especially those organized during recent years-and this also would be true of fire insurance companies-which have paid no dividends to their shareholders.


Wilfrid Laurier: Are there any companies which have paid no dividends to their shareholders?


William Thomas White: The Assistant Deputy Minister tells me there are several. My starting point is that it is not desirable to tax fraternal life insurance companies, or to tax mutual life insurance companies, or to tax ordinary life insurance companies if the burden of taxation will inevitably be shifted upon the policy-holders. This matter has engaged my most careful attention and the superintendent of insurance, who is a skilled actuary and a man whose judgment *is' entitled to great weight, says:
It has been stated that since insurance contracts of life insurance companies are made with fixed and definite premiums throughout life, which cannot be increased, any additional tax imposed must be borne by the shareholders. It must be remembered, however, that 85 per cent of the life insurance in Canada is on the participating plan under which profits realized over and above claims and expenses are distributed amongst the policy-holders. Any tax imposed upon the premiums of life insurance companies would be immediately treated as an additional expense on the business, and would, therefore, go to reduce the profits payable to policy-holders, and, therefore, to increase the net cost of insurance to those policyholders. The tax would therefore be borne by the policy-holders as truly as if the premiums they pay were immediately increased by the amount of the tax.


William Findlay Maclean: Yes, but that could be changed. You could tax the net profits of the insurance companies.


William Thomas White: They would treat that tax as part of their expenses and it would be loaded on the policy-holders.


William Findlay Maclean: But they have no right to put that load on the policy-holders.


William Thomas White: The superintendent of insurance has been engaged in the inspection and examination of insurance for many years and he says that is precisely what would happen. He says further:

It is believed to be impossible to so tax life insurance companies as to make the burden fall upon the shareholders, but that it would in every case be transferred to the policy-holders of the company.


Richard Bedford Bennett: How could that be so? Take the Canada Life Insurance Company and it is provided by statute that its dividends shall not exceed ten per cent, that is $100,000 per annum on one million dollars. The accumulated surplus which arises from the profits on investment, as well as from the loading of the premiums, amounts . to a very large sum. Why should this not pay some tax to the state?


William Thomas White: All I can do is to invoke the technical opinion of the man who is dealing with insurance companies every day.


William Findlay Maclean: Yes, under existing conditions.


William Thomas White: This gentleman says it would be loaded upon the policy-holders. In addition to that he says that no less than 85 per cent of the life insurance in Canada is on the participating plan.


William Findlay Maclean: How is that participation appropriated to policy-holders and to shareholders?


William Thomas White: By the directors who, as a matter of fact, are given that statutory authority.


William Findlay Maclean: That is where the whole trouble is; they should not have that statutory authority.


William Thomas White: That is the insurance law of this country to-day.


William Findlay Maclean: I know it, and it is
crying for reform.


William Thomas White: That may be a question for consideration but I am speaking of the situation as it exists to-day and 85 per cent of life insurance is participating and in the opinion of the Dominion Superintendent of Insurance the burden of this taxation, if we imposed it, would fall upon the policyholders. Assuming, as I have assumed, that it is not wise that we should tax policy-holders of life insurance, in view of this expert opinion of the Insurance Department and of the legislation as it is to-day I was unable to see that I would be justified in imposing a tax upon life insurance companies, and that is the reason they were exempted.
My hon. friend from North Oxford (Mr. Nesbitt) raised another question, as to un-

licensed companies. I looked carefully into that matter. My hon. friend knows that these unlicensed companies have no offices in Canada and no agents here. As he has pointed out, they are not subject to the jurisdiction of the Dominion, not being domiciled here. This matter has already been considered by this House and by the Senate. The question of taxation of premiums paid to unlicensed insurance companies was the subject of a prolonged and heated argument before the Banking and Commerce Committee of the House of Commons in 1909 and before the Banking and Commerce Committee of the Senate in 1910, the parties being, on one side the Canadian Fire Underwriters' Association representing most of the licensed insurance companies, and on the other side representatives of many large manufacturing companies. The licensed insurance companies urged either the prohibition of this unlicensed insurance or the imposition of a tax on the premiums paid to these unlicensed companies equal to the percentage of the premiums the licensed companies were called upon to pay by reason of their compliance with the Canadian Insurance Act. The rate of taxation then advocated was 15 per cent. Against this contention it was urged that the right of contracting outside of Canada for insurance in unlicensed companies was one which should not be taken from the individual in Canada, nor should such transaction be subject to taxation. It was claimed also that the difference between the rates charged by the licensed companies and those charged by the unlicensed companies for the same class of risk was much greater than could be accounted for by the expense caused by compliance with the Insurance Act, and this large difference was not satisfactorily explained. I understand that no action was taken except this-that every person in Canada effecting insurance in an unlicensed company was required to make a return to the Department of Insurance showing the amount of such insurance placed by him during the calendar year.


Edward Walter Nesbitt: My memory is that the
House of Commons passed the Senate amendment as it stands in section, 39.


William Thomas White: I was not a member of the House at that time and am not familiar with the facts. If the hon. gentleman says that that was the case I accept his statement.


Edward Walter Nesbitt: I am speaking from
memory, but I was a member of the committee.


William Thomas White: The net result was, after
the matter had been discussed in the Banking and Commerce Committee of both the House and the Senate, each individual insured in an unlicensed company was required to make the return to which I have referred.
Now, let us see whether it is possible, as my hon. friend suggests, that these companies should be covered by our special taxation measures. They are not domiciled in Canada, and I understand that the agent who arranges for the insurance is regarded as the agent of the insured and not of the insuring company. Therefore, the only way we could impose a tax would be to impose it upon the premiums paid by the individual-tax the individual instead of the company. That is a different principle from the principle which we are adopting under this Act. We are not taxing the individual who may insure with the insurance company. We are taxing the insurance companies one per cent on their net premiums. Precisely how that tax may be borne, I am unable to say. It may be absorbed in whole or in part by the company, but it is clear that the taxation is primarily against the company upon its net premium income. The other would be a tax direct against the individual, upon the premiums paid to these unlicensed companies. The two principles are not on all-fours. I speak not without a certain sympathy with the attitude of the fire insurance companies in this matter, because they are in competition with the unlicensed companies. My own view is that if the situation requires a remedy, it should be remedied in such a way that the unlicensed companies doing business here shall be brought under the jurisdiction of the Dominion Government in some way. Whether that will be done or not I am not prepared at the moment to say. But that is a matter which will engage my attention in connection with some subsequent revision of the Insurance Act. Giving the matter my best consideration for the present, I am unable to see how the provisions of this taxation measure can be made to apply to the unlicensed companies which have no offices in Canada, no agent and no domicile in Canada to bring them under the jurisdiction of the Dominion Government.


Edward Walter Nesbitt: I quite agree with the Minister of Finance. The best way to get at it is through the Insurance Act. At the same time, I would point out to the

hon. minister that since the time of the controversy of which he speaks, the companies of the Underwriters' Association have put themselves in a position to write sprinklered risks at practically the same rates as the unlicensed companies, having established a sprinkler department since that time. I must say it is absolutely unfair in this country, where we allow a certain protection even under a revenue tariff, to force the licensed companies to help to keep, up the country while the unlicensed companies that have nothing at stake can come into the country and do a great deal of the gilt-edged business and pay nothing whatever towards the up-keep of the country. I think the minister could have got at this by taxing the premiums paid by the individual. Under clause 139 of the Insurance Act the individual has to report the amount of his unlicensed * insurance. He might as well report the amount of the premium paid at the same time. It would not be more difficult to compel him to report the amount of the premium paid than to compel him to report the amount of the insurance written.


Alexander Kenneth Maclean: Of course, a great deal might be said for the taxing of some long-established insurance companies; but I think on the whole it would work an injustice to the policy-holders if life insurance companies generally were included; and I think that the minister's decision to exclude them from the provision of that clause is, on the whole, wise. I rose to suggest that, as it is improbable that we can conclude the consideration of these amendments this evening, and as we sat to a very late hour this morning, and hon. members are more or less tired, we adjourn, and in all probability it will not take very long to dispose of the resolutions.


William Thomas White: The suggestion of the hon. member is entirely agreeable to me. I move that the committee rise, report progress and ask leave to sit again, to resume to-morrow.


[Stage Direction]
Motion agreed to, and progress reported.
On motion of Mr. White, the House adjourned at 9.45 p.m.
Thursday, March 18, 1915.