FOURTH SESSION-FOURTEENTH PARLIAMENT 15-16 GEORGE V, 1925 VOLUME IV, 1925 COMPRISING THE PERIOD FROM THE TWELFTH DAY OF MAY TO THE TENTH DAY OF JUNE, 1925, INCLUSIVE BEING VOLUME CLXVIII FOR THE PERIOD 1875-1925 INDEX ISSUED IN A SEPARATE VOLUME OTTAWA F. A. ACLAND PRINTER TO THE KING'S MOST EXCELLENT MAJESTY  CANADA

[Stage Direction]
Bouse of
Commons Qebaies
[Stage Direction]
Tuesday, May 12, 1925

[Stage Direction]
Hon. CHARLES MARCIL (Bonaventure) moved that the second report of the Joint Committee on the Printing of Parliament be concurred in.
Motion agreed to.

[Stage Direction]
Hon. J. A. ROBB (Aching Minister of Finance) moved that the House go into committee to consider the following proposed resolution:
Resolved, that it is expedient to introduce a measure to provide that goods produced or manufactured in Finland shall receive treatment as favourable as that accorded to goods produced or manufactured in any foreign country so long as goods produced or manufactured in Canada enjoy in Finland the same treatment as is enjoyed by similar goods produced or manufactured in the United Kingdom, as set out in Article 23 of the Treaty of Commerce and Navigation between the United Kingdom of Great Britain and Ireland and Finland, made at Helsingfors the 14th day of December, 1923.
Mr. MEIGHEN:: Mr. Speaker, is this not
a notice of motion to go into committee tomorrow?


Mr. ROBB:: To-morrow, if my right hon.
friend insists, but I thought we might make some progress by taking it up to-day.


Arthur Meighen: Oh, it cannot be anything else.


James Alexander Robb: I move that we go into committee to-morrow on this resolution.
Motion as amended agreed to.



CANADA-NETHERLANDS CONVENTION OF COMMERCE

[Stage Direction]
Hon. J. A. ROBB (Acting Minister of Finance) moved that the House go into committee to-morrow on the following proposed resolution:
Resolved, that it is expedient to bring in a measure do provide that a certain convention of commerce dated
the eleventh day of July, 1924, entered into at Ottawa by the plenipotentiaries appointed by His Majesty and by Her Majesty the Queen of the Netherlands be approved, and to give effect to the provisions of the said convention.
Arthur Meighen: Both these resolutions
were on the order paper yesterday, and I think the day before. This notice could have been given then, and we could then have gone into committee to-day.


James Alexander Robb: The day before, I was not here.


Arthur Meighen: Somebody else could
have done it.


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the Orders of the Day:
Mr. SPEAKER:: I have the honour to inform the House that I have received the following letter:
Bury, Quebec, May 11, 1925. The Honourable Rodolphe Lemieux, K.C., M.P.,
Speaker of the House of Commons,
Ottawa.
Dear Sir,-Please convey to the House of Commons on behalf of my mother and the other members of our family our deep appreciation and gratitude for the great tributes paid to my father's memory and for the sympathy so kindly extended to us in our great and sudden bereavement.
Respectfully,
Walter G. Hunt,



BRITISH PREFERENCE ON SUGAR

[Stage Direction]
On the Orders of the Day:
Mr. NEIL McTAGGART (Maple Creek):: I desire to rise to what I presume would be a question of privilege. I desire to challenge the correctness of an answer given by the hon. Minister of Marine and Fisheries (Mr. Cardin) to a question appearing in my name on the order paper a few days ago. The question concerned the tariff on sugar, and especially the British preference, and was based on information which came into my possession that the British preference on sugar had been withdrawn.


Hewitt Bostock: I would remind the hon. gentleman that a question of privilege can only be raised if the matter at issue affects the honour of a member of the House. A

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question such as the one raised by the hon. gentleman is a matter for debate on some other occasion, but not before the Orders of the Day as a question of privilege. I do not see where the privilege is in that question. We should therefore proceed with the Orders of the Day.


Neil Haman McTaggart: I defer to your ruling Mr. Speaker, and I will follow it up by a question to the government as to Whether or not the British preference on sugar has been withdrawn?


James Alexander Robb: I think my hon. friend had
better put his question on the order paper; it will be considered in the regular way.



WAYS AND MEANS


[Stage Direction]
The House in committee of Ways and Means, Mr. Gordon in the chair.
1. Resolved, that the first paragraph of subsection one of section six of the Customs Tariff, 1907, and subsection seven of said section six be repealed and the following substituted therefor:
In the case of articles exported to Canada of a class or kind made or produced in Canada, if the export or actual selling price to an importer in Canada is less than the value thereof for customs entry, there shall, in addition to the duties otherwise established, be levied, collected and paid on such article, on its importation in Canada, a special duty (or dumping duty) equal to the difference between the said selling price of the articles for export and the said value thereof for customs entry; and such special duty (or dumping duty) shall be levied, collected and paid on such article, although it is not otherwise dutiable.
(7) Such regulations may also provide fox the exemption from special duty of any article when the difference between the value for customs entry and the selling price thereof to the importer as aforesaid amounts only to a small percentage of its value for customs entry.
2. Resolved, that schedule A to the Customs Tariff, 1907, as amended by chapter forty-seven of the Statutes of 1919, chapter twenty-seven of the Statutes of 1921 and chapter thirty-eight of the Statutes of 1924, and by Order in Council, be further amended by striking thereout tariff items 101a, 587, 588, 591 and 591a, the several enumerations of goods respectively, and the several rates .of duties of Customs, if any, set opposite each of said items and to repeal paragraph (a) of regulation 1 of Order in Council, P.C. 1344, dated 5th day of August, 1924, designated as item 774 of the Customs Tariff, and to provide that the following items, enumerations and rates of duty be inserted in said schedule A:-
Tariff		British		
-	Preferential	mediate	Itema	Tariff	Tariff	Tariff101a	Shaddocks or grape fruit, n.o.p., per one hundred	pounds	50 cts.	*1.00101aa	Shaddocks or grape fruit, when imported from the	place of growth, by ship, direct to a Canadian port, per one hundred pounds	|	Free	*1.00453e	Engines to be used exclusively in the propulsion of	boats bona fide owned by individual fishermen for their own use in the fisheries, under regulations	prescribed by the Minister of Customs and Excise..	10 p.c.	12$ p.c.	15 p.c.469a	Well-drilling machinery and apparatus and parts	thereof, and rope twenty-one hundred feet and over in length, capable of drilling wells of two thousand feet and over in depth, of four inches and over in diameter, and of raising and lowering	casing over four inches in diameter for such wells, for drilling for water, natural gas and oil, and for	prospecting for minerals, not to include motive power	„	5 p.c.	5 p.c.553a	Braided candle-wick with or without wire centre	p.c.	or braided taper-wick with or without wire centre when imported by manufacturers of wax candles or wax tapers for use only in their own factories in the manufacture of wax candles or	wax tapers	Free 35 cts.	588	Coal, bituminous and coal, n.o.p., per ton	45 cts.	588a	Gas for heating, cooking or illuminating per one	thousand cubic feet	6 cts.	6 cts.	591	Farm wagons, farm sleds, logging wagons, logging	sleds, and complete parts thereof	5 p.c.	10 p.c.	10 p.c.591a	Freight wagons, drays, sleighs, n.o.p., and complete	parts thereof	17$ p.c.	25 p.c.
James Alexander Robb: I move that resolution No. 1 with respect to the amendment of subsection 1 of section 6 of the Customs Tariff, 1907, be struck out.
I Mr. Speaker.]


Mr. GOOD:: I am entirely in favour of
having the resolution struck out, but I was going to ask the Acting Minister of Finance whether or not there would be any opportunity afforded of discussing the administra-
30S9

Ways and Means-Customs Tariff
tion of the dumping regulation; if not, whether the present opportunity icould be taken advantage of in spite of the fact that the proposed dumping resolution is to be struck out?


James Alexander Robb: The question is now before
the House.


Mr. CALDWELL:: I think that if the
clause proposed to be struck out were read to the committee it would avoid some doubt or confusion in the minds of hon. members as to what we are striking out.


James Alexander Robb: If hon. members refer to the
Votes and Proceedings of March 24, they will see that I am proposing to strike out the resolution to amend the dumping clause.


William Charles Good: I understand that the Acting
Minister of Finance claimed, when he announced the withdrawal of this resolution some time ago, that the present regulations were adequate. Am I to understand that the present regulations give the same adequacy as the proposed amendment was supposed to provide? Because, it seems to me that the resolution which it is now proposed to strike out gives to the customs officials a tremendous power, a power which they ought not to have under any circumstances. I should therefore like to know whether or not the same power of arbitrary valuation rests with the officials at the present time.


James Alexander Robb: We are proposing to strike
out the resolution giving the officials the very power to which he objects. The act wall therefore remain as it is now, and it will be applied to imports of dutiable goods when they are valued at less than the fair market value in the country of origin-that provision has been in our statutes for many years and it will continue. I do not think I have anything to add to that statement.


William Charles Good: My reason for putting the
question is that there have been a good many complaints as to the determination of "fair market value" in valuing goods for customs purposes. The minister might give some assurance to the House, if he can, that there are no abuses existing at the present time in connection with this particular matter.


James Alexander Robb: Does my hon. friend claim
that the valuation has been too high, or too low?


William Charles Good: I have no personal knowledge of such valuations, but we have heard hon. members mention them. I have heard frequent charges that the valuation which has been placed upon articles for this particular 198i
purpose has been much higher than the market value in the country of origin. I should like to know, therefore, for my own information, how the officials determine the fair market value of these goods in the country of origin?


James Alexander Robb: As my hon. friend knows,
they have methods of gaining that information. According to my observation most of the complaints that have come to the department are that the valuation has been too low.


Mr. FORKE:: It depends upon which
quarter it comes from.


James Alexander Robb: It is administered by regulations in the Customs and Excise Department. There is a Customs Board dealing with the regulations to which the importers may appeal. Generally I think it has been fairly administered. It has been in operation since 1906.


Thomas Wakem Caldwell: I presume the complaint that the valuation has been too low comes from the Manufacturers' Association.


James Alexander Robb: No, not necessarily; not always.


Thomas Wakem Caldwell: I think it would be
doubtful if the minister would claim that it would come from the consumers.


Mr. HOEY:: The minister says it applies
to dutiable goods. Does it not apply to free goods as well, such as binder twine?


James Alexander Robb: Oh, yes.


Mr. CHURCH:: The formal resolution with regard to the dumping clause was announced in the budget speech, but later the Acting Minister of Finance (Mr. Robb) gave notice that he would withdraw it. When he first announced the withdrawal of the dumping clause it met with applause from my hon. friends to my left; no doubt it was a surrender of the government to the free trade policy of those hon. members.
In the large cities of Canada there is a protest from every business man about the way in which German and American goods are being dumped into this country. If you walk into any of the departmental stores in the city from which I come you will find that German goods of many kinds are being sold over the counter, and it is'impossible for the small retailer or the large or small manufacturer to compete under existing conditions. An almost unanimous wish has been expressed that the government should provide a drastic dumping regulation, to take care of our
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native products and industries. The large and small manufacturers of the country have to contend with many economic conditions which are almost intolerable on account of the competition of the German manufacturer, where they have cheaper labour, longer hours of work and depreciated currency. In that country they are not paying the heavy taxes which the manufacturer has to pay in this country. These impositions have become a nuisance and a burden on trade and commerce in Canada, and I do not know how long the present condition is going to continue. A letter was read in the House the other day in regard to this matter, telling us how factories were being closed and how the people were out of work in this country, while Germany was in. a prosperous condition-many people in Canada in the breadline or having a hard struggle to keep home and family together. The other night in the House I exhibited some of these German articles which were sent here from Toronto, showing how impossible it was, owing to the present condition of the dumping clause, to compete with the foreign goods from Germany and the United States.
What does the government propose to do about it? A large number of men are going to the States. Many industries are closed and others are suffering from the lack of some provision which would protect them. I do plead with the minister, notwithstanding what he has said here today and what he stated the other day, to do something for the small manufacturers and the larger manufacturers in order to give them some safeguard, which they have not to-day as a result of the condition of the dumping clause at the present time. The dumping clause was a good Liberal doctrine a few years ago when the Minister of Finance (Mr. Fielding) was actively in charge. He saw the condition many years ago and recognized the necessity of providing relief for the Canadian artisan and mechanic, and he did something for them. But to-day the flood-gates are open, and European goods of all kinds are being sent into Canada and I do not know where it is going to end. Take the shoe industry which has been so much referred to both m this House and outside. We have suffered very much on account of present conditions. Owing to -mass production in European countries, shoes have been sold in Canada for a dollar and a half, when these same shoes could not be produced by Canadian workmen for less than two, three or four dollars. England is coming forward with a dumping clause. It may be an indirect way of IMr. Church.]
doing it by the Safeguarding of Industries Act, but they have to make some provision to safeguard the industries of England. The United States is doing the same thing. I appeal to the minister, because he is more in touch with the trade and commerce of the countrj than anybody else, to look into conditions and have some regard for the unanimous protests from the city from which I come and from all over Canada, and to take some practical action to prevent the dumping of European goods into Canada in such a wholesale manner which has the effect of closing up many industries in Canada,-causing unemployment and driving our citizens to join the exodus.


Mr. EVANS:: I was wondering if the hon. member for Brant (Mr. Good) had received a proper answer to his question yet. I have reason to believe that the dumping clause should not be applied according to the original meaning of that act. I take it the dumping clause is not applied until goods are sold at five per cent less for export than they are sold in the country of origin.


James Alexander Robb: That is right.


John Evans: I have reason to believe the Dumping Act is applied according to the price which is fixed at the instigation of the Canadian manufacturers, instead of being governed by the price in the country of origin, and moreover goods which are on the free list also come under t'he Dumping Act, and dumping duty has been charged on goods which have been imported into this country when sold at the regular price in Great Britain. I Should like to have some information regarding that. The question is whether, with the customs authorities already using the power that this provision sought to give them, it would still be used if we passed this paragraph.


Mr. KENNEDY (Glengarry):: Would the
minister give a statement in a general way as to what he considers the purpose of the dumping clause?


James Alexander Robb: My hon. friend from Saskatoon (Mr. Evans) appears to have a fair knowledge of the position. It applies when the goods are sold at less than five per cent of the fair value in the country of origin. The five per cent however does not apply to free goods. That is the general purpose.


Robert Alexander Hoey: It does not apply to natural
products.


James Alexander Robb: If they are produced in Canada it applies.

Ways and Means-Customs Tariff


Donald MacBeth Kennedy: Would the
minister state whether or not in his opinion the act should be applied where there is no serious cutting of prices as between the country of origin and the price in Canada?


James Alexander Robb: Five per cent is the regulation.


Donald MacBeth Kennedy: It only
applies to dutiable goods.


James Alexander Robb: I will give my hon. friend an instance. The hon. member for North Toronto (Mr. Church) a few moments ago made a representation regarding undervaluation. We have had a lot of representabons placed before us with regard to the importation of manufactured goods. But I recall an instance just about a year ago when there was complaint from the dairymen of this country who claimed large consignments of butter were shipped in from New York at a price fax below the market value. What happened was this. There was a surplus of butter on a certain day in New York and the price went down. They shipped thirty or forty cars into Canada and the price in New York went up immediately. Our dairymen represented to us that the "fair market value" should not be the price on a day when there was a large surplus but the price the day before the goods were shipped, or the day after. Thus hon. members will see that the dumping clause applied to other than manufactured goods.


Donald MacBeth Kennedy: That was
not my question. What the minister states is true in the case of articles where there is a serious fluctuation in the price either in Canada or in the country of origin. If the firm importing into Canada are not seriously cutting their prices in order to interfere with Canadian manufacturers, should the dumping clause be applied?


James Alexander Robb: The regulation, as I pointed out to my hon. friend a moment ago, allows five per cent.


Donald MacBeth Kennedy: Only in
respect to dutiable goods.


James Alexander Robb: Yes.


Donald MacBeth Kennedy: In respect
to goods that come in free, there is no five per cent differential. May I repeat the question again? In respect of free goods where there is no serious fluctuation in price, and where there is no intention to cut the price under that of Canadian manufacturers, should the dumping clause be applied?


James Alexander Robb: That is all a matter of opinion. I imagine the dairymen of this country, had
butter been on the free list, might have raised exactly the same complaint as they would if butter was paying a duty.


Donald MacBeth Kennedy: That may
be very true, but may I repeat my question? -because the minister has not yet answered it. What I would like to know is the policy of his department. In certain cases or in any case where there is a cutting of prices to undersell the Canadian producer of natural or manufactured products, the department applies the dumping clause. I ask him: In cases where there is no serious fluctuation in price and where there is no attempt to undersell the Canadian manufacturer, should the dumping clause be applied?


James Alexander Robb: I will ask my hon. friend if he knows that it has been applied under such conditions?


Donald MacBeth Kennedy: I would like to have a statement of policy of the department.


John Evans: Some years ago I had reason to believe that agricultural implements bought in the United States in the regular way at the price at which they were sold to the trade there, came under the dumping clause here.


James Alexander Robb: This government has largely removed the complaint of my hon. friend regarding agricultural implements.


Mr. BRETHEN:: Is it not a fact that today American automobiles are priced, not at the American valuation,- but at a supposed Canadian valuation?


James Alexander Robb: I will read the law as it is. I am not administering the law:
In the case of articles exported to Canada of a class or kind made or produced in Canada, if the export or actual selling price to an importer in Canada is less than the fair market value of the same article when sold for home consumption in the usual and ordinary course in the country whence exported to Canada at the time of its exportation to Canada, there shall, in addition to the duties otherwise established, be levied, collected and paid on such article, on its importation into Canada, a special duty (or dumping duty) equal to the difference between the said selling price of the article for export and the said fair market value thereof for home consumption.


George Arthur Brethen: Some time ago I made
an examination and went to the trouble to interview some dealers in this city who are selling automobiles. There was a standard price for American machines as advertised in all the American papers. There was no fluctuation in the price. I was informed that that price was not accepted under the customs tariff, but that an arbitrary Canadian price
3092	COMMONS
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was set on those machines for the purpose of duty. With this increased valuation for duty and with the sales tax, the practical result is that the selling price of those cars in Canada is about 48 per cent over the American price.


James Alexander Robb: That has not been directed to my attention.


Mr. LEWIS:: The minister, in reading the regulation, did not say anything about the limitation. He, did not speak about the five per cent differential.


James Alexander Robb: Fifteen per cent.


Mr. ANDERSON:: In view of the fact
that large quantities of German goods are coming into Canada at possibly about fifty per cent of the cost of production in Canada, has the minister taken into consideration inserting a clause in the act giving the minister authority to make special provision for special cases, so that he can act in the interim of parliament?


James Alexander Robb: My hon. friend knows Germany is now on a gold basis, and since Germany has got on the gold basis, the experience is that importations of goods from Germany are not increasing. The importations remain practically stationary.


Mr. STIRLING:: Under what regulations
or clauses was the dumping of fruit in 1924 taken care of?


James Alexander Robb: I think that was an amendment to the Customs Act in 1923.


Grote Stirling: Does the minister mean section 47(A) of the Customs Act?


James Alexander Robb: Yes.


Grote Stirling: Were orders in council
issued to cover that?


James Alexander Robb: I think the minister took
responsibility under section 47(A) of administering that.


Grote Stirling: Would the minister explain why rebates were apparently granted in such a wholesale manner as described in Commissioner Duncan's report?


James Alexander Robb: I could not tell my hon.
friend that because I was not aware that rebates had been granted.


Mr. MacLAREN:: Does the change affect the importation of fresh fish from the United States coast? I understand that occasionally there is an unusually large catch of fresh fish in the United States and that it is sent into Canada at such low prices that Canadian fish fails to be sold at a fair price. Does

the amendment now proposed by the minister affect the matter of dumping as regards fresh fish?


James Alexander Robb: There will be no change in
the law. The law will remain exactly as it has been heretofore. If the fishermen have any complaint as to the price, they should lodge their complaint with the Minister of Customs.


Mr. CLARK:: What is the difference in
effect between the old clause and the proposed clause?


James Alexander Robb: The clause as introduced,
regarding which the complaint has been made by some hon. gentlemen opposite, gave to the officials of the department certain powers to determine the value for duty purposes. The law, as it will remain, determines within what limits those values may be fixed.


John Arthur Clark: Who defines now the value
for customs entry?


James Alexander Robb: It is defined under the Customs Act. I have just read that.


John Arthur Clark: That was the old section.


James Alexander Robb: We are coming back to the
old section.


Arthur Meighen: Except as modified by
section 47(A).


James Alexander Robb: Yes.


Arthur Meighen: The minister, in answer to the hon. member for Yale (Mr. Stirling), said that the Minister of Customs had taken it upon himself to act.


James Alexander Robb: That is my recollection of
the matter.


Arthur Meighen: If the minister will read section 47(A)-I do not have it before me, but I have a pretty distinct recollection of it- he will find that the Minister of Customs has no authority to act and value any goods unless he is first authorized by an order in council.


James Alexander Robb: There may be an order in
council.


Arthur Meighen: That is to say, there
must first be an order in council authorizing him. It is vicious legislation; it could scarcely be more so, as I clearly emphasized in the House at the time. It was designed to put the minister virtually in control of the boundary to do what he liked. But the minister could not act except on the authority of an order in council. If the Acting Minister of Finance (Mr. Robb) will read the act he will

Ways and Means-Customs Tariff
find that I am right. Now, is it a fact that the Minister of Customs and Excise (Mr. Bureau) went in there and acted without an order in council at all?


James Alexander Robb: It is possible he had the order in council.


Arthur Meighen: No, he had not.


James Alexander Robb: My right hon. friend knows
that the Minister of Customs and Excise is a good lawyer and he would not exceed the limitations of the act in the administration of it. *


Arthur Meighen: He is a good lawyer
but-


James Alexander Robb: This question however is
not now before the House-


Arthur Meighen: Yes it is.


James Alexander Robb: -except by way of review.


Arthur Meighen: He (Mr. Bureau) is a
good lawyer but he is a lot more daring politician. The fact is that he had no order in council, for I wrote to the privy council to find out and received the reply that he had none at all. So that if what the Acting Minister of Finance tells us to-day is correct, the Minister of Customs and Excise, without the authority provided by parliament, went to the boundary and did what he pleased, instructing his officials to vallue as he liked. Are we to assume that this was the case? I can read the minister the letter which says that no order in council whatever was passed under the authority of section 47(A).


James Alexander Robb: I will take your word for it.


Arthur Meighen: The minister will admit
that the Minister of Customs had no authority to act at all except on the basis of an order in council to be passed after section 47 (A) had been adopted. He has section 47(A) there and can read it and tell the House whether or not the Minister of Customs had any authority to act without the order in council.


James Alexander Robb: I will accept my right hon.
friend's word for it if he has been in communication on the subject.


Arthur Meighen: That is one thing; but
the minister has the law, and reading that law I want him to admit, or to deny, that the Minister of Customs had any authority to act unless the order in council gave him that authority.


Robert Alexander Hoey: Was he obliged to have an
order in council in each case?


Arthur Meighen: No, a general order, I
think.


Mr. GARLAND (Bow River):: Does the
leader of the opposition mean that all collections made subsequently would be illegal?


Arthur Meighen: The valuations made by the minister without the authority of the order in council were illegal.


William Charles Good: And when did that occur?


Arthur Meighen: I do not know; I did not know it had occurred myself, but the Acting Minister of Finance says that the Minister of Customs acted as he did.


Edward Joseph Garland: But if the valuations were illegal, then at least some portion of the collections must have been illegal.


Arthur Meighen: Perhaps so.


James Alexander Robb: My right hon. friend will
observe that section 46 of the act gives the minister some latitude.


Arthur Meighen: But not the latitude he
gets under section 47(A). Now the fact is -and I do not think any hon. members will be surprised, for it is in accordance with history-that the candidate representing the government in the election in the county of Yale circulated literature and asserted to the electors of that riding that this government, under the authority of this act, had given the farmers there higher protection in fruit than they had ever got under the Conservative regime. This was the appeal on which hon. gentlemen went before the electors in that constituency.


James Alexander Robb: My right hon. friend possibly denied that statement.


Arthur Meighen: I knew that they could
do it under the law, and I assumed that doing it, they did it legally. But now we are informed that it was done illegally. The fact is, as I say, that the Liberal candidate in Yale county, representing a government that claims to be determined to get reciprocity back again, with free fruit, circularized the whole riding proclaiming that this government had given higher protection on fruit to the farmers out there than they had ever enjoyed before. And I have his circular with me.


James Alexander Robb: Did you believe it?


Arthur Meighen: The assumption usually is that such assertions are false. But it is bad enough to do that in violation of all professions made in this House and in the country,

Ways and Means-Customs Tariff
and still worse to do it illegally; it is still worse to do it against a law which in itself is too sweeping and empowers the governor in council far beyond the limit to which it should be empowered. But we are now informed that the minister took the law into his own hands, ignored the provisions of the statute, and went to the boundary and told his officials to value as they liked, for this man one rate and for that man another. And the Liberal candidate in the riding to which I have referred 'made the statement that in that way the government gave higher protection than had existed before.


Mr. BANCROFT:: All hon. members in
this corner will be glad to learn that the good people of Yale, in electing the present member (Mr. Stirling), were voting for a low tariff.


Arthur Meighen: They were voting for
protection on fruit, announced by a man who was in favour of it and whose party openly advocated it. They were voting frankly for something that they understood; they were not voting for something under disguise, only to be fooled.


John Evans: I can give the right hon. gentleman some light on this. It is quite true that apples were being bought in the United States at that time at 65 cents a box and the regular duty brought them up to 95 cents. The British Columbia apple grower maintained that a box of apples should not be sold at first hand under $1.10. Two cars of apples at that time were assessed in Winnipeg, and as a matter of fact a dumping duty of 16 cents a box had to be paid, bringing the total up to $1.11. This was the power given the minister, who could place what price he liked on any fruit or other natural product imported. And that power was enacted in this House on June 22, 1922.


Mr. COOTE:: I want to throw some more light on the question if possible. I was in British Columbia last year when the campaign was in progress in Yale and I cut out of a newspaper I bought on the train the following in reference to a meeting which was being held in the constituency:
H. Sutherland, Liberal candidate, defended the record of the Liberals in the matter of the duty on fruit. He asserted that during the past two years, under the anti-dumping legislation in its present form, reductions in fruit importations as compared with the last two years the Meighen anti-dumping clause was in force, had amounted to 239 per cent. The electors of Vale, he said, must decide- whether or not they are desirous of having that form of taxation discontinued.
It seems to me that there should be some amendment to the Dumping Act. I think the 
minister is well advised to withdraw this amendment, but the government should bring forward some other amendment by means of which it will be possible for the importer of fruit to know in advance whether or not he is likely to be subject to the dumping duty. Under present conditions I do not think the importer knows. I had a letter from a western fruit jobber in which he said:
I would like to emphazise the fact that we never know how much the dumping duty is until after we have possession of the goods, and sometimes we have the apples sold, when two or three weeks afterwards an account is received for the dumping duty, which was not included in the selling cost. We tried to get an established price for apples coming into this market, but our answer was that there might be collusion between shipper and jobber and false invoices made out; so you can see we are sometimes in the dark as far as the dumping duty goes.
And he gives specific instances of the unfair levying of the dumping duty. As I said before, I think there should be some amendment made to the dumping clause, but the amendment proposed was not a proper one, and I am glad it is being withdrawn. Under the present dumping law, will the minister inform us if the officers of the Department of Customs are given the power to set an arbitrary value upon motor cars which are brought into this country ? Such cars are sometimes accompanied by a sworn affidavit as to the price paid, and yet the customs officers will arbitrarily set a value on the car for duty purposes which is sometimes nearly twice the sworn invoice value.


James Alexander Robb: My understanding is that the officers of the department must assess the value as provided for by the Customs Act.


George Gibson Coote: Just what does the Customs Act provide in that case? Does it give them that power, or should they take the exporter's invoice of the price paid for the car as the value for duty?


James Alexander Robb: I do not know that I can
give my hon. friend any further information.
I believe that all hon. gentlemen who desire to look after our legitimate trade will agree with me that the customs board must have some latitude. I may take my hon. friends and the public into my confidence to this extent. We have had complaints that goods were being smuggled into this country. Not long ago our secret service men raided the offices of an importer, and discovered that he had (blank invoices, properly endorsed by the exporting firm, and sworn to. He took these blank invoices, filled them in, and went to the customs and tried to pass his entries on them. It is manifest that we must have

Ways and Means-Customs Tariff
some power to catch those chaps. I think my hon. friend will admit that.


George Gibson Coote: I was just trying to find
out, Mr. Chairman, what power the minister or his officers had to place an arbitrary value on imported motor cars. I must say I have not yet found out.


Mr. CAMPBELL:: Mr. Chairman, the
minister's explanation in this Tegard is not very satisfactory. Surely the officers of the department have some means of arriving at the prices of imported goods without resorting to arbitrary action. Surely the price lists of motor cars, for instance, are available to them. Reverting to the point raised by the hon. member for East Peter-
4 p.m. borough (Mr. Brethen), is it not a fact that even where the valuation of an imported automobile is agreed on, where in fact there is no dispute as to price, five per cent is added to that price before the automobile is assessed for duty? That is, all invoice prices are increased to the extent of five per cent. Is that not so?


James Alexander Robb: It may be.


Milton Neil Campbell: But is it not an arbitrary riding of the department? I am not quite clear what the minister says as to this.


Robert King Anderson: Is not the sales tax in
the country of origin added to the import price for customs purposes?


James Alexander Robb: Yes, that establishes the fair
market value of the article in the country of origin.


Mr. LADNER:: I understood the minister
to say that the law as it stood requires the valuation to be based upon the fair market value of the imported article in the country of origin. My understanding was that valuations are based on the home consumption.


James Alexander Robb: Yes, the home consumption
value in the usual and ordinary course. That, I should think, means the fair market value.


John Arthur Clark: Mr. Chairman-


James Alexander Robb: If hon. gentlemen desire me
to take up their time and read the Customs Act I shall be very glad to do so, but I would suggest that they get the act and read it for themselves. I would refer them particularly to sections 41, 42 , 46 and part of 47, which prescribe the powers of the minister and officers of the department.


Robert Forke: Mr. Chairman, there seems
to be a good deal of confusion in respect to this matter and it has not yet been dleared
up. In fact, no one yet knows exactly how these duties are assessed upon articles that are imported. For instance, take a motor car advertised in the Saturday Evening Post at $1,800. It should not be a difficult matter to add the luxury tax and specify the rate of duty that applies. Is that done?-that is the point. Or does the officer simply make an arbitrary valuation and assess the duty? There is no use denying the fact, Mr. Chairman, that there is a suspicion in the public mind that the customs officers are charging more than the import duty-if 35 per cent is not enough, put on 50 per cent. Of course,
I am not advocating any such rate of duty. But let us know exactly where we stand. That is the way we look at it.


Milton Neil Campbell: Mr. Chairman, the minister has admitted that five per cent is added to the price I should like to know on what authority this is done. If I import an automobile valued at $2,000, I find it is assessable for duty at $2,100. Where does the minister get authority to add $100 to the price of that car for the purpose of assessing the import duty?


James Alexander Robb: I understand the five per cent is added for the home consumption price. Answering my hon. friend from Brandon (Mr. Forke), I do not know anything about advertisements in the Saturday Evening Post or any other paper, but the prices there advertised need not mean the fair market values or the prices for home consumption. My hon. friend has had too long experience to believe that. For instance, departmental stores advertise goods at certain prices, but it is well known that this is simply a drawing card to attract customers, and does not always mean that those are the fair market or home consumption prices. It is the duty of the customs officers, representing the people of Canada, to investigate whenever they are in doubt concerning the actual selling price in the country of origin of the article imported.


Arthur John Lewis: It was stated a few minutes
ago that one hundred per cent is added in arriving at the import value; and yet the minister said only a short time ago that in applying the dumping duty his department was limited to a range of fifteen per cent. Is that ever exceeded?


James Alexander Robb: I am telling my hon. friend
what the law provides. If any hon. gentleman has a case to submit where officers of the department have exceeded that range, I shall be glad to have it investigated.
3096	.	COMMONS
Ways and Means-Customs Tariff


Milton Neil Campbell: Where does the minister get authority for adding 5 per cent to the import price of an automobile? If I go to the United States to-day and buy a car for $2,000, the regular selling price, I find I am assessed for duty purposes on a valuation of $2,100. I am anxious to find out where the minister gets authority to do that. Twenty-one hundred dollars is not the price for home consumption.


James Alexander Robb: I am told by my officers that this is done under section 41, which establishes the fair market value:
Such market value shall be the fair market value of such goods in the usual and ordinary commercial acceptation of the term and as sold in the ordinary course of trade, provided that a discount for cash for duty purposes shall not exceed 21 per cent, and shall not be allowed unless it has been actually allowed and deducted by the exporter on the invoice to the importer.


Milton Neil Campbell: Mr. Chairman, that gives the minister no such authority. Two thousand dollars is the price at which that car can be purchased at any place in the United States; there is no question about that. Yet I find $100 is added to that price.


Mr. KELLNER:: According to the report
of the commission which investigated the alleged fruit combine last year, those prices are not arrived at at all by means of the act, but by regulations passed by the department. I have before me a long list of these regulations which the department has passed. The fair market price would be arrived at by what is presumed to be the selling price in the United States, regardless of whether the goods were bought for cash or credit. No matter whether it is fruit or manufactured articles you are importing, the importer in Canada should be assessed on the wholesale price of the article, and if he is paying cash for it, it should be on the cash price. But according to these regulations he would be assessed on the credit selling price. I do not think there is any question but that if the department is allowed to make regulations fixing these prices, the act does not amount to anything, for the regulations are the governing factor, and not the act at all.


William Charles Good: I think the minister ought to give us some satisfaction in regard to this question. Let me put a case to him. Supposing I go to the United States and buy a second-hand car for $100, and present a sworn certificate to the customs officials that that is all I paid for it. Would the officials have the right to say to me, "No, we cannot accept that price; we must charge you duty on a valuation of $200"? Would that be possible under the regulations?


James Alexander Robb: That is an imaginary case my hon. friend is bringing up-


Some hon. MEMBERS:: No, no.


James Alexander Robb: -although it is in common practice to a considerable extent. We know there is a vast organization that steals automobiles, and brings them into Canada and offers them at a low price. These fellows are crooks to start with, and anything is a price to them. I would ask my hon. friend, are the customs officials not justified in watching that sort of commerce?


Milton Neil Campbell: Is a man assumed to
be a thief if he brings in a cheap motor car?


James Alexander Robb: Certainly not, but there are
men in prison to-day who have been convicted of stealing automobiles and bringing them in here and selling them at a low price.


William Charles Good: The minister is evading the
question. I say that if a man bought an automobile in good faith for $100, and certified to the department that that is what he paid for it, would the officials have the power to charge him duty on a valuation of say $200?


James Alexander Robb: I understand the procedure is this:	They take the list price of the automobile and allow so much for depreciation each year-they know the year the car was made-and in that way they arrive at the value.


William Charles Good: An arbitrary valuation.


Arthur John Lewis: In that case the fifteen per
cent maximum does not apply at all.


John Evans: In the case cited by the hon. member for Brant (Mr. Good), is not the trade discount taken into account according to the status of the importer? If the importer is a dealer, the whole amount of the trade discount is allowed, and duty is not charged on it, but if under the Canadian rides of the distributing combine, which is recognized in the Tariff Act of Canada, the importer happens to be a consumer, no trade discount is allowed. That trade discount sometimes amounts to fifty or sixty per cent.
I think that would perhaps answer the question of the hon. member for Brant.


Milton Neil Campbell: I ain not at all satisfied as to this 35 per cent, and I think the minister ought to give us some better explanation, particularly (with reference to automobiles. It simply means the importer has no protection at all. The consumer is paying 35 per cent duty, and if the minister thinks 35 per cent is not sufficient, let him increase the duty and make it 37 or 37J per

Ways and Means-Customs Tariff
cent, or whatever is necessary. Let us know what it means. When I buy a tear anywhere in the United States for 82.000, and I find I have to pay on a valuation of $2,100, I maintain the department is getting money out of me by subterfuge. It is a dishonest practice, something that would not 'be tolerated in connection with any other business in the country. Surely the department can be open and above-board and put on sufficient duty if they think 35 per cent is not enough. Let us know precisely just what we are obliged to do.


Leon Johnson Ladner: Under the original proposal, which properly and frankly placed in the hands of the minister power to fix a value so as to protect a similar article in Canada, the importer knew exactly where he was at. Under the old1 practice the value of the article, let us say a second-hand motor car, was supposed to be the home consumption value, but when you buy that car on the market in Los Angeles for $400 or $500 and bring it up to Canada, by some method or another the Customs officials arrive at the value of that car by estimating depreciation over a series of years. That depreciation is calculated arbitrarily so as to make the value for duty purposes in Canada such as to give protection to similar articles produced in this country. I am in favour of protecting the articles produced in this country, but what I am putting to the minister is this:	Under
what authority or by what provision of the law have the officials of the department the right, to fix a depreciating value instead of taking the actual home consumption value?


James Alexander Robb: They are working under sections 41 and 42, which authorize them to determine the fair market value.


Leon Johnson Ladner: I am pointing out to the minister, and I do not think he will deny, that the officials do not fix a fair market value. The fair market value is a question of fact to be determined from the evidence on the spot where the markets are. In this case it would be the price of cars in California. What they do is to put an arbitrary value on the car, and I believe they do it without authority. I am asking the minister if they have authority, and whether it would not be better-I think it would be much more honest to the people of this country- to maintain the provision he is now proposing to repeal, and give power to the minister to put a value on the imported goods. I would like my question answered-whether the act gives authority to anyone to make an arbitrary discount each year for depreciation, instead of taking the home consumption value.


James Alexander Robb: I have only to answer my hon. friend again that the officials are operating under the clause which empowers them to determine the fair market value. There is also a provision in the Customs Act-I have not the clause before me at the moment- for an appeal to a board of arbitration.


John Arthur Clark: I am not clear as to the meaning of the words "the value thereof for customs entry." I understand the article would be valued at the home consumption value now. Under the proposed section will the article be valued according to the home consumption value, or according to the value in the market where purchased, or will it be valued arbitrarily by the opinion of the customs officials? It must be one of the three.


James Alexander Robb: It is arrived at under the terms of the Customs Act.


John Arthur Clark: What are the terms of the Customs Act as to "the value thereof for customs entry "? What do these words mean? I am putting three propositions to the minister, and it must be one of the three, I should think.


James Alexander Robb: My hon. friend misunderstands me, that is the clause I am striking out.


Mr. GOULD:: I should like to ask the
minister what law he would invoke if, as a result of wheat in the United States being ten cents per bushel lower than Canadian on the average, as it was this year, if the millers of Canada could take advantage of that lower price to import American wheat and use it in their mills?


James Alexander Robb: My hon. friend, who is a grain man and I believe knows as much about the grain trade as anybody, in Canada, must be aware that under the act, as it now is and has been for many years past, the millers of Canada can import wheat from the United States just the same as American millers can import Canadian wheat and mill it in bond for export.


Oliver Robert Gould: One of the reasons why it
would not have been economical to do that in the past is that this is the first year that Canadian wheat has been quoted at a higher price than American wheat. This new condition has obtained since the harvesting of the crop of 1924-25 for the first time in our history. I am not asking that the dumping law should be enforced, and therefore am

Ways and Means-Customs Tariff
showing generosity from an agricultural point of view; but some consideration should be given to the other questions which have been raised by other hon. gentlemen. If the condition referred to is going to continue, will there be any medium by which there might be a levelling up, in the ease of Canadian millers importing American wheat and grinding it in this way?


James Alexander Robb: Everybody knows that in the markets of the world wheat as a commodity is on a parity with gold.


Oliver Robert Gould: True enough, but in all past years American wheat has been on the average ten cents a bushel higher than Canadian wheat.


James Alexander Robb: I will not admit that there is that difference in the quality of the wheat.


Oliver Robert Gould: We know the lower quality of the American wheat, yet in the past it has been quoted at from ten to twenty cents a bushel higher than our good Canadian wheat. Now the price of American wheat has in every year up to 1924-25 been on the average ten cents a bushel higher, which made a disparity of twenty or thirty cents as compared with Canadian wheat. This creates a condition which may result in Canadian millers importing American wheat and grinding it in this country.


James Alexander Robb: If the Canadian miller imported American wheat and it came under the dumping clause he would have to pay the penalty.


Oliver Robert Gould: Have the dumping duties
ever been applied to wheat coming in under these circumstances?


James Alexander Robb: Not to my knowledge. I
should like to advise hon. gentlemen that when they have complaints, as some of them seem to have, as to the determination of the valuation, the Customs Act already provides for those complaints being brought to a proper tribunal. ;If the importer is dissatisfied with the appraisement the act provides that he may appeal. I will read' the section in question so that it may appear on Hansard:
Except as in this act otherwise provided, if the importer, owner, consignee or agent, having complied with the requirements of this act, is dissatisfied with the appraisement of any such goods made by the appraiser hereinbefore mentioned he may, within three days, give notice in writing to the collector of such dissatisfaction, on the receipt of which notice the collector shall at once notify such importer, owner, consignee or agent to select one disinterested and experienced person familiar with the character and value of the goods in question, and the collector shall select 
a second person with similar knowledge and notify such person, importer, owner, consignee or agent of such appointment.
And then they proceed to deal with the
case.


Arthur Meighen: The minister knows that clause would never apply to section 47(A). That clause could never apply except that the principle of valuation were declared by statute. But under section 47(A) all principle of valuation is swept away, and the minister is put in power-clear, despotic power-over everything. All he need do is to express his will on any principle at all. Consequently the appeal could not apply because the appellant would have nothing to go on. This government has swept away the protection of parliament and assumes the whole authority itself, all in the name of " responsible government


Mr. WOODSWORTH:: May I call attention to a case which, perhaps, illustrates one difficulty in determining what the fair market value of an article is. The matter itself is very small. There were some books advertised by the Haldeman-Junius Company, Girard, Kansas, a series of books ordinarily sold at ten cents but reduced for a certain fixed period to five cents per copy. A Canadian wrote away for a number of these books and found that he was charged a heavy duty. He wrote about the matter and received this explanation:
It would appear that these books are paper bound and are therefore subject to duty at the rate of 25 per cent ad valorem under tariff item 169. The books were invoiced to the purchaser in Canada at six cents each, and the collector raised the value to ten cents per book, in view of the enclosed advertisement from the Toronto Mail and Empire.
It would seem a rather arbitrary and farfetched interpretation to raise the value of these books from six to ten cents simply because they were being sold at a bargain for a limited period. I should like to ask whether this is a correct interpretation of the act according to the minister?


James Alexander Robb: My hon. friend had better make application to the customs people about that.


James Shaver Woodsworth: I have read from the interpretation of the customs officials. This case would seem to me to illustrate the point at issue, that there is an absolutely arbitrary power given into the hands of the officials of the department when the price of books invoiced at six cents each can be arbitrarily raised to ten cents simply because it is claimed they are offered at a bargain.

Ways and Means-Customs Tariff


Mr. RYCKMAN:: I am unwilling that the
hon. member for Mackenzie (Mr. Campbell) should worry about that $100 on his $2,000 car if I can relieve his doubts. I think that $100 just represents the five per cent sales tax imposed by this government. The United States government is very careful to impose the sales tax in considering the value for entry into that country, and I think it is quite proper that this country should also do so. With regard to the $100 second-hand car there is a market in second-hand cars, a very substantial one, in this Dominion, and if a member of parliament can go over to the United States and buy a hundred-dollar car-I do not know really what it would be like, I would imagine it had been stolen-and then come back and tell his friends what a great bargain he had got,
I do not see why, considering the regulations in force in this country and the home market there is in second-hand cars, he should not be willing to pay the duty which Canada imposes on the right value of that car. I should like to say a word to the minister in commendation of this dumping legislation, and I wish that it could be made more effective. There is a very recent case where an order to the value of about $30,000 was wanted in Canada. The United1 States manufacturers were altogether unwilling to break their price lists in the United States or to quote a lower price than they were asking in their home market. But being very anxious to avail themselves of a chance to make a deal of this kind they quoted the Ontario buyer a very much lower figure. The matter was taken up with the Customs department. It only required a little investigation-and I wish to compliment the minister upon the working of the department in this case at least-to disclose the facts of the case. It was very soon ascertained that all these people wanted to do was to get rid of their surplus; that while they were unwilling to break their prices in the United States they were eager to make quotations upon and offer the same goods for sale in Canada. Between $5,000 and $6,000 would have had to be paid in additional duty if the goods were imported into Canada. When that fact was discovered the goods were npt imported. The result is that workmen in Canada are engaged at this very minute in manufacturing the articles which the United States manufacturer tried to sell by quoting in Canada a price he would not quote in the United States.


Milton Neil Campbell: I do not think the
hon. member intended to mislead the House, but he has a wrong impression entirely of the case I quoted. With regard to the automobiles, the five per cent is not the sales tax. There is a five per cent arbitrary assessment over and above the value of the car. Take the case of the car valued at $2,000. The department adds $100, which is five per cent, and makes the price $2,100. Thirty-five per cent duty is assessed on that, which makes $735, bringing the price to $2,835. The sales tax is assessed on $2,835.


James Alexander Robb: Perhaps my hon. friend is not aware that there is an excise luxury tax in the United States, and that accounts for the $100.


Milton Neil Campbell: That is the difference
in the value of the car. The person buying the car does not have to pay that. There is an export tax which is not paid by the purchaser of the car at all.


James Alexander Robb: That establishes the home
consumption price when he adds the $100 excess tax.


Milton Neil Campbell: That is the purchase
price; the department here adds $100 or five per cent.


James Alexander Robb: But if he were a United States citizen he would have to pay the $100 excise tax and'that establishes the fair market value for home consumption in the United States.


Robert Alexander Hoey: The luxury tax applies only
to cars in the United States selling over


James Alexander Robb: He (Mr. Campbell) is quoting a $2,000 car.


Robert Alexander Hoey: -and our duty is imposed
on the price of it, plus the luxury tax which the purchaser in the United States has to pay.


Milton Neil Campbell: I am not satisfied with the minister's explanation. The $2,000 in this case includes all the cost in the United States, but there is an export tax in the United States which I understand the individual importer buying the car does not have to pay. The department takes hcfld of that and raises it a little above the thirty-seven per cent.


George Gibson Coote: I think the way the duty is collected on automobiles at the present time is wrong. It may be in accordance with the letter of the law, but it is hard to believe that such is the case. Take the case of a car costing $1,000 in the United States. The purchaser of that car in the United States would have to pay the five per cent tax that would make the price $1,050; and that is the value taken by the department here when a car is imported1; so that an individual purchasing a car in the United States and bringing it in-
3100 ^	COMMONS
Ways and Means-Customs Tariff
to Canada pays a duty of $367.50, whereas the dealer in Canada, when he purchases several cars in one shipment, is not required to pay duty upon that five per cent. If he imports a car sold retail for $1,000 in the United States, he will bring that car into this country at a discount of probably twenty-five per cent. That is, those cars would be valued at $750, and he is not charged any extra five per cent, so that he pays $262.50 customs duty as compared with the $367.50 paid by the individual, I do not think that is right. The same thing I am told applies to the sales tax and to our excise tax. The individual would pay in sales tax and excise tax a total of $141.75, while the dealer would pay on the same car $101.25. I think the law as administered1 is working out very unfairly and I do- not think this practice is in accordance with the act.


James Alexander Robb: I imagine my hon. friend
has given a correct view of the trade conditions, but I imagine also that the price which the Canadian dealers pay is the same price as the United States dealer would pay, and the price charged a Canadian for one car is the price paid in the United States by the man who buys one car.


George Gibson Coote: It may be what he is paying for it, but is that the fair price for home consumption?


James Alexander Robb: Anybody buying a like
quantity in that country would be entitled to the same rate.


George Gibson Coote: With regard to the power
of the department, I understood the minister to say that there was a section in the act which allowed for an appeal in case a man thought he had been overcharged in connection with an automobile or anything else. I understand it is the practice of the department to issue an appraiser's bulletin, showing the value of all makes of cars, and showing the valuation which would be placed on second-hand cars and cars which had been used. Surely that is an arbitrary power, and that is done under a bulletin issued by the department. It would not be any use to make an appeal if a man thought he was overcharged when they charged him according to the value fixed in a bulletin issued by the department.


[Stage Direction]
Amendment agreed to.
On resolution 2:
The CHAIRMAN:: Does the committee
wish me to read all these items?


Some hon. MEMBERS:: No.


Mr. STEVENS:: If the minister would take those items in the schedule one by one that 
would be sufficient. I do not ask that the minister read all the items now.


James Alexander Robb: My hon. friend can take up any one of them be wishes.


Henry Herbert Stevens: Would the minister give to us the existing rate of duty in each case as we come to it. I wish to discuss one or two of them.


James Alexander Robb: W'hat items does my hon.
friend wish to discuss?


Henry Herbert Stevens: Would the hon. gentleman give me the existing duty in items 101a and lOlaa.
Customs tariff

101a. Shaddocks or grape ifruits, n.o.p., per hundred pounds: British preferential tariff, 50 cents; intermediate tariff, $1.00; general tariff, $1.00.


[Stage Direction]
Item agreed to.
Customs tariff-lOlaa. Shaddocks or grape fruit, when imported from the place of growth, by ship, direct to a Canadian port, per one hundred pounds: British preferential tariff, free; intermediate tariff, 50 cents; general tariff, $1.00.
(Mr. ROBB:	There, is a change in the
second, putting it on the free list if it comes into a Canadian port, bult there is no change in the other. -
Item agreed to.
Customs tariff-453e. Engines to be used exclusively in the propulsion of boats bona fide owned by individual fishermen for their own use in the fisheries, under regulations prescribed by the Minister of Customs and Excise: British preferential tariff, 10 per cent; intermediate tariff, 12J per cent; general tariff, 15 per cent.
Henry Herbert Stevens: This is a very substantial reduction, I understand.


James Alexander Robb: The present rates run along in order. They are: British preference, 15 percent; intermediate, 25 per oenit; and general, 271 per cent. We propose -to reduce them to 10 per cent, 121 per cent and 15 per cent respectively. The estimated reduction will be about $15,000. There was imported for consumption, of engines, internal and combustion, during the fiscal year ending 31st March, 1924, $225,521. It was estimated that not more than one-half of these imports would be entitled to entry under this item.


Henry Herbert Stevens: I have" seen some correspondence in regard to this matter. There are, I -think, three different concerns in Vancouver-and I know this affects others in Victoria, New Westminster and eastern Canada, but I am speaking more particularly of the Pacific -coast-that have been manufacturing these engines for some time. I have in mind two concerns that have been established for some twen-ty-five years,

Ways and Means-Customs Tariff
gradually building up their business. They have succeeded in establishing themselves well and they have been building an engine that has -been giving excellent satisfaction. So far as I am aware, there has been no demand for a reduction in the tariff and no complaint regarding the -price of these goods. I am quite aware that, perhaps, individuals, in view of this reduction, might say to the minister that it is a good thing from their standpoint as purchasers. But I want to point out to the committee what invariably follows in a case like this. When these three or four concerns at -the coast, for instance, manufacturing these articles, are put out of business, as they will likely ibe as a result of this, and -cease to manufacture, the firm in the United States or elsewhere, marketing their goods on a market that will be free from the -competition of the home manufacturer, will raise the price and there will ibe no advantage to the consumer at all. Had there been some abuse of the tariff, had these local concerns been extracting some exorbitant price or not been giving satisfaction-, or had there been some general complaint or suffering, there might have 'been an excuse. But in the twenty-five years or more that I have been acquainted with these manufacturers and with the business, I do not know of any form of complaint warranting a reduction. This is going to have a very serious effect upon these industries. The result will be throwing an additional number of men out of work and on the labour market. On the Pacific coast more than in eastern Canada we have been striving to build up and establish industries that are either directly or indirectly based upon our natural resources, and it must be clear to any fair-minded person that it takes a considerable period of time, especially where you have a sparse population, to develop such an industry. It is also clear from experience tha-t if such an industry is stifled in its infancy or when it is comparatively small, that market receives no advantage since the importer or manufacturer in another country has the local competitor eliminated. Personally; I am ex' cgedingly sorry -that the minister has included this in his deductions. I wish the minister would state the grounds upon which this step was taken, if he can do so.


James Alexander Robb: My hon. friend will recollect
that last year we made some concessions to the producer on the -land, lumber mills, mines, and it was represented to us that we were going to put a number of industries out of business. That, however, has not been the result. Some of these industries are in just as good shape as they were before. This year it was represented to us that we should do something for the fisherman, the man who goes out and risks his life, making his living by fishing. It is not any more the desire of the government than the desire of my hon. friend to put -any industry out of business, and we have taken care of that. If my hon. friend will turn to item 1048, he will note that we are giving a rebate of 50 per cent of the duty on the raw material going into the manufacture of these engines, so that we believe the industry will be in a pretty good position even with the change.


George Gibson Coote: What is the rate of duty on small engines used on the farm?


Mr. KYTE:: I am very sorry that the hon.
member for Vancouver Centre (Mr. Stevens) takes the view he does with regard to the effort that the present government has made t.o relieve to some extent the burden which the fishermen of eastern Canada are carrying in connection with their business of fishing. When the very substantial reductions were made on mining machinery and other implements of production a year ago, it was felt that the government should have gone a little further and given the large and important element of our population who are engaged in fishing some slight advantage in the same direction. I am glad to know that the representations which were made by representatives of the Maritime provinces, and also by representatives of fishing constituencies on the Pacific coast to the Acting Minister of Finance (Mr. Robb) have borne fruit and that this substantial reduction has been made in the duty on gasoline engines. At the present time no fisherman can hope to carry on successfully the business in which he is engaged unless his boat is equipped with a gasoline engine. The time was when fishing boats were propelled by sails or oars, but that time has passed away. Boa-t-s are more expensive now than they were thirty or forty years -ago. It -costs more to build a boat in- which a- gasoline engine is installed than it -did to bui-ld the boat that was pro-pdll-ed by sails. These considerations should have weight with -the Acting Min-istet of Finance and- they have had weight. There is no feature of the budget and no reduction in the duties bearing upon implements of production indu-de-d -in- the budget proposals as brought down by the Acting Minister of Finance t-hat wild -be -more appreciated by the people of the -Maritime provinces than the item under discussion at this moment. I should have been glad if the minister could have removed the d-uty entirely from gasoline engines. Not having been able to do that, he has taken

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a step in the right direction, and his action in this regard1 will be highly appreciated amongst a'M fishing communities in t'he Dominion of Canada.


Henry Herbert Stevens: I now have some of tlhe correspondence to which I referred and I would tike to read it. This is a tdleigram from the Vivian Gas Engine Works, addressed to myself under date of March 25, immediately following the introduction of the resolution by the minister:
We regard announced reduction duty fishermen's gas engines from twenty-seven and half to fifteen per cent as extremely serious in effect it will have on our business. Since commencing operations in 1909 and through financial assistance accorded us provincial Department Industries we have built up industry to-day employing average twenty-three skilled mechanics with payroll averaging seven hundred dollars per week. We are dependent for seventy-five per cent our business on orders from individual fishermen and while reduction in duty represents very little saving to those buyers in purchasing American engines reduction in prices which will be forced make to retain business simply means difference between profit and loss to us. We hope you will make strong protest and endeavour induce government refrain from proposed action in view its inevitable effect in eurtailing our operations.
Vivian Gas Engine Works.
I have also a telegram from Eastbope Brothers, Limited. This concern has been built up in the most commendable manner from a small shop operated, I think, by a family of two or three brothers and the father, established many years ago, until it has acquired now a considerable standing and reputation.	The business experienced for a
number of years all the vicissitudes of a growing industry; the type of engines produced has changed in the last twenty years from two cycle to four cycle, and so on, and there have been many other modifications and inevitable alterations. They have kept pace with all these changes and have turned out an excellent engine. They say:
Reduction in duty on American engines from 27J to 15 per cent announced in budget literally means wiping out our industry as we are dependent for 90 per cent our business on sales individual fishermen. As you know we started business here in small way in 1890 and have gradually built our business up till to-day we are employing twenty-five highly skilled mechanics with average annual pay roll of not less than $50,000. We cannot possibly reduce our price to compete with figure at which American engines can be sold here under new tariff and only result will be that our employees with their dependents will be obliged go American side where engines which will be sold in this market in future are made. This is life and death proposition with us and we ask you protest in strongest possible terms on our behalf against announced reduction.
I have other representations as well. I appreciate what my hon. friend (Mr. Kyte) said a moment ago; there is perhaps some 
temporary advantage to be gained by a few individual fishermen. But I know that so far as the Pacific coast is concerned, where there are a great many fishermen who use this class of engine, we shall find that once the Canadian manufacturer is put out of business, as he will be as a result of this, any advantage that may accrue to the purchasers of these engines will disappear. And I doubt very much whether my hon. friend's constituents on the east will derive any advantage from this reduction. It may 'be that in eastern Canada some of the plants having a wider market may be able to meet the American price by some means or other, although I am not sufficiently qualified to speak in that regard. I will venture to say however that in many -cases in the east there will 'be put out of business plants which have -gradually developed in the -manufacture of these engines; and on-ce they are driven to the wall the fishermen will get no benefit from this alleged favour.
Last year when the question of a reduction in logging machinery was under consideration I predicted certain results; and in remarks I made early this session I pointed out that certain businesses in Vancouver had been seriously affected. The Minister of Public Works (Mr. King, Kootenay) in his speech declared that I had stated what was untrue, and he made a very strong attack on me on that account. I was unable to reply to him at the time. He read into Hansard a letter from a certain individual whom he described as a leading machinery manufacturer. I think my hon. friend (Mr. Tolmie) corrected him in this regard. I take this occasion to refer to the matter for the reason that unless I do correct the Minister of Public Works someone will probably say that the same argument applies to what I am advancing on behalf of Easthope Brothers and the Vivian Gas Engine Company and others. I want the minister and the government to take these representations seriously; it is the duty of the government to consider the welfare of all those who may be affected. If we could give concessions to certain groups, whether fishermen, loggers, or agriculturists, without injuring anyone else and without losing some decided advantage to the country in the way of industry, it would be a simple matter. But if in granting something which is alleged to be an advantage we at the same time put industries out of business and throw bona fide industrial workers on the street, we are doing an injury not only to these individuals but to the whole community, inasmuch as the effect will gradually work round to the very

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class, such as fishermen, whom these reductions are supposed to benefit. I have here a copy of a letter which has already been placed on Hansard. I shall not read it at length but I wish to refer to it. It deals for instance with the effect of the tariff reductions on local manufacturers. In the case of the Britannia Wire Rope Company, it is shown that the amendments of last year have resulted in a serious curtailment of business, throwing a number of workmen out of employment. Let me cite an instance.
In the early part of 1924 the Canadian Sumner Iron Works and one other Canadian company were bidding on the entire list of equipment for one of the largest mills in the province, namely, that of the Victoria Lumber & Manufacturing Company of Chemainus. Before the bids were closed the tariff reductions of April 11, 1924, came into effect and the entire order, which would have represented business retained in Canadian plants of approximately $200,000 if placed with the local plant, was placed with the Diamond Iron Works of Minneapolis. That is an illustration of the effect of reducing the tariff. Here was an order of $200,000 lost to a Canadian firm; and there was no particular demand for the reduction in question. The same thing applies exactly to the item now before us dealing with gas engines. I am sure that the result will be a loss of business to Canadian firms and consequent unemployment; and further than that it will involve a loss of capital invested in these businesses. I will ask the minister to follow the good example which he himself set in dropping the dumping clause and leave this clause out of the list. If he does so he will win a good deal of gratitude from a very deserving people. It may be too late to make this appeal but I submit it to the minister anyway.


James Alexander Robb: I am afraid it is.


Henry Herbert Stevens: I am exceedingly sorry that the minister should take that stand.


John Evans: I am glad that the government has decided to take the duty off engines for fishermen,' for if there is a class of men in primary production who need encouragement it is the fishermen, particularly those who are in business in a small way. There is no duty on raw fish. It is when this commodity gets into the manufacturer's hands for curing that the duty is put on. And there I find fault with the government to-day; they favour organized industry as against those who are engaged in primary production such as farmers and fishermen. Organized industry is protected all the way through, but nothing is done to make the cost of living come down.
Regarding the contention of the member for Vancouver Centre (Mr. Stevens) that some of these concerns will be put out of business, I do not see why they should be. I do not see the use of trying to bolster up such an industry, because by their plea for tariff protection they admit that the finished article they produce is worth less than the raw material and the labour they put into it. There are plenty of vocations for Canadians to engage in, and if it is more profitable for our people to fish than to make gasoline engines, they will adjust themselves accordingly. I think the hon. member's contention is based on what over and over again has been proved to be a fallacy of the very first rank.


Mr. McISAAC:: Mr. Chairman, why
should the fishermen of the Maritime provinces be compelled to pay a higher price for an inferior article? Every fisherman will tell you that an American engine will last at least twice as long as an engine made in this country, because the former is built to better withstand the action of salt water. It is therefore the fault of such concerns as the hon. member for Vancouver Centre (Mr. Stevens) refers to that our fishermen will not buy their output. Then why should all the fishermen of Canada be penalized? If our manufacturers had the enterprise to turn out the right quality engine, they would find our fishermen would buy them in preference to the engine built by their American competitors.


Henry Herbert Stevens: May I correct my hon.
friend in one regard? He says that the American engine will last twice as long as the engine built in Canada. That is not the case with respect to the engine turned out by the concern to which I have referred. Their engine has been demonstrated to be in every way satisfactory. The trouble is our manufacturers with a comparatively small market have to compete with the massed production south of the line. The same applies to the arguments advanced by my hon. friend from Saskatoon, which I will deal with in a moment or two.


Colin Francis McIsaac: I do not know about
British Columbia engines, but I do know that what I have said applies to engines purchased in the Maritime provinces.


Mr. SNOWBALL:: I desire to commend
the Acting Minister of Finance (Mr. Robb) for the. reduction he has made in the duty on gasoline engines for use by our fishermen. This will be a boon to the fishermen in the Maritime provinces. I am not conversant with gasoline engines manufactured on the

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Pacific coast, but I do know tihat the engines manufactured in the Maritime provinces are not equal to the engines that can be procured by our fishermen across the line. If our manufacturers wish to secure and retain business in the Maritime provinces, they must pay more attention to tinning out an engine that is adapted for use in salt water-that is, for the work our fishermen are engaged in.


Leon Johnson Ladner: Will the 'hon. gentleman
tell us in a practical way to what extent a fisherman in the Maritime provinces would benefit in dollars and cents by buying an American engine, and how long that engine will last for his work?


William Bunting Snowball: I am not a fisherman
and therefore cannot give a practical answer to my hon. friend's question. Members interested from the Maritime provinces may be able to deal with the matter more specifically. I may say, however, 5 p.m. that fishermen have told me that the engines they buy in the Maritime provinces have lasted only four or five years, whereas similar engines purchased across the line have been giving satisfactory service for fifteen or sixteen years and are still going strong.


Mr. ROSS (Kingston):: What engines of
Canadian make have failed?	.


William Bunting Snowball: The ones I refer to are manufactured in the Maritime provinces, at New Glasgow, Charlottetown and, I think, Yarmouth.


Mr. MARTELL:: May I call the hon.
member's attention to the fact that in certain parts of Nova Scotia the fishermen imported engines from Ontario, made by a certain firm called Adams at Penetanguishene, but they did not last two years in salt water.


Arthur Edward Ross: What was the name of the engine imported from Ontario?


Lewis Herbert Martell: It was manufactured by a company, formerly known as the Adams Company, at a place called Penetanguishene, or some such name, in Ontario.


William Bunting Snowball: I wish I were an expert, Mr. Chairman, so that I might satisfy my hon. friend. I am voicing the sentiments of the fishermen in my constituency, who tell me that they should have had this reduction granted to them last year when the duties on agricultural implements and machinery used in lumbering were reduced. However, I am glad that this boon has been granted to them at last. Every year it is becoming more important that our fishermen should get

further out from shore in following their business, and it is necessary that they should have their boats equipped with reliable gasoline engines so that when a storm comes up they may get back to shelter as quickly as possible; in fact their lives may depend on the efficiency of their engines. These men have told me that they should be able to buy the American engine, and they have asked for this reduction time and again; indeed, they would like to see the whole duty removed. I cannot see why any of our manufacturers who have been producing a satisfactory type of engine cannot continue to prosper under the small reduction of duty now proposed. We heard a great deal during the past year of the disaster that would befall the manufacturers of farming implements as a result of the reduction of duty on their output, but I do not think any hon. gentleman can name a single one that has gone out of business since that reduction went into effect. And I shall be very much surprised if, when we return to this House next session, the hon. member for Vancouver Centre will be able to tell us that owing to this reduction in duty the manufacturing concerns that he has referred to have been driven out of business. If they are manufacturing as good a type of engine as their American competitors, I am sure they will be in business for many years to come. Certainly I hope they will not go out of business, simply to demonstrate the fact that they are not able to manufacture a real highclass engine and hold their own with the engine turned out by their competitors in the United States.


Mr. SUTHERLAND:: Mr. Chairman, the debate on this resolution so far indicates that the old subject of protection versus free trade is going to be discussed all over again. My hon. friend who has just taken his seat (Mr. Snowball) says he cannot understand why the Canadian manufacturer cannot carry on under a low tariff or no tariff. I think the Acting Minister of Finance (Mr. Robb) gave a good illustration why in connection with the dumping clause of the Customs Act, dealt with a few minutes ago when he pointed out that on a certain date last year about a million pounds of butter, or forty carloads, had been imported from the United States at a time when the market there was glutted, and butter prices went down, but they went up there as soon as the surplus was dumped on our market. That very thing is happening all over this country, and is, I believe, responsible for the demoralized condition of trade which we find throughout the Dominion to-day.

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The question of the quality of some article which is manufactured in Canada arises, and we often hear it said, " Oh it is not of any use; it is not as good as it should be. If we could get something from some other country it would be very much better." We have heard that complaint time and again during the present sessien and in previous sessions. I do not like to hear that said of things which are grown or manufactured in Canada. I know that we are under a handicap in this country living alongside a very great and powerful neighbour which has seen fit to establish a very high customs tariff. When they have a surplus of anything in that country, rather than have their market break, or fluctuate they get rid of that surplus somewhere else, and that is the very thing that is happening in this country at the present time. The minister in connection with the dumping clause touched the crux of the whole situation. When forty carloads of butter are dumped into this Dominion, which should be able to produce enough butter to supply the small population we have, you can see here the very thing the people of this country are up against, and that is the very thing the manufacturer of these engines will be up against if you lower the tariff to the degree proposed under this resolution. I think it is a most dangerous course to pursue, but it is evident the government are . determined to proceed step by step until they gradually reach their objective. We heard minister after minister last session get up in the House and express the hope that the Step then taken indicated the ringing of the death knell of protection. To-day we have had the chief whip of the government party get up in this House and say he would gladly have welcomed the abolition of the whole tariff in connection with the articles coming in under this item, namely gasoline engines, but that it was at all events another step in the right direction, and consequently it was welcomed. Now if the government believes this is a good thing for the fishermen and others why not go the length and abolish the whole tariff? Rather than proceed step by step, why not go the whole way at once? Is it another case of the Indian who was going to cut the tail off his dog, and: decided to do so by cutting off an inch at a time so that it would not hurt so much? Is the government attempting to strangle industry in this country by degrees, and then come back here later on and say: Some of these industries have survived, so it cannot be as disastrous a step as the members of the opposition were predicting. Why not come out in the open and 199i
indicate what you intend to do? Do not be everlastingly harping upon this " step in the right direction If you believe it is a good thing, have the courage of your convictions, and introduce a measure which means what you intend to do, rather than adopt this slow process of strangulation.
I regret to hear so much about the inability of Canadians to manufacture goods that are the equal of those manufactured in the United States or elsewhere. So far as gasoline engines are concerned, I want to say that the manufacturers in this Dominion are competent to manufacture, and do manufacture gasoline engines, equal to anything that has been manufactured in any other country. We demonstrated during the war in the way of manufacturing munitions what we were capable of doing, something that the people did not believe it was possible for us to do-Rather than discourage our people, I think this is the time when it is necessary to-come out and encourage them to carry on and to put forth their maximum effort-Surely that is better than trying to frighten them and make them believe that even worse things are coming, and that if they have any capital they had better keep it out of business which ought to be employing people in this country. It is just another example of what has been going on for the last year or two, resulting in our workmen having to cross the line to find employment, and manufacturing over there the things that are required in this country, and many of these things manufactured bjr our own people in a foreign country come into competition with the goods produced in this country, under great difficulties which are continually increasing as a result of legislation similar to this resolution.


Mr. ROBICHAUD:: My hon. friend from
South Oxford (Mr. Sutherland) has made a brave attempt to compare the dairy industry in this country to the marine motor industry. While I do not profess to be an expert in marine motor engines, yet T was very much interested in the questions asked by some of the hon. members opposite of my hon. friend from Northumberland county (Mr. Snowball). It has been demonstrated that the life of the American-made motor is of longer duration than the Canadian made motor, and I believe that is true. I have often aaked myself the question why our Canadian manufacturers cannot manufacture as good an engine in Canada as they make in the United States, and in my humble opinion it is on account of our protective tariff. I truly believe that if the field were wide open, if our American competitors were allowed to sell their engines in
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Canada in open competition with the Canadian made article, our Canadian manufacturers would manufacture a better engine.
It has been asked where those engines of little duration were manufactured, whether in Ontario or Nova Scotia. I believe the Ontario engine is by far the poorest machine made in Canada, and that the engine manufactured in Nova Scotia is by far the best. The life of an engine, of course, depends entirely on the treatment it receives at the hands of its owner. One might be made to last for ten or fifteen years at the very most, but the average life of the Canadian made engine, is I believe ten years, whereas that of the American made engine would be not less than fifteen years.
Our fishermen have come to a point where they must equip their fishing boats with gas engines. In my constituency we have a very extensive fleet, known as the Caraquet fishing fleet, and the time has now come when these fishermen must equip their schooners with gas engines. The question has often been put by these fishermen: How long will these engines last? And when they were told they would last only eight or ten years at the most, they thought it was a poor business proposition. Then the question of buying American made engines was put up to them, and another objection was made by our fishermen, that the American made engine was by far too expensive because it was struck by a 35 per cent duty. Now with this reduction in tha tariff I believe our fishermen will be in a position to buy the American made engines to equip their schooners, so that they can cope with the American fishermen.
It has been stated that our fishermen should not be a preferred class. Why not, when they are suffering more than any other class in this country on account of the high tariff of the United States? Then again it might be stated that a high tariff is a good thing to protect the fishermen. I say not. In 1922, in the month of Septembe;, I think, I reached the New York market with four carloads of fresh fish. I had shipped them with a view to dodging the Fordney tariff. Unfortunately the fish were shipped in bond, and when they arrived in New York I was called upon to pay a tariff of 2 cents a pound. I went down on the fish pier to see if these fish could not be sold, and while I had to pay a duty of 2 cents a pound, the American fishermen were dumping the same class of fish on the same pier in the same fish market, for 1J cents a pound. That clearly demonstrates that protection after all does not protect the producer, but is simply a tax on the consumer.


Leon Johnson Ladner: I wanted to ask the minister, or perhaps the hon. member for Cape Breton South and Richmond (Mr. Kyte), if he could give me information in the first place as to what the duty on engines is today?


James Alexander Robb: I gave that information to
the committee earlier in the afternoon, but perhaps my hon. friend was not here then. The hon. member means the engines that are now under consideration?


Leon Johnson Ladner: Yes.


James Alexander Robb: Prior to the date of the presentation of the budget the rates were: 15 per cent, 25 per cent and 27i per cent. The new rates are: 10 per cent, 12i per cent and 15 per cent, and as a concession to the manufacturers we are giving them a rebate of 50 per cent on certain raw materials that enter into the manufacture of these engines.


Leon Johnson Ladner: Now could the minister,
or the hon. member (Mr. Kyte), tell us how much an engine costs?


George William Kyte: It depends entirely upon the horse-power.


Leon Johnson Ladner: Well, one with the customary horse-power?


George William Kyte: From $200 to $400.


Leon Johnson Ladner: And the hon. member for Northumberland (Mr. Snowball) informs us that a good engine will last sixteen years. Now that engine may be bought in Canada or in the United States, and there is compensation in either event. If bought in Canada the engine will have been manufactured here. If bought in the United States we shall have the revenue from the duty and we need the revenue. I think the Acting Minister of Finance will agree with me in that.


James Alexander Robb: Yes, I will agree with the
hon. member in that.


Leon Johnson Ladner: Now 25 per cent of $300
-taking the central figure of the three which the hon. member gave-would be $75. It is proposed to reduce that by $37.50. Hence the reduction that will be given to the fishermen if you distribute the $37.50 over a period of ten years will be $3.75 per year. That will be the amount which the fishermen will contribute to the tariff revenue of this country. On the other hand there is the desirability of retaining in the country all the industries to which the hon. member for Vancouver Centre (Mr. Stevens) referred. Now, to what extent-taking the complete operations of the fishermen for a period of ten years-

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taking his capital investment, what he earns and what he spends-is S3.75 going to affect him? He will never notice it.


James Alexander Robb: Now will my hon. friend just
follow out his argument and calculate the extent to which the 50 per cent reduction on raw material which we give is going to affect the manufacturer of engines.


Leon Johnson Ladner: It gives a certain advantage to the manufacturer, but we have here under their own signatures the statements of responsible firms in Vancouver, who presumably know their business, and they say "If you make these reductions, and make further reductions, you are going to put us out of business."


An hon. MEMBER:: Do they not all say
that?


Leon Johnson Ladner: Yes, they all say it and
the industries of the country are being put out of business. Everybody knows it, and the government will know it too when the general elections come.
Noiw, Mr. Chairman, the hon. member for Saskatoon (Mr. Evans) gave us the benefit of some theories on free trade. The trouble is there is too much theory talk. We have here an actual condition. The duties on engines, which affect the fisherman only to the extent of S3.75 a year, are being reduced and in doing that the government will not only put out of business these two, three or more industries in the city of Vancouver, as well as others elsewhere in Canada, but they will cause people with capital to invest to ask themselves whether it is desirable to invest in Canadian industries in view of the uncertainly of the policy which the government follows-taking two steps forward one year in a downward direction and another step in another direction; then next year it may be half a step, or two steps, again in the direction of lowering the tariff. Looking at this matter from the point of view in which a business man would look at it, is it in the interests of this country to save the fisherman $3.75 on his capita! investment in the fishing ente'

prise and put out of business the manufacturers of these engines? Is it wise to force these people who have put their capital into the business to lose it; and worse still, is it wise to create such fear in the hearts of people desirous of investing capital in industries in other parts of Canada that they will refrain from taking that step?


Lewis Herbert Martell: Is it not a fact that the things which are used by fishermen generally, even the luxuries, pay the highest pro rata
duties into the treasury, at any rate duties much higher than the average manufacturer pays?


Leon Johnson Ladner: I do not think that is
correct at all.*


Lewis Herbert Martell: I think it is.


George William Kyte: The comparison the hon. gentleman has addressed to the House in regard to the saving to a fisherman by a reduction of the duty has reference to only the boat that has been built and the engine purchased. My hon. friend has left out of account the number of boats that will require to be built from year to year upon which there will be a saving of $37.50 in the case of each engine costing $300. Now, in the Maritime provinces we are endeavouring to develop our fisheries. Unfortunately during the last ten years a great many of our fishermen gave up fishing and went away to the United States. Now we are trying to get them back, and there is a very considerable return movement on the part of those expatriated fishermen from the Maritime provinces. These people will require boats to carry on their vocation.


Leon Johnson Ladner: Does the hon. member
seriously, as a responsible individual, suggest that the prospect of saving $3.75 a year on a gasoline engine will bring the fisherman back?


George William Kyte: No, but the prospect of returning to Canada and living under a Liberal government is bringing them back. They are going to engage in their former occupation, and they will require fishing boats, they will need to purchase engines, and each one of these men will save $37.50 upon every engine that he buys. My hon. friend with the true instinct of the Conservative is not thinking of progress, of advancement. He is thinking only of the conditions to-day; he is not thinking of the men who are looking to the future and who wish to contribute towards the development of our industries.


Leon Johnson Ladner: Hon. gentlemen opposite
are thinking of votes.


George William Kyte: Let me emphasize the point
that it is upon the new boats that the saving will be made. A large number of engines for these boats will be purchased in the Maritime provinces in the present and succeeding years.
Now, my hon. friend refers to the reduction of duty as being somewhat in the nature of an economic triumph. Does he not know that when his own leader entered parliament, or in the second session following that entry, he

Ways and Means-Customs Tariff moved to reduce the duty on agricultural implements very considerably? I presume my hon. friend will not think that his leader was wrong in taking that action? Furthermore, the late government, representing the party which my hon. friend supports made a reduction in the duty on agricultural implements a few years ago. Had my hon. friend been in the House at that time he would have supported that policy. Now if it was a good thing to make reductions from time to time in the duties upon the implements that are used in the agricultural industry-


Leon Johnson Ladner: I doubt whether it was.


George William Kyte: -surely it cannot be a bad thing to reduce the duty upon the implements used in the development of our fishing industry?


Mr. NEILL:: Perhaps, it is right that I, as representing some of the fishermen on the Pacific coast, should speak on this question. I may say that the hon. member for Skeena (Mr. Stork) is at present engaged in the Ocean Freight Rates committee, otherwise I am sure he would be here to lend his views in support of the fishermen whom he represents in common with myself. When speaking in the budget debate I dwelt on this matter, and indicated the advantage that would result to the fishermen not only from the remission of this particular tax, and some remissions made on the twine used in connection with their nets, but also from the reduction in the sales tax. I do not think there is any very great danger to be apprehended of these manufacturing industries in Vancouver going out of business immediately. It is a curious fact that they are always going out of business when reductions in the duties are suggested. Nevertheless they are still here, and they pop up year after year, and session after session, with the same old wail that they are going out of business unless something is done. However, we find them still here, and still complaining that they are losing money.


Leon Johnson Ladner: Since a reduction of duties has proved so beneficial in the opinion of my hon. friend, would he advocate the total elimination of duties in the case of all manufacturing industries?


Alan Webster Neill: When I was speaking on the budget I said the hon. members of this House had spent something like sixty per cent of their time debating the everlasting question of tariff protection versus free trade, and I did not propose to be drawn into a discussion of that abstract question. I can only 
deal with situations as they arise. I am now dealing with the proposed partial remission of tax on engines used in the fishing industry on the Pacific coast. The duty has not been taken off altogether. The manufacturers still have a duty, and it is such a duty that it will give them a living chance. The hon. member for Vancouver South (Mr. Ladner) endeavours to minimize the .benefit to the fishermen, and figures out by some abstract method of reasoning that the fisherman only benefits to the extent of $3.75 a year. On the Pacific ocean-I do not know anything about the doings on the Atlantic ocean-when we buy engines we pay for them, and do not spread the) payments over ten or sixteen years, and if the hon. member for Northumberland (Mr. Snowball) was correctly represented by the hon. member for Vancouver South, when he is supposed to have stated that the average life of a gasoline engine on one of these boats is sixteen years, I beg to differ with him. That is a mistake to my mind. They have not been in general use for sixteen years to begin with, and I know of cases where six years would be more likely to be the average life than sixteen. But that is certainly an exaggerated statement of the life of such an engine. Not only the engine itself but the parts that go with it have to be renewed from time to time.
We hear about encouraging basic industries. In the estimates of the Minister of Marine and Fisheries (Mr. Cardin) we saw quite a large item running into hundreds of thousands of dollars for the encouragement of deep-sea fishing. I think some of it used to be spent for paying part of the freight on fish, in order to enable them to ship it to the centre of the continent; but here is a readier and cheaper way of encouraging deep-sea fishing on the coast, iby enabling tiheml to; get tools at something nearer a reasonable price, in order to prosecute their industries. The market of the fishermen is a good deal like the wheat market of my hon. friends to my left. The product has to be sold, not perhaps in the world market, but in the market of the United States. That market governs the price at which the great bulk of the commodity has to be sold. The amount of halibut consumed in Canada is negligible compared with the amount consumed in the United States. That is where the market lies, and when the American fishermen and the Canadian fishermen go out side by side, the banks being in neutral waters, they have to compete. The American has his boat, equipment and all the material necessary without paying any duty at all. The Canadian has to pay a heavy duty and

W-ays and Means-Customs Tariff
ia handicapped at the start. When they come into port with their fish, the American fish go through Canada in bond to the eastern states market, free of duty, and the Canadian has to pay a duty of two cents on his fish going into the United States. He is handicapped in that way also. What is the result? Canadians go over to the other side, and they have been going over in hundreds and thousands during the last fifteen years. A large number of Canadian fishermen can now be found operating in Seattle, on account of the economic conditions to which I have referred, both as regards the tax on fish and the other conditions. We hear about Canadians going over to the States and we are urged to find means to stop them and to encourage them to come back. The way to encourage them to come back is to make conditions by which they can compete with Americans in the common market of both of them, which is the United States.
Another feature I should like to mention is that this reduction is one which will tend to reduce the cost of living. -One of the greatest things statesmen strive for is to reduce the high cost of living. If you reduce the cost of production in a basic industry- and fishing is one of the basic industries- you will cheapen the price to the -consumer, and that is what the people of Canada want. They want a cheaper cost of living. When my hon. friend from Vancouver South asked a question, he expected a negative answer, but I will give him a different answer. He asked, is it in the interests of Canada to do this? I say yes, it is in the interests of Canada to cheapen the cost of production ai>^ keep Canadian -citizens in Canada.


Mr. BLACK (Yukon):: Does this include
steam engines and oil burning engines, as well as gasoline engines, when used for the purposes set out in the schedule?


James Alexander Robb: Yes, it reads:
"Engines to be used exclusively in the propulsion of boats bona fide owned by individual fishermen for their own use in the fisheries, under regulations prescribed by the Minister of Customs and Excise".


George Black: Is not the class
of engine known as the Diesel, which is an oil burning engine, free now when used for marine purposes, and if that is so, will not this provision place a duty on it?


James Alexander Robb: No.


George Black: How can you -escape it?


James Alexander Robb: It comes in under another
item, 470.


Jean George Robichaud: The item reads:
Engines to be used exclusively in the propulsion of boats bona fide owned by individual fishermen for their own use in the fisheries, under regulations prescribed by the Minister of Customs and Excise.
In some Cases you have to draw a -line between a vessel owned by a private individual and one owned by a trader or a man engaged in the fishing industry. Some are owned by fishermen and others owned jointly by fishermen and by dealers In Nova S'cotia the large bankers are owned jointly by fishermen and traders. I should like to know whether this provision would be the cause of any misunderstanding.


James Alexander Robb: No, I would not think so. We consulted the Department of Customs; -this paragraph was so framed for administrative purposes, so that the man who had a large yacht would not get the advantage of it.


Henry Herbert Stevens: A very important point
has been raised by my hon. friend. If Diesel engines were, as my hon. friend from the Yukon point 'out, put on the free list for fishing purposes last year there would be a very great danger of them being taxed under this item. What is the item under discussion?


James Alexander Robb: Diesel engines are under item 470.
Mr. -STEVENS:	I would like to check
that up. It is a rather important matter. Item 470 in the tariff I think reads "Iron or steel masts."


James Alexander Robb: It says:
And iron or steel manufactures which at the time of their importation are of a class or kind not manufactured in Canada when imported for use in the construction or equipment of ships or vessels.
I can assure my hon. friend it is amply covered.


[Stage Direction]
Item agreed to.
Customs tariff-469a. Well-drilling machinery and apparatus and parts thereof, and rope twenty-one hundred feet and over in length, capable of drilling wells of two thousand feet, and over in depth, of four inches and over in diameter, and of raising and lowering casing over four inches in diameter for such wells, for drilling for water, natural gas and oil, and for prospecting for minerals, not to include motive power: British preferential tariff, 5 per cent; intermediate, 5 per cent; general, 5 per cent.
Mr. GARDINER:: What is the previous
tariff on this item?


James Alexander Robb: Well there are some clauses involved in it. The proposed rates are five
r	COMMONS
Ways and Means-Customs Tariff
per cent, five per cent and five per cent. The previous rates were:
British
Preferential Intermediate	General
Tariff	Tariff	Tariff
Per cent Per cent Per cent
453	
15	26	27J408	
17J	221	25454	
20	271	30548	
20	221	25
And the sales tax will also be taken off.


Mr. FANSHER:: Why is there a limit put on well drilling machinery capable of drilling wells over 2,000 feet in depth?


James Alexander Robb: That was after conversation with people who were interested in the development of the deep wells, and they are satisfied this will give them the relief they desire.


Burt Wendell Fansher: I notice in the previous item the minister has given a reduction in the materials that enter into the production of those items. He will remember that last-year there was a reduction of one-half of the bounty that was given to assist the oil producer, and on the last of June of this year the other half goes off. Most of the oil is produced from shallow wells, and the machinery that is used is not machinery such as is used to drill a well to a depth of 2,000 feet. Most of the oil produced in Canada at the present time is from wells between four and five hundred feet in depth. Last year the assistance in the shape of a bounty was reduced. Why not reduce the duty on the implements that enter into the production of crude oil?


James Alexander Robb: There has been no such request. As a matter of fact our information is that the same people who have the wells largely manufacture the machinery. My hon. friend will observe also that in this item we are providing for a rebate of 99 per cent on the materials entering into the manufacture of this machinery.


Robert Gardiner: Has the minister taken into consideration the advisability of reducing the tariff on engines used for the purpose of running this well drilling machinery?


James Alexander Robb: I have not taken that into
consideration.


Robert Gardiner: Such reduction would
be appreciated by people who have to buy this class of machinery. The cost of the power is a great deal more than the cost of the well drilling machinery. If we are to develop our oil industry in Alberta, I would suggest that the minister consider the advisability

of reducing the tariff on engines required to operate these drills.


Mr. JELLIFF:: I would like to impress
upon the minister the idea expressed by the hon. member for Medicine Hat (Mr. Gardiner). These oil drilling outfits -might properly be termed units. The different parts are built to work together in harmony; they are harmonized as to power, weight and stength. This is a good deal like letting in free or under a low tariff a clock or a watch with the mainspring left out. The reduction might well be made on the motive machinery as well as on other parts of the well drilling outfit.


George Gibson Coote: Might I emphasize that point as well, for the particular reason that in the state of Montana, just across the line, quite a number of professional well drillers, who own their outfits and who, I think, would in many cases like to come across to Alberta to drill wells for those who have leases in that district, under the present arrangement will be allowed to bring in their drill, but they must pay a duty of possibly 25 or 27J per cent on the power attached that naturally belongs to that outfit? Although I would like to commend the minister for reducing this tariff to 5 per cent, he has fallen a little short in his duty in this regard.


James Alexander Robb: We do that frequently.


George Gibson Coote: I would like to see him include the motive power with these drills. The motive power that is put out with the drill when it is made is of the right size and capacity to run that drill. Sometimes, it is a little difficult for a driller in Canada to get the Canadian power that entirely suits his drill. I should like to impress that upon the minister, and I hope he will yet see his way to include the power with these well drilling outfits.


Mr. WARD:: When the minister is considering the engine, I would like to suggest that he should change his regulation to include small drills for drilling wells for water. I cannot see why he should allow a drill drilling a four-inch hole to come in free and not a drill drilling a two-inch hole. There are many wells in western Canada that do not require to be drilled to a depth of two thousand feet. They go down three or four hundred feet drilling wells for water for farming, and such drills are entitled to just as much consideration as the oil drills.


Burt Wendell Fansher: While I appreciate very
much the intention of hon. members from Alberta in trying to get a reduction in duty

Ways and Means-Customs Tariff
on the whole outfit, I still claim that most of the oil produced within the Dominion of Canada is produced from shallow wells, and that the machinery required to drill such wells is not the machinery that would be required to drill a well two thousand feet deep. Therefore, it would not come under this item. We well remember the reduction in the assistance in the shape of a bounty to the oil industry. The principle was established in the budget of last year that where a reduction was made in the protective tariff, a like reduction was made on the materials entering into the production of those goods.
I think, in this instance, a reduction should have been made on the goods entering into the production of crude oil. That branch of the industry is left now without any assistance. While the refining branch is given assistance. We have no reduction in duty on the tools which are required to drill these wells, neither have we any reduction in the duty on the goods that are required to maintain these wells. There is a large quantity of casings, tubing, rods, brass cups, couplings and the like upon which there is a heavy duty, and carrying out the same principle that was carried out last year, a reduction should be made in the duty on these items.


Mr. LEADER:: I should like to back up
what some hon. members have said about well drilling machinery used in drilling for water. I know something about that as I have had to go down two hundred feet for water for the animals on my farm. Last year when casings over four inches were exempted from the sales tax, I did not say anything, although I felt the government should have gone further and given the same exemption on casings used in wells for water. The present is not too late to amend that. Many farmers in western Canada especially have to drill to find water for their animals. This entails a great deal of expense. Many times they drill for three or four hundred feet, striking stone, and they must take their machinery out and drill somewhere else. Sometimes they drill for days or weeks without accomplishing their purpose and their expense is all for nothing. It is only fair to the farmers of western Canada, and, indeed, of all Canada, who are similarily situated in that regard, if the government would include well drilling machinery for drilling wells of any depth, for water, as well as oil.


Burt Wendell Fansher: In view of the fact that
the minister made an investigation of the oil industry, has he considered the idea of reducing the duty on the goods that enter into the production of crude oil?


James Alexander Robb: I had officials of the department go through the oil wells in western Canada and the demand was more for a bounty than for any change in the duty. I have listened to the observations of hon. gentlemen this afternoon and I shall refer all this to the tariff inquiry board to go carefully into it. I am not prepared to make any further concessions this session.


George Black: On what principle does the minister admit free the Diesel engine for marine purposes and tractors when used for farming purposes, and charge a duty on both when used for mining? Is it not just as necessary, if the tariff is changed for the purpose of helping industry, that the change should apply to mining as well as to other industries?


James Alexander Robb: My hon. friend will observe
that it referred to a class or a kind not made in Canada. My recollection is that when we made the change in regard to mining duties last year my hon. friend was not very enthusiastic over it.
Mr. BLACK (Yukon) The minister is entirely mistaken; I made no remarks on the matter one way or the other. I had correspondence with him in which I asked a question and the reply was merely that my suggestion was noted. I certainly think that where gasoline tractors are admitted free for farming purposes they should be admitted free, on the same principle, for mining purposes. Farms were carried on successfully many years before they used tractors, but in some of the remote parts of the country much difficulty would be experienced in mining if they had not the gasoline tractor for freighting and hauling ore. And the industries in those sections are much more in need of encouragement than is the ordinary farmer to-day. These engines are used for power purposes in these localities where there is no fuel supply and they cannot obtain hydro power. I submit that if the government is going to reduce the tariff on principle to help industries it should make reductions in this case. Of course, if the object is merely to get votes in various localities it is a different thing. Certainly, if the government is really anxious to help industries, the mining industry can be helped in this way.


[Stage Direction]
Item agreed to.
Customs tariff-553a. Braided candle-wick with or without wire centre or braided taper-wick with or without wire centre when imported by manufacturers of wax candles or wax tapers for use only in their own factories in the manufacture of wax candles or wax tapers: British preferential tariff, free; intermediate tariff, free; general tariff, free.
3112	^	COMMONS
Ways and Means-Customs Tariff
Henry Herbert Stevens: What was the duty on
this before?


James Alexander Robb: This is a reclassification; it
came under 25 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-588. Coal, bituminous and coal, n.o.p., per ton: British preferential tariff, 35 cents; intermediate tariff, 45 cents; general tariff, 50 cents.
Henry Herbert Stevens: Would this change bring
slack coal up to the level of ordinary run of mine?


James Alexander Robb: This reduces the ordinary run of mine coal 3 cents per ton, making it 50 cents, and it brings the slack coal up to that. It wipes out the slack coal item altogether.


Henry Herbert Stevens: Which previously was
free?


James Alexander Robb: No, 14 cents.


James Shaver Woodsworth: I should like again to call attention to the fact that at this very time we have a good deal of trouble in the coal mining area of Nova Sootia, and it has been said by the government that there is some difficulty in their taking action. I cannot myself see the grounds of that difficulty, but it has been stated that the government is more or less precluded from action because of the decision of the Privy Council with regard to the Industrial Disputes Investigation Act. Be that as it may, the fact is that there is a serious difficulty there and this government cannot avoid all responsibility in the matter. There is clearly one course that could be taken to force an investigation. Statements have been made by the miners with regard to the situation while other statements have been made by the operators. There is no evidence whatever before the public that if further protection is granted the operators it will be any help to the miners themselves. Further than that, there is no guarantee whatever that protection to the miners will mean any help at all to the consumers of coal. Under these circumstances it would seem absolutely essential, before the government or parliament can act intelligently, that there should be a fact-finding commission. It seems to me that this is due the public at large, and it is also due parliament before we are asked to vote on the matter. I should like to urge that it is the responsibility of the government to bring before us absolutely reliable statistics as to the cost of mining coal and as to the whole of the financial arrangements connected with the British Empire Steel Corporation before the public is asked to give further assistance in this matter.


John Evans: I cannot help thinking that this duty on coal is very ill-advised. The government would have done much better to have accepted reciprocity in the matter of coal with the United States, who offer free trade in this commodity to all who will reciprocate. I cannot help thinking that coal, all the way across Canada, will be dearer for the householder than it has ever been. The natural market for coal for eastern Canada is in the Maritime provinces as well as in the New England states, and the natural market for Alberta coal is to the south and in the three prairie provinces. I think it is futile to spread Canadian coal over the whole of the Dominion either by means of a duty or by a railway subsidy. I think it is well established that even with this duty matters will not mend very much in Nova Scotia. There seems to exist there a situation which it will take more than 50 cents of a duty per ton on coal to overcome. There we see day after day an outrage committed against men, women and children which is besmirching the fair name of the British Empire. No British fair play is shown to the operatives in that area, and I think that their very nakedness and the suffering of these people are simply used as a lever to extort a high duty on coal for the benefit of the mine owner. The whole thing is wrong. Along with my hon. friend (Mr. Woodsworth) I want to see some interference on the part of the government in behalf of these operatives. It is time we took the matter in hand, and if the pride of Nova Scotia will suffer in consequence then I think the people there will have to pocket their pride for the time being. Certainly a duty rests on the government to interfere and put an end to the awful conditions now prevailing in Glace Bay.


[Stage Direction]
Item agreed to.
Customs tariff-588a, Gas for heating, cooking or illuminating, per one thousand cubic feet: British preferential tariff, 6 cents; intermediate tariff, 6 cents; general tariff, 6 cents.
James Alexander Robb: I move that the item be
amended by adding after the word "illuminating" the words "by pipe line."


Henry Herbert Stevens: What is the reason for this change, and what is the present duty?


James Alexander Robb: 
Henry Herbert Stevens: What is the difference?


James Alexander Robb: It was 17i per cent on the value; now it is six cents per 1,000 cubic feet.


Henry Herbert Stevens: What is the approximate value?


James Alexander Robb: Sixty cents at Niagara, two dollars at Calais, Maine.


Henry Herbert Stevens: This would be 10 per cent at Niagara.


James Alexander Robb: About that.


Henry Herbert Stevens: Is very much imported?


James Alexander Robb: Only at St. Stephen from
Calais, Maine. Now there is a request to import it from a point near Niagara.


Henry Herbert Stevens: In the past the duty has been a dead letter, and this is virtually a new duty?


James Alexander Robb: Yes. We are changing it so it may be properly administered.


Mr. WHITE:: Will this cover natural gas as well as artificial?


James Alexander Robb: Yes.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-591. Farm wagons, farm sleds, logging wagons, logging sleds, and complete parts thereof: British preferential tariff, 5 per cent; intermediate tariff, 10 per cent; general tariff, 10 per cent.
Thomas Wakem Caldwell: What was the former duty on this item?


James Alexander Robb: We are adding the words "logging sleds ". The duty before was 25 per cent.


Richard Smeaton White: What is the difference between farm sleds in this item and sleighs contained in the next item?


James Alexander Robb: It is the expression used by the customs for administrative purposes.


Henry Herbert Stevens: Just for the sake of harmony-


An hon. MEMBER:: Hear, hear.


Henry Herbert Stevens: I mean harmony in language. I do not care much about the harmony of the House, in fact I think a little bit of spice once in a while is a very good thing. Will the minister look at the two items: logging wagons, 5, 10 and 10 per cent, and then below sleighs-which I presume will be logging sleighs

17^, 25 and 25 per cent? Why should there be a duty on the wagon of 10 per cent, and on the sleigh of 25 per cent. It sounds to me a little unreasonable
and-well, scarcely sound common sense. Why not make them all 25 per cent?


James Alexander Robb: I have discussed this with the customs, and they claim that they can administer it and understand it better this way.


Henry Herbert Stevens: I admit that the customs officer's administrative mind is so trained to draw fine distinctions that he might understand it, but I defy any person of ordinary intelligence like myself to do so.
At six o'clock the Speaker resumed the chair and the House took recess.
After Recess
The House resumed at eight o'clock.


PRIVATE BILLS
[Stage Direction]
Bill No. 78, for the relief of Vera Thelma Gooderham.-Mr. MacLaren.
Bill No. 99, for the relief of William John Fuller.-Mr. Duff.
Bill No. 100, for the relief of Alfred Augustus Jacques.

Mr. Duff.
Bill No. 101, for the relief of Paul Zizis.- Mr. Hocken.
Bill No. 102, for the relief of Annie May Blunt.-Mr. Hocken.
Bill No. 103, for the relief of Grace Harrington Bloom.-Mr. Hocken.
Bill No. 104, for the relief of Ian Somerled Macdonald.-Mr. Garland (Carleton).
Bill No. 105, for the relief of Arthur Beldon Morrison.-Mr. Church.
Bill No. 106, for the relief of George Edward Sharp.-Mr. Arthurs.
Bill No. 107, for the relief of Marjorie Morton.-Mr. Arthurs.
Bill No. 108, for the relief of William Ernest Hampson.-Mr. Arthurs.

[Stage Direction]
Bill No. 26, respecting a patent of Walter W. Williams.

Mr. McMaster.
Bill No. 48, for the relief of George Thomas Grigor.-Mr. Martell.
Bill No. 49, for the relief of Ethel May Sheriff.-Mr. Church.
Bill No. 50, for the relief of Max Arno Frind.-Mr. Hocken.
Bill No. 51, for the relief of Elizabeth Burns.-Mr. Garland (Carleton).
Bill No. 52, for the relief of Fred Herdman Ogden.-Mr. Church.
Bill No. 53, for the relief of Marion Gooderham Smith.-Mr. Hocken.
Private Bills
[Stage Direction]
Bill No. 54, for the relief of Edith Mary Wiles.-Mr. Garland (Carleton).
Bill No. 55, for the relief of Annie Kate Winch.-Mr. Hanson.
Bill No. 56, for the relief of Florence Kate Coutts.-Mr. Ryckman.
Bill No. 57, for the relief of George Kerr Jess.-Mr. Hanson.
Bill No. 58, for the relief of Thomas Aimer Shields.-Mr. Euler.	.
Bill No. 59, for the relief of Roderick James Ellis.

Mr. Boys.
Bill No. 60, for the relief of Florence Mann. -Mr. Sheard.
Bill No. 61, for the relief of Samuel John Pegg, junior.-Mr. Preston.
Bill No. 63, for the relief of Izzie Klin-mentz (otherwise known as Izzie Climans).- Mr. Jacobs.
Bill No. 64, for the relief of John Hutchinson Durnan.-Mr. Sheard.
Bill No. 65, for the relief of Richard James Wright.-Mr. Garland (Carleton).
Bill No. 66, for the relief of Mary Ellen Ayre.-Mr. Boys.
Bill No. 67, for the relief of Helen Marie Pritchard.-Mr. Garland (Carleton).
Hewitt Bostock: I might, perhaps, ask the House if I could not embody the motions for the third reading of these bills in one resolution in order to save time?


Some hon. MEMBERS:: Carried.


Hewitt Bostock: By leave of the House. It is moved by Mr. McGiverin seconded by Mr. Mackinnon that the bills be read a third time. Is it the pleasure of the House to adopt the motion?


Mr. LAPOINTE:: On division.


Hewitt Bostock: Carried on division.


BRITISH CONSOLIDATED INSURANCE CORPORATION
[Stage Direction]
Mr. WILLIAM IRVINE (East Calgary) moved the second reading of and concurrence in amendments made by the Senate to Bill No. 34, to incorporate the British Consolidated
Insurance Corporation.
Ernest Lapointe: Will the hon. gentleman tell us what the amendments are?


Hewitt Bostock: I see by the amended
bill that the only change is in the phraseology.
The word "insurance" is replaced by the word "assurance" in two places.


Mr. IRVINE:: That is the only change.


Mr. SPE AKER:: With this assurance is it the pleasure of the House to adopt the motion?


[Stage Direction]
Motion agreed to.

[Stage Direction]
The House in committee of Ways and Means, Mr. Gordon in the chair.
Customs tariff-591. Farm wagons, farm sleds, logging wagons, logging sleds, and complete parts thereof British preferential tariff 5 per cent; intermediate tariff, 10 per cent; general tariff, 10 per cent.
["The complaint must come from some men who are dodging taxes.\nMr. LADNER' It is from the Credit Men's Association of Canada.\nResolution 10 (a) agreed to.\nResolution 10 agreed to.\nResolution 11 agreed to."]
Robert Alexander Hoey: Is there any change in the farm wagon item?


James Alexander Robb: No, the only change is to
insert the words "farm sleds." [DOT]


[Stage Direction]
Item agreed to.
Customs tariff-591a. Freight wagons, drays, sleighs, n.o.p., and complete parts thereof; British preferential tariff 171 per cent; intermediate tariff, 25 per cent; general tariff, 25 per cent.
['No, the only change is to\ninsert the words "farm sleds." [DOT]']
James Alexander Robb: The only change is to add
the words "n.o.p."


[Stage Direction]
Item agreed to.
Resolution agreed to.

[Stage Direction]
3.	Resolved, that schedule B to The Customs Tariff, 1907, be amended by providing that the following items, enumerations, and rates of drawback of customs duties be inserted in said schedule B:-
Customs tariff-1045. Materials when used in the manufacture of tubes enumerated in tariff item 397,- payable as drawback, 99 per cent.
Item agreed to.
Customs tariff-1046. Materials when used in the manufacture of articles entitled to entry under tariff item 663b, when such articles are sold to manufacturers to be used as specified in said item,-payable as drawback, 99 per cent.
Mr. LUCAS:: What are the conditions
which a manufacturer has to comply with in order to receive this drawback?


James Alexander Robb: The general regulations apply
to drawbacks and they are given on goods imported within three years. The item is to provide for a drawback on materials used in the manufacture of machinery and other articles entitled to free entry under tariff 663.


William Thomas Lucas: Does that apply to material
imported to be manufactured into goods which are for export?


James Alexander Robb: No this item is to apply particularly to the machinery for manufacturing fertilizers. The machinery is now free and it is to give them a rebate on the material going into the machinery, to put the Canadian in as good a position as the foreign dealer.


Mr. SPENCER:: Is that drawback given
on machinery manufactured and sold in Canada as well as on what is exported?

Ways and Means-Drawbacks


James Alexander Robb: Yes.


[Stage Direction]
Item agreed to.
Customs tariff-1047. Materials when used in the manufacture of articles enumerated in tariff item 469a-payable as drawback 99 per cent.
Item agreed to.
Customs tariff-1048. Materials, including all parts,
when used in the manufacture of goods enumerated in tariff item 453e-payable as drawback 50 per cent.
Richard Smeaton White: Before six o'clock, when the
items covering engines, well drilling machinery and farm sleds were under consideration, the minister stated that, on account of the reduction of duties, the manufacturers of these articles were allowed certain drawbacks on materials as covered by the next page. What consideration is being given to the makers of these materials?


James Alexander Robb: I think we made some concessions last year covering that. I will get the information for my hon. friend.


Richard Smeaton White: And withdrawn this year?


James Alexander Robb: No, excepting in the alloy
rolls.


Arthur John Lewis: Why is it that when a manufacturer manufactures a commodity that is on the free list, he is given the privilege of a drawback of 99 per cent of the tariff on all the raw material that goes into it, while on the other hand the farmers who are manufacturing as primary producers all the time and whose goods are all on the free list, do not get a drawback of 99 per cent on the things which they require in order to produce their goods?


James Alexander Robb: My hon. friend seems to forget that we made a good many reductions last year on implements, particularly for farms, and that we are adding to the list this year.


[Stage Direction]
Item agreed to.
Customs tariff-1049. Bituminous coal when imported after the 24th day of March, 1925, by proprietors of by-product recovery coke ovens and converted into coke at their by-product recovery coke ovens. Provided that no drawback shall be paid under this item during any calendar month when the average ratio during that period is less than 1,300 pounds of coke from 2,000 pounds of coal, also provided that drawback payable under this item is in lieu of drawback payble under any other item-payable as drawback 99 per cent.
James Alexander Robb: I beg to move that the following be substituted for item 1049:
1049. Bituminous coal when imported after the 24th day of March, 1925, by proprietors of by-product recovery ovens and converted into coke at their byproduct recovery coke ovens. Provided that no drawback shall be paid under this item-
This is new:
-on coal converted into coke at a gas retort plant or at a plant using any other process than the by-product recovery coke oven process.


Donald MacBeth Kennedy: What is the reason for that change and what general effect will it have?


James Alexander Robb: The reason is to give this
advantage only to plants that are making exclusively coke as a by-product.


Robert Gardiner: Producing coke for
fuel?


James Alexander Robb: Yes.


Thomas Langton Church: What is exactly the policy of the government? This afternoon we passed a resolution in reference to bituminous coal and coal n.o.p., British preferential tariff, 35 cents per ton; intermediate tariff, 45 cents per ton, and general tariff, 50 cents per ton. In my opinion that resolution passed this afternoon and this item in connection with the drawback on bituminous coal are not fair and equitable for the whole of Canada. It may be that the minister may be trying to give some stimulus to the coal industry in Nova Scotia, but there has been a great deal of discussion in parliament in regard to a national policy on this coal question and equality of treatment for both Alberta and Maritime coal. I was much surprised this afternoon, in view of that resolution and the drawback item of 99 per cent, that my friends the Progressives from Alberta did not ask for the same treatment which the Maritime provinces are getting. The resolution passed this afternoon and this item in regard to the drawback of 99 per cent have to be read together, and I claim that they constitute a clear discrimination against Ontario. This duty is going to cost the people of Ontario, it is estimated, between 81.500.000 and $2,000,000. The people of Ontario would gladly use Nova Scotia coal, as was pointed out in the debate on the coal question, but they cannot use it on account of the transportation question at the present time and many other questions connected with it. This is clear discrimination in favour of Nova Scotia at the expense of Ontario and Alberta as well. I do not understand this silence on the part of my hon. friends to my left who are much interested in this coal problem, in both the duty and the drawback and in getting Alberta coal to central Canada.
I fail to see that there is equality of treatment. It is class discrimination of the worst kind at Ontario's expense. The government should bring down a national policy giving
Ways and Means-Drawbacks

equitable treatment to all parts of Canada, instead of levying an imposition of 12,000,000 a year on the people of Ontario for the benefit of the people of Nova Scotia. This is not a solution of the coal question. It is the mere absence of a proper policy. It is not carrying out the resolution adopted unanimously by this House at two sessions of this parliament for a national policy on coal for Canada. It is simply benefiting one section of the country at the expense of another. As regards these coke ovens, although this may not be in the minister's department-it may be in that of the Minister of the Interior-the minister ought to tell the committee the names of the coking plants benefited by this drawback proposition and where they are. They may be only in certain parts of Canada. I am very much disappointed at the silence of the Progressive members from Alberta, the so-called Ginger group in this House and the way they follow the government. It does not seem as if they had very much ginger or progress in their make-up. This afternoon they said not a word as to the adoption of this discriminatory policy on the tariff. If there is to be any tariff or drawback at all on coal, it should be equitable not only for Nova Scotia, but for Ontario and Alberta as well. Ontario is also penalized on well drilling machinery. Last year a resolution was passed providing for $200,000 bonus for the benefit of the coal industry, and not a cent went to Alberta. Nevertheless, hon. gentlemen from that province sit here and say nothing. I do not see why the government could not bring down a fair and equitable national policy on coal and a policy of protection for the whole country. I am surprised that the Conservatives and Progressives of Ontario, especially those coming from the cities and towns, should allow a resolution of this kind to go through without protest, when this means that 12,000,000 will be taken out of the pockets of the hard-working people of Ontario.


Arthur John Lewis: I am glad for once that protectionist Toronto knows what it feels like to be taxed for the benefit of some other class of people. If there was ever any insincerity in protection, we have heard it to-night. The people who believe in protection and who are willing to tax the whole of Canada for the sake of the few, when the thing is turned around upon themselves, are the first to howl.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Resolution agreed to.
Resolution 4 agreed to.

Mr. ROBB moved:: 1.	That "cheque" shall be further defined to include any document or writing, not drawn upon or addressed to a bank, in exchange for which a bank makes payment of a sum of money, except a coupon and a document used solely for the purpose of settling or clearing any account between banks, and that such a cheque shall be liable to the stamp tax imposed on cheques by the said act.
2.	That a bill of exchange transferred or delivered
to a bank drawn upon a person outside of Canada shall, for the purpose of the value of the stamp to be affixed thereto,	be	deemed to	be	drawn for an
amount not exceeding twenty-five hundred dollars.
3.	That no person selling foreign exchange shall for the purpose issue a bill of exchange drawn upon a person outside of Canada unless there is affixed thereto a stamp of the value of two cents for every fifty dollars up to twenty-five hundred dollars.
4.	That the stamp tax imposed by the said act
on money orders	or	traveller's	cheques shall besimilarly imposed	on	money orders	or traveller's
cheques issued by a bank or other person.
5.	That any bill of exchange or promissory note held
by a bank as collateral security for an advance or other indebtedness	and	in respect	of	which advance
or other indebtedness stamps of the requisite value under this section are affixed to the relevant bill, note or other proper document, shall not be subject to the provisions of this section. If such collateral is paid by a person liable thereon stamps of the requisite value according to subsection 3 (a) of this section shall before surrender thereof be affixed thereto and cancelled by the bank.
6.	That a request in writing by a customer of a bank asking the bank to transfer from the account of the customer to another bank a sum certain for deposit only to the credit of the customer in such other bank, and an advice in writing by a bank to its customer that a sum certain is placed to the credit of the customer for transfer and deposit only to the customer's credit in another bank, shall not be subject to the stamp tax prescribed by section twelve of the said act.
7.	That in the case of the first complaint to the minister or any officer of Customs and Excise against a person for failure to properly stamp a receipt given by such person the minister may permit the person to affix the stamp in the manner prescribed in section fourteen of the said act within one month of the date of the permit on payment of a penalty of ten dollars.
8.	That subsection four of section nineteen BBB of the said act as amended by section three of chapter sixty-eight of the statutes of 1924, being the list of excepted articles not liable to the consumption or sales tax, be amended by striking out of said section three of chapter sixty-eight the words "gasoline engines to be used in boats bona fide used by individual fishermen for their own personal use in the fisheries" where they occur in lines twenty, twenty-one and twenty-two, thirty-eight, thirty-nine and forty, and fifty-eight, fifty-nine and sixty of said section three; and that the said subsection four of section nineteen BBB be further amended by adding thereto the following:
"Vegetable plants; lasts for boots and shoes including rubber footwear and patterns for boots and shoes including rubber footwear; goods enumerated in customs tariff items 453e, 469a; articles and materials to be used exclusively in the manufacture of goods enumerated in customs tariff items 453e,

Special War Revenue Act
469a; materials, not to include plant equipment, consumed in process of manufacture or production which enter directly into the cost of goods enumerated in customs tariff items 453e, 469a."
9.	That the bond required under the provisions of subsection seven of section nineteen BBB of the said act to be given by a licensed wholesaler or jobber shall be for an amount not more than fifteen thousand dollars and not less than two thousand dollars.
10.	That any enactment founded on paragraph eight of this resolution shall be deemed to have come into force on the twenty-fifth day of March, 1925, and to have applied to all goods imported or taken out of warehouse for consumption on and after that day and to have applied to goods previously imported for which no entry for consumption was made before that day.
11.	That any enactment founded on this resolution, excepting paragraph eight thereof, shall come into force on the first day of July, 1925.
On resolution 1:


Henry Herbert Stevens: What is the effect of
resolution number one?


James Alexander Robb: These resolutions are based on the act introduced in 1915, The Special War Revenue Act. It has been brought to the attention of the department that there has been an evasion of the intent of the act and the amendment is to define more clearly what a cheque is so that there shall be equity all along the line. After we have got through with this I shall move an amendment to provide that the stamp tax imposed by The Special War Revenue Act of 1915 on any cheque receipt for money paid by a bank, money order, traveller's cheque, post office money order and postal note, shall not be payable in respect of any of the said instruments if it is for an amount not exceeding $5. That I think will be some concession to all classes throughout the country.


Milton Neil Campbell: Could the minister not
raise that to $10? We have a great many protests from dairymen and produce dealers in the west, and personally I have so many resolutions here that it would be impossible to read them all to the House. They come from various representative bodies, such as boards of trade, dairymen's associations, creamery companies, wheat pool organizations, grain growers' associations, farmers' unions and agricultural societies, and it is pointed out that the cheques or bills for produce such as eggs, cream and various other commodities, are for very small amounts, very often for $2 and $3. When we remember that the stamp of 2 cents for every $50 applies only to cheques up to $2,500, it will be seen that this provision is a direct bonus to those who are handling large amounts. This is a particular hardship on the dairymen and the various produce dealers of the west, because
naturally it all comes out of the producer in the end. I think the minister might raise this amount to $10.


James Alexander Robb: If my hon. friends were responsible for raising the revenue to meet the fixed charges of the country and our interest on the immense national debt we incurred during the war, as well as to take care of pensions to the soldiers and the widows and children of soldiers, besides carrying on the general affairs of the country and providing for the development of our transportation system, building branch line railways and all that sort of thing; and if, in addition to that, they were attacked by the same people in the country, the delegations that come to interview the government, some wanting public works and others seeking to evade taxation -if hon. gentlemen were faced with such a problem as this they would see how difficult it is to carry on our national business. If we fix a limit of $10 it will simply mean that the revenue of the country will be seriously eaten into. This I think is a very fair concession. My hon. friend a moment ago referred to the dairy business. I want to say frankly that the government never contemplated that or any other business in particular in framing this legislation.


Arthur Meighen: Could not the hon. member escape the tax by issuing two cheques?


Milton Neil Campbell: That occurred to my
mind, but I prefer to do it in the proper
way.


James Alexander Robb: When Sir Thomas White
brought in the legislation originally it was thought that it would cover all forms of payments in the way of cheques; but there are men in business who sit up at night trying to devise ways and means of evading taxation, and it has been found in practice that there is considerable business in the country that has escaped. The farmer who sells his grain is not the man who pays the tax on the $2,500; it is the man who purchases that pays it.


Milton Neil Campbell: When the farmer ships a car of grain he finds a deduction on his bill for the exact amount of the stamps used on the cheque.


James Alexander Robb: He will not find that in the
case of regular grain companies.


Some hon. MEMBERS:: Yes.


James Alexander Robb: Then he has recourse under
the law, because the law says that the man who issues the cheque must put the stamp on.
Special War Revenue Act


Milton Neil Campbell: And so he does; the
man who issues the cheque puts 'the stamp on and deducts it from the bill.


James Alexander Robb: He has no right to do so.


Mr. BROWN:: The minister will remember that two years ago the Minister of Finance (Mr. Fielding) made the statement that the government did not care who paid the tax so long as it was paid.


James Alexander Robb: But I am pointing out the law as it is. My hon. friend introduced the question of the dairy industry in relation to milk cheques. I am told that in western Canada there is a system of doing business whereby they are paid daily as the produce is sent in. I have been listening to and reading the debates that have taken place and I notice that some hon. gentlemen have particularly emphasized the fact that a direct tax is the proper sort of tax to be imposed. Now, this is a direct tax. They emphasize this also, which is the fact, that any tax should be equitable. Let us take that part of the dairying industry which sends its product to the dairy factories. In the three western provinces the business last year was about twelve million dollars; in eastern Canada it was eighty-two million dollars. Now, the people who were doing the eighty-two million dollars' worth of business paid the tax on the cheques they sent to their patrons; the other people did not pay it. I ask hon. gentlemen, is that an equitable tax all over Canada? All we are trying to do is to make this tax not merely applicable to the dairy business but to every business-in a word, to make it equitable all over the Dominion. We have discovered that not only in the dairy and grain business, but also in the lumber business and the machinery business methods have been devised of evading the tax, so we are tightening it up now in order that everyone liable will have to pay. As my hon. friend said a moment ago, most of this business is for amounts under five dollars, and the amendment which I propose will release cheques up to that amount; but we want to make it equitable, therefore we are releasing payment of stamps on these small cheques to everyone throughout Canada.


Milton Neil Campbell: I have a good deal of sympathy with the minister, and agree with the most of what he has said. Undoubtedly we must have revenue. But I do not agree with him when he describes this as equitable. The inequity is the very thing we are protesting against; we say that it is not equitable. Let me take a concrete case. A cheque for $20,000 would bear a fifty-cent stamp, but ten 
cheques of five dollars each would bear a tax of twenty cents. It is the very inequity of this that we are protesting against. I think the minister could straighten it out a little better if he would raise the $2,500 minimum to $25,000, or something like 'that, and then I think there would be little complaint from the men who pay on the small cheques.


Arthur John Lewis: Mr. Chairman. I am pleased that the Acting Minister of Finance has acquiesced in the judgment expressed by the western members Ito even t'he extent of five dollars in the interests of the primary producers. This :t*x would have been a serious matter to many of our farmers in the west who to a large extent depend for their living on dairy products, and I am sure they will be glad that the extra burden has been so justly removed. Buit I also agree with my colleague from Mackenzie (Mr. Campbell!) that the minister should go a step further and raise the minimum to $10, which I am sure would earn him the gratitude of the western .producers.


James Alexander Robb: But we would lose a Hot of revenue, and 'this we cannot afford to lose, for we have to provide for interest on the national debt, for pensions, and1 for carrying on the affairs of the country. If I open the door and raise the minimum ito $10 for the dairy men, I have to open dt for all others. I submit that the country cannot afford to lose the revenue.


Milton Neil Campbell: Leave the minimum just as it is at $5, bult raise the maximum to $25,000, then you will iget some revenue.


Edward Joseph Garland: Get some revenue from the larger cheques; don't lose them.


James Alexander Robb: That change was made not with the view of relieving anybody, but to secure additional revenue. We found that a lot of business along the international boundary line which should have been done 'through Canadian banks was, on account of this higher tax, going to the United States banks across the border. It was (to bring that business back that we made 'the maximum $2,500.
M.r. BOYS: The minister says that raising the minimum to $10 would involve a very considerable loss of revenue. Unless he can show us that such a loss wiould ensue, I would be inclined to support the suggestion to increase the minimum to $10, for it is most annoying to have to put a two-cent stamp on small receipts and cheques. Personally I do not think there would be any serious loss. To-day these small amounts are very often paid in cash; I think iit is desirable to encourage people to pay by cheque, and so avoid the

Special War Revenue Act
many disputes that arise where receipts are not given on cash payments. I think in, the interest of people doing business in a small way the minimum should be increased from $5 to $10 unless the minister can show the House that the loss in consequence would be very substantial.


James Alexander Robb: I regret I have not the exact
figures before me, but it is estimated in the department that the change would involve a very considerable loss of revenue. I agree with my hon. friends opposite that these stamp taxes are a nuisance, and it would be much better if we could meet the views of * hon gentlemen and raise the limit to $10. But I would suggest that we try this minimum of $5, and if next year we find we can increase it to $10, $15 or $25, we will be glad to consider it.


Mr. BOYS:: Is any effort made to ascertain
the amount paid, for instance, on cheques of $5 and under, on cheques from $5 to $10, and on cheques from $10 to $15, or is it merely the total which is derived from the tax?


James Alexander Robb: It is the total. I did ask
some of the banks to try and get me an estimate along that line, but the time was too short for them to give me any.


Arthur Meighen: What is the total income from the tax stamps on cheques and receipts?


James Alexander Robb: About ten million dollars
from all stamps.


Arthur Meighen: Ten million do'lars on all stamps! Does that include cheques, receipts, overdrafts, bills of exchange, notes, and all those things?


James Alexander Robb: Yes, about ten million dollars.


Arthur Meighen: I am astonished if it is
that much.


James Alexander Robb: I am speaking in round
figures. I will try to get the exact figures.


Arthur Meighen: I take it that all of
them are objectionable, as every tax is.


James Alexander Robb: I agree.


Arthur Meighen: Cheque and receipt
stamps are by no means as objectionable as the overdraft and note taxes. Those are taxes that affect me most.


James Alexander Robb: And me too.


Arthur Meighen: And I feel most keenly
about them. I have never under any government been able to understand why a man ought to pay a tax because he owes a debt -the more he owes and the harder up he is, 200
the more he is taxed. That is the actual law. I am not objecting to the cheque tax and the receipt tax, these are in
9 pm. a different category, but the overdraft tax and the tax on a note that a man cannot pay really strike me as the most inequitable, unjust and iniquitous. Of all taxes in the world I think those are the hardest to defend. Surely there can be something devised a little more sensible than those. It is really an attempt to tax poverty.


James Alexander Robb: I agree with very much that
my right hon. friend has said, but I would remind him that this tax was introduced originally in 1915.


Arthur Meighen: I know that.


James Alexander Robb: By a former colleague of my right hon. friend. It is based on the English act. Under that act I am told that the tax on an overdraft in the United Kingdom is slightly higher than it is in Canada.


Arthur Meighen: This government increased it.


James Alexander Robb: Yes, we did. The British act has been in force since 1845. In 1894 it was contended that coupons should also be taxed, and the British government amended their act to make it clear it was not intended to tax coupons, and coupons are not taxable in Canada. Now why is that? Coupon bonds are not issued by a business concern. No business concern can tell what they are going to be able to pay in five, ten, fifteen or twenty years; they do not finance that way. Coupon bonds are generally issued by governments, dominion, provincial and municipal.


Arthur Meighen: The minister is wrong.


James Alexander Robb: Not to any great extent. Now if we imposed a tax on coupon bonds, and a tax had to be put on every coupon, that tax would have to be put on at the time the document was issued. It might be payable fifty years from now; it might be a fifty-year bond, and before the fifty years had expired the country might have repealed that act. That is one reason. The other is that it would be an additional cost on the municipality or corporation issuing the bond. They would have to put the tax on at once, and therefore, very wisely I think, coupons have been exempt from taxation.


Arthur Meighen: It may be wise to exempt-coupons, but I do not think the minister's reasons are conclusive. In the first place, although it does not seem to be relevant, coupon bonds are issued by corporations in many cases.

Special War Revenue Act


James Alexander Robb: I have never seen them.


Arthur Meighen: I have; but the minister's objection would not apply, because there should be no difficulty in the execution of a law which provided, not that the coupons should be stamped, for that would be impossible without providing for their stamping on issue, but which provided that before being cashed the stamp tax should be put on the coupon. I cannot see any objection to that. If the law was repealed afterwards, there would be no stamp tax to put on the coupon.
Why also would it not be much more sensible to tax deposit money than to tax over-drafts?


James Alexander Robb: That view has been represented to us.


Arthur Meighen: Deposit money is not in circulation, it is not helping the country, it is simply held there without doing very much for the public at all, and also they represent at least a certain amount of money, and the larger they are the more they should be taxed. But to tax the fellow because he cannot pay a debt, and to penalize him every three months, simply means that when you get a man down you are going to push him further down-down, down he goes, with the government's heel on his neck all the time. For the life of me I cannot See any common sense in that overdraft tax at all.


John Livingstone Brown: I would like to endorse what the leader of the opposition has said with regard to this overdraft tax. I have had some little experience with that in trying to finance for a small country elevator, and we felt it to be a heavy burden to have to pay an overdraft tax at very short intervals.
In regard to the stamp taxes, the hon. member for North Waterloo (Mr. Euler) spoke of these as nuisance taxes some time ago. I do not altogether agree with him. I do not think this stamp tax should be any particular nuisance to the man in business, for he is prepared to stamp all the documents that come before him, but this particular tax will be a nuisance to a large class of people who are not in the way of doing business. These creamery tickets, as we call them, are given to large numbers of people who have no banking account, who never see a cheque, who never have had anything to do with issuing cheques or stamped documents in any form, and this tax will become decidedly a nuisance tax to them. I can imagine the consternation if will create in the minds of a great many people who are shipping an odd can of cream to the creamery and getting back what we call cream tickets for four, five, 
or it may be six or seven dollars in some cases. It will put a very heavy burden on them which I think they might very well be relieved of, and it will most certainly become a distinct nuisance tax to this class of people who have had nothing to do up to the present with the stamping of any document.


Mr. EULER:: I would like to say that I
have a good deal of sympathy with the views expressed on the other side of the House with regard to the stamp taxes. I would support anything that will tend to minimize the effect of these nuisance taxes. I do not know to just what extent the remedy the minister suggests, or the further one suggested by my hon. friends opposite, will tend to relieve the situation, but I would urge upon the minister to do everything he possibly can to relieve the public of these nuisance taxes. I do not altogether agree with the hon. gentleman who has just spoken (Mr. Brown). It may be true that this will be a nuisance tax more particularly to the people of whom he speaks, but I bdlieve they are nuisance taxes to everybody.
The hon. leader of the opposition has referred to the tax on overdrafts, and the illogical nature of that tax. I think his remarks apply just as well to the tax on cheques, because the tax is taken from the man who pays. It ought to be taken from the man who receives, if it were possible to do so. I think it is just as illogical in the one case as in the other.
So far as the receipt tax is concerned, the law is more honoured in the breach than in the observance. I do not believe out of ten receipts upon which the tax should legally be paid, it is paid on one. Most people evade it. Generally the man who receives the receipt will make no objection if the stamp is not on the receipt. As a matter of fact, I think it is an encouragement to the breaking of the law in that respect.


Robert Alexander Hoey: The receipt is of no value unless it is stamped.


William Daum Euler: It certainly is evidence to show the money has been paid, and I venture to say and I think I know whereof I speak, that in the majority of cases where the receipt is for more than ten dollars the stamp is not affixed at all.
I was rather surprised at the amount given by the minister of $10,000,000 as being the amount of revenue collected under these taxes. I was just wondering whether it would be possible absolutely to segregate these taxes and ascertain just what the revenue is from that source. Ten million dollars seems very high indeed.

Special War Revenue Act
I would like to urge again that the government, if it is at all possible, get rid as soon as possible of this form of taxation, which is about as annoying as anything that could be devised.


Mr. CHAPLIN:: I would like to inquire from the minister if it is the intention to do anything in respect to the receipt tax. My reason for asking this is that I believe there is a studied endeavour on the part of people to avoid paying this tax. I would call the minister's attention to one case that came to my notice. I received what I call a receipt after sending a cheque, and on the receipt was written, "Your cheque received. No receipt is necessary." It was signed, and there was no stamp affixed. I would like to ask the minister if that is a legal document, and whether something cannot be done to avoid that sort of thing being done?


James Alexander Robb: My hon. friend who is a
business man, and a good business man, knows that if he issues a cheque payable to order, and the payee endorses the cheque, he can have no better receipt than that. That covers it, as I am sure my hon. friend will admit.
Regarding the observations of my hon. friend from Lincoln (Mr. Chaplin) and the hon. member for North Waterloo (Mr. Euler) that the receipt tax is being evaded, I venture to say that to-morrow the officers may look into conditions in the constituencies represented by these hon. gentlemen, because I have in mind that within the last three months a Roman Catholic priest wrote to me and wanted me to see my colleague the Minister of Customs, who is a member of his own church and his own race, because he had taken action against him for not having put stamps on the receipts for pew rent. I say this in all justice to my colleague (Mr. Bureau) who is absent that wherever it is brought to his attention that people are evading the tax he does his best to have it collected. That is what the tax is imposed for. That tax has been in force in Great Britain for many years. The receipt tax is a good tax, and we get a lot of revenue from it, for instance in hotels from tourists and transients who are passing through the country.
Now with regard to the tax on the $10,000,000 officers have gone after it and I think we will get that collected. I recall since the debate started having a conversation with a representative of the Bankers' Association, and he gave me the assurance that the most of this overdraft tax, that' is the one I am talking about now, is paid by big business- stock brokers who deposit securities in the 200i
bank and get an overdraft covering them. From that source there is about $8,000,000 of revenue derived. If hon. gentlemen wish to lose $8,000,000 for the sake of a few of us-and I am in the same class as my hon. friend-


Arthur Meighen: Eight millions?


James Alexander Robb: Yes, that is the amount of revenue derived from "big business".


James Dew Chaplin: The minister, it seems to me, has missed the point I was trying to get at. I never questioned the value of the receipt that was on the back of my cheque; but when a man sends me a receipt for it I expect it to be stamped. I may say to the minister that he does not need to come to my constituency; there is a case in point that I can produce to him very close to his own constituency.


James Alexander Robb: All right, let me have the facts and we will get after them.


Oliver Robert Gould: I wish to add my little word of protest to the protest of other hon. gentlemen who have expressed themselves concerning the $10 cheque. I think I am in receipt of possibly, one hundred letters and telegrams from the western country protesting against this proposed tax. I believe that if the minister would make a recommendation that $10 should be the minimum he would not necessarily lose any revenue. I am aware that in the past in the case of grain cheques this tax has been evaded in many instances. I could cite instances where one would sell his grain upon the street, receive his ticket from the weighmaster, and then go to the bank and cash it without any question being asked-he got the full amount written upon the ticket. In other places when he presented his ticket at the bank they would insist upon the stamp being placed upon it. I think if such a regulation were enforced the minister would secure as much revenue as he would by requiring the payment of a tax upon a cheque for $5 or for something over that amount.
I also know that what the hon. member for North Waterloo (Mr. Euler) has said in regard to receipts is true; but of course in that case there is no method whereby the stamp could be cancelled, and therefore the question of legality would not necessarily arise. If the receipt were questioned there would be no difficulty in the individual putting a revenue stamp on the receipt and thereby, possibly, rendering it legal. In the case of bank cheques however it is a different matter; there is no opportunity to avoid the
Special War Revenue Act

liability as there is in the ease of receipts. The minister said that in reading over a number of the budget speeches he noticed that arguments were made for direct taxation. I am one of those guilty individuals; I have always advocated the principle of direct taxation.


James Alexander Robb: For the other fellow.
Mr. G/OULD: The minister has only told one half of the story. We have been advocating the principle of direct taxation for many years, but we do not want that supplemented by indirect taxation. The minister has brought down a budget which adopts the principle of indirect taxation, and now he wants to apply the principle of direct taxation too. That is what we are objecting to. We are prepared to pay in our equity on the principle of direct taxation, provided it supplants indirect taxation. That is the important point with those who are in favour of the principle of direct taxation.


Henry Elvins Spencer: Why was it found necessary to substitute excise stamps for postage stamps when putting stamps on cheques? There were many postmasters in the rural districts who got a small commission on the postage stamps they sold, and they regard it as a hardship to substitute excise stamps for postage stamps.


James Alexander Robb: I know that it occasions considerable inconvenience and some heart burning perhaps, but hon. gentlemen must understand that if we are to determine what revenue we are receiving from the Post Office Department the business must be segregated. That was the object in view in making the change.


William Daum Euler: Are the stamps now used
on commercial paper, cheques, and so forth used only for that purpose, and was the change made in order to tell exactly what the revenue was?


James Alexander Robb: Yes.


Donald Ferdinand Kellner: How would the minister
prevent a debtor who owed $25, using five consecutive cheques in paying his creditor, and' evading the law in that way?


James Alexander Robb: Do not ask me to tell people
how to evade the tax. They know pretty well already.


Donald Ferdinand Kellner: I was assuming that
people knew how and asking the minister how he would overcome the evasion of the law if that practice was resorted to.


Milton Neil Campbell: The minister mentioned a reason for exempting cheques above $2,500

that I think is very well ill-founded. I can hardly conceive of a business man, or a business corporation, carrying money across the line, depositing it in an American bank, and then issuing a cheque on it to some part of Canada in order to evade the tax. That is something I can hardly conceive of; in fact we have heard so much about the weakness of American banks that I cannot imagine any of our larger corporations using those banks at all. I do not think there is very much force in that argument. But let us take the case of the man who writes cheques for $5 and a little over, amounting in all to $50, he has to pay a tax of twenty cents.


James Alexander Robb: Wait a moment. Does my hon. friend say he has to pay twenty cents?


Milton Neil Campbell: Yes, twenty cents.


James Alexander Robb: On a cheque for $5.


Milton Neil Campbell: We will say there are ten cheques and in each case it amounts to a few cents over the $5. He is penalized to the extent of 18 cents.


James Alexander Robb: He pays two cents on $50.


Milton Neil Campbell: He pays two cents on one cheque of $50 but if he issues ten cheques for $5, or five cheques for five dollars and one cent he pays twenty cents. So that he is penalized to that extent on a total amount of $50. On the other hand a man issuing a $20,000 cheque pays 50 cents. That is, he pays $2.70 less than he would pay if the tax were equitably assessed. Now that is my complaint. I can hardly conceive a man issuing a $20,000 cheque and then walking, perhaps a considerable distance to the American side of the line depositing his money there, and issuing a cheque against it just to save $2.70. In my opinion that is a very weak argument. I may say personally, and I think it would apply to most hon. gentlemen in this section of the House, that we are quite satisfied with the amendment the minister brings in providing he will raise this amount to, we will say, $20,000. This will make a considerable increase in his revenue. We certainly do object to the present lack of equity in the assessing of this tax.


Mr. McQUARRIE:: With reference to the tax on receipts, I understand the minister has received representations in reference to putting stamps on monthly statements. I believe that early in the session a ruling was given that monthly statements that showed credits of more than $10 would not require to have stamps on them, but very recently

Special War Revenue Act
a contrary ruling has been given, and now further representations are being made to the minister in connection therewith. It would seem that the requirement of stamps on monthly statements is rather stretching this stamp policy. I was wondering whether the government had determined what the department would do in that connection.


James Alexander Robb: The stamp on monthly statements was only brought to my attention when I returned1 to Ottawa on Monday of this week. I never heard of it before and I cannot understand that it is general, because I know two businesses, not large businesses but businesses of some size, in connection with which statements were sent out each month.
I never heard of the stamp being required, and I think I would have heard if the department had insisted upon it. If the department has made such an order, I agree with my hon. friend, and I do not think the act ever intended that. However, if the monthly statement is receipted, or a payment is acknowledged in the statement, and it is sent back, this stamp tax would be imposed, but I cannot believe that it would be imposed simply on the statement being sent out.


William Garland McQuarrie: I got a communication from the Credit Men's Association in Vancouver, in which they said they had only recently been notified by the Vancouver branch of the department that a stamp would have to be put on a monthly statement, but I accept the minister's explanation.


James Alexander Robb: I will direct the attention of
the Acting Minister of Customs and1 Excise to this matter. I was a bit surprised to hear of that tax.


Harry Leader: In common with hon.
members, I agree that paying taxes is rather a nuisance, and I agree with the minister that so long as we spend the money we must pay the bill. I understood the minister to say that grain dealers would put the stamp on the cheques they issued to the farmers and bear the expense themselves. Is that the minister's information?


James Alexander Robb: That the dealer pays it?


Harry Leader: Yes.


James Alexander Robb: Yes, the person who issues
the cheque must put the stamp on it. That is the law.


Harry Leader: I am very glad to hear the minister's declaration.


James Alexander Robb: Before my hon. friend proceeds. let me tell him that a cheque is no
good and will not be accepted by the bank unless the stamp is on it.	[DOT]


Harry Leader: I could relate a little
experience which would go to show that the farmer is charged with the amount of the stamp tax.


James Alexander Robb: Well, that is wrong.


Harry Leader: When the act came into
force, in settlement for my wheat they sent the cheques to me by mail, deducting the amount of the stamp tax which I think was about forty cents per car. I had to pay that money. I immediately wrote to the grain dealer and told him I felt like bringing an action. He is a very good friend of mine and he wrote back that notwithstanding my threat-although he did not use that word-he felt they were entitled by law to charge the stamp tax to farmers. I wrote to the Finance Minister, at that time Mr. Fielding, and he wrote back that he had referred the matter to the Department of Trade and Commerce.


James Alexander Robb: No, it would be the Department of Customs and Excise.


Harry Leader: Perhaps it was. In due
course I received a letter from the Department of Customs and Excise saying they had referred the matter to the law officers of the crown. After some little time I received a letter from the law officers of the crown saying that in their opinion the man issuing the cheque should pay the stamp tax but added that in my case it was a matter between me and the grain dealers to settle. I took it to a lawyer in Portage la Prairie and asked him what he thought about it. I showed him all the letters and he said, "I believe we can beat them if you have money enough, but I would advise you to drop it, because you would be the loser if you did win." And I dropped it. The law officers of the crown declared that in their opinion there was nothing I could do, and to-night the Acting Minister of Finance (Mr. Robb) says that certainly the grain dealer should pay the stamp tax. I should like to see the law enforced immediately and made retroactive.


John Livingstone Brown: The question has arisen, as my hon. friend from Portage la Prairie will admit, on account of the way in which grain is sold in the west, namely through a commission house. There can be no question that the man who issues a cheque for grain or anything else must stamp it. He is the actual purchaser of the grain, but the difficulty with the farmers in the west has arisen from the fact that the grain is handled through the commission men; the commission men have re-
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fused to pay the tax, and have charged it back to the farmers, because they claim, whether rightly or wrongly, that they are not the actual purchasers of the grain. It is that situation which has led to all the difficulty.


Oliver Robert Gould: I am sure it is not the intention of the minister to enact legislation through which a coach and four can be driven.


James Alexander Robb: Not if I can help it.


Oliver Robert Gould: I am sure he realizes that, with the exemption of the five-dollar cheque, ten dollars can be paid with two cheques. I would ask that an exemption be made of cream tickets, and I will give the reason. In our western country in the summer time feed is much cheaper, and cream is also cheaper, and usually in the case of a five-gallon can less than five dollars will pay for the cream; but m the winter time, when people are trying to bring in a little revenue, often it costs as much as ten dollars to produce a can of cream; therefore it is a complete loss of the tax on anything less than ten dollars. I think the minister can secure a revenue by a strict enforcement of the tax on the wheat ticket or the grain ticket. I would like to ask what penalty is provided in case the individual issuing a wheat or grain ticket refuses to comply with the law.


James Alexander Robb: I have not the act before me, but I am told there is a penalty and the officer tells me he thinks it is $100. I hope hon. gentlemen will not press for the ten-dollar provision; let us try the five-dollar proposition and find out for ourselves how much revenue we can afford to lose next year. I think that is a fair concession.


Milton Neil Campbell: I am pleading with the minister to raise the revenue of the country and will he not consent to raise the minimum from $2,500 to $5,000 or $10,000?


James Alexander Robb: There was no limit on it at one time, but experience proved we were losing money and we dropped it in order to get more revenue.


Milton Neil Campbell: Is the minister in a position to prove that they lost revenue? I can quite conceive of big companies going to the minister and telling him about the treasury losing money; but I cannot conceive of these same companies going across the line to deposit their money. I think if the minister wants the money there is an opportunity there to get it.


Edmond Baird Ryckman: In reference to this question of going across the line to deposit money, that is not necessary at all. Banking by mail

was the usual practice of large bouses. There was not a large concern within my knowledge that did not have a bank account in the city of New York. If you are making two dollars on every five thousand in an account, it will pay you abundantly to keep your accounts in the United States. There is no use arguing the question; every business man knows there was money lost to the country by the imposition of this tax on large amounts. It would seem to me that anyone who is able to buy five gallons of cream-and that is what a can contains-would be able to pay this tax.


Milton Neil Campbell: If a cheque is issued on a Canadian bank and if that is sent by mail to be deposited in a bank in New York, do they ndt change a, llittlle heavier exchange than the regular exchange and that will ealt up any saving effected in issuing a cheque on a New York bank?


Edmond Baird Ryckman: It paid to keep a
banking account in the city of New York, and my hon. friend must know ifhalt onlce you have the .money in New York, you pay nothing for chequing it out. You can cheque it out in any amount. At one time-and I am glad to say that that time is past-New York funds were at a premium. Consequently, if you gave a New York cheque you were at a great advantage and you did not have this tax to pay. The people of Canada, in hordes were running away from banking in our sound, home banking institutions. Another factor in the matter was ithis. We in Canada had millions on deposit in the United States and we were without the benefit of that money in Canada. The whole 'thing was so absurd, such a disadvantage to the country, that it was soon cured- even- by this government.
With respect to the desperate fight that my hon. friends to my left are putting u|p to escape a two cent tax -on five gallons of cream, it would seam to me that the .man or the dealer who was able* to buy this cream could quite well afford it-o put the stamp upon these cream tickets, as my hon. friends call them. The tax does not come out of the farmers.


Some hon. MEMBERS:: It does.


Edmond Baird Ryckman: No. The man who buys the cretam is the o,ne who, under the law, is required to put the stamp on.


Mr. STEWART (Humboldt):: But the
cream is handled co-operatively.


Edmond Baird Ryckman: 
Some hon. MEMBERS:: Why?


Edmond Baird Ryckman: It is only a very little in sales tax. Some hon. members ask "why" in regard to the income tax. The smallest fraction, under one per cent of the income tax of this country, I understand, is paid by the farmers.


Some hon. MEMBERS:: Why?


Edmond Baird Ryckman: How are they going to be reached? "Why", they say. Because there is a special income tax regulation covering them.


Some hon. MEMBERS:: No.


Edmond Baird Ryckman: There is. The ordinary clerk in a manufacturing establishment anywhere throughout Ontario has to pay upon everything that he buys. It is well known that the clerk in the office of the manufacturing establishment or in the shop pays more in taxes than the ordinary farmer does. I am not pleased by any means at the opportunity of getting even, because we can never do that; but one hon. member to-night inveighed against the city from which I come because it was found that some taxation was oppressive. I might tell him that 23 per cent
of all the taxes that are paid in this Dominion are paid in and through the city of Toronto.
I think the situation of the farmer is not as bad as it might be. It is better and getting better and, therefore, we might expect that on a matter of five gallons of cream they might be willing to pay or to have the dealer who buys from them pay the two cent tax.


Edward Joseph Garland: Did the hon. gentleman state that 23 per cent of the taxes of the Dominion were paid by the city of Toronto or the residents of that city?


Edmond Baird Ryckman: About 23 per cent of the revenue collected by this Dominion, is paid in and through the city of Toronto.


Edward Joseph Garland: That is
different.


Mr. McBRIDE:: The hon. member for East Toronto (Mr. Ryckman) has referred to the people in this section of the House as paying no taxe3. He seems to think that the Progressives do not pay any taxes, and he refers to the people of Toronto as the ones who pay the taxes. I am a farmer, and I might say that I paid last year over $12,000 in taxes.


Mr. WARNER:: I did not intend to speak for very long, but things are in such a shape that I shall have to take longer than I expected to do. It is late and I do not want to detain the committee longer than is necessary, but I should like the committee to understand the situation before it takes action in regard to this matter. I have a certain amount of pity for my hon. friend to my right (Mr. Ryckman), who has been pointing out how the farmer is escaping taxation. I intend to show, before I finish my remarks, that the farmer is not escaping taxation by any means and that he is paying under this arrangement more than his share. I believe also he does in a good many other ways. I will, however, pardon the hon. gentleman on account of ignorance on his part.


Edmond Baird Ryckman: Tell us how you pay.


Daniel Webster Warner: I have not time to quibble over these matters. I want to show the unfairness of my hon. friend's statements. Several hon. members have discussed the exemptions already made. I should like to say something about that, but I do not feel like spending any time on it. because everyone knows that every fifty dollars that is issued in a cheque ought to pay its own share, whether it does or not. That is, every fifty dollar cheque should have a two cent stamp, and if the cheque is for a greater amount than fifty
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dollars, a two cent stamp should be put on it for every fifty dollars or fraction thereof over and above the first fifty dollars in order to have a fair taxation. That is not being done, but I will not discuss that particular phase of the question. I desire to discuss particularly the creamery phase of this matter. I am a director in one company that pays most of its accounts in small bills, and this concern is doing more than any other in the country, taking into account the amount of capital involved, towards helping to make Canada prosperous.


Robert King Anderson: Is it a farming institution?


Daniel Webster Warner: It is connected with
agriculture. Last year we had a turnover of over S3,500,000 and most of it comprised small accounts. We do not make many cheques of S50, and the few we handle of this denomination are used in connection with supplies. But in buying cream we do not make one of S50. I have here two different statements to which I shall refer. The other night I made a statement regarding this matter in the course of which I submitted several quotations, and to-night I want to put on Hansard the views of two different creamery managers one of whom is the secretary of the Dairymen's Association in Alberta with regard to the payment of this tax. We must remember that this is part of overhead; you cannot get away from that and you need not think it possible. The producer will pay it in the end simply because the world's market fixes the price obtained for the butter that is made in these creameries. The creameries cannot decide that the price shall be a little more and in that way make the consumer pay his share of the tax; it will come back finally to the man who is producing. In this connection I would point out that we have instituted the system now practised as a means of securing a better quality of butter and thereby giving a better return to the producer. That is what it was done for; it was not done in contravention of the law. I read to the House and put on Hansard the other day a statement from the secretary of the National Dairy Council pointing out that the dairy cheque had been interpreted by the Department of Customs and Excise as a receipt. It is not a cheque, and in following this interpretation they are acting on the advice of the department. They issue these receipts for milk and cream, and they are not doing it to get away from the law in any sense. I do not want to labour this matter, but I do want to impress on the committee the fact that the system which is now in operation, and which is the result of care-

ful study over a number of years, is designed to produce the highest quality of butter from our cream. The cream has to be delivered in small lots and it requires almost daily deliveries to get it in such condition as would turn out the sort of butter that the markets of the world demand and which brings the highest price.
As to passing on this tax, I do not think that it will ibe doubted for a moment that it forms part of the overhead. On this point let me read what one creamery man says in Saskatchewan. Mr. J. A. C'alder, president of the Saskatchewan creamery, writes to the editor of the Western Producer as follows:
Editor, The Western Producer:
Dear Sir,-I noticed a reference in your last issue to the new ruling proposed in the budget speech whereby grain tickets will in the future be subject to the revenue stamp tax. This is not so serious a matter, however, as the fact that it is proposed that cream tickets and produce tickets shall also be taxable. Tickets issued for grain are usually large tickets and it only means two cents on each $50.-
There are hardly any grain tickets for less than $50 and none for amounts less than $10. These therefore are out of the question altogether. Next come the creamery and produce tickets. I do not know how much produce would be handled by this method but the dairy cream receipts are the documents particularly referred to in this connection. He goes on to say:
-but last year our company alone bought 200,000 cans of cream with an average value of slightly under $5 per can-


James Alexander Robb: They are being relieved right
now in that respect; they are no worse off than they were last year.


Daniel Webster Warner: I note that, and I thank
the minister for what he has done. But I want to point out where he might do a little better.
-and if each one of these cream tickets had to bear two cent revenue stamps it would have meant $4,000 on last year's business-


James Alexander Robb: But they will not have to
bear the tax under the proposed arrangement.


Daniel Webster Warner: I will give my view of
the matter later on, if you please. I understand quite well that the amount now fixed is $5. This writer continues:
-and on a basis of the 1925 production it will cost the dairy farmers of the four western provinces at least $100,000, and this figure will possibly double every three years.
As you know the system in use in this country is to pay for each can of cream individually by a separate remittance. We must pay three cents postage on the letter and we must pay the bank five cents for cashing the ticket and then there is the stationery used, so that it now costs us ten cents to remit for

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every can of cream, and the new proposal would mean twelve cents. This is a matter which very seriously affects the producers of cream in western Canada because we think it is a generally accepted theory that the producer or the consumer must absorb all such extra expenses.
That is what this manager says; he declares that they cannot absorb the expense, I hope the committee will pardon me if I read what another manager, also the secretary of the Alberta Dairymen's Association, says. In reply to a letter I wrote him he writes:
Replying to your letter of the 6th instant, the manufacturers certainly cannot stand the expense of the stamp on	the	coupons	and, therefore, if the government does	not	rescind	this tax	on coupons less
than $10, the cost will have to be passed on the producer and consumer and in this case no doubt the producer will have to bear the lion's share of the cost.
As for a substitute system-there is no system quite so good as the coupon. However, if the government does not rescind this tax, we will probably call the coupon a cheque and place deposits in the banks at which the coupons are issued. In this way, we will only be out	the	expense	of a 2c	stamp. However,there are all	the	banks outside of	the points where
coupons are issued, and it is a big job to arrange to keep cash in all of these banks.
As regards payment twice a month-I believe over 75 per cent of the farmers of this country would raise a howl that we would all hear about, if we were to go on a twice a month payment system. As you know, the farmers are hard-up and require cream money to pay current expenses.
And I know for a fact that they are.


Robert King Anderson: Who are the shareholders of that company?


Daniel Webster Warner: They are men who were
not afraid to risk their money in a business that would make the country prosperous.


Robert King Anderson: What business are they engaged in?


Daniel Webster Warner: They are mostly farmers. This concern was started to create a market for our milk and cream, manufacturing it into butter-just what the hon. gentleman and all others want done in this country: they are turning out the finished article instead of letting our raw material go out of the farmers' hands at a sacrifice. They had to have their own creamery there in order to produce the finished article.
Passing this tax on to the farmer may seem a small matter to some hon. gentlemen. True, it does not amount to much on one five-gallon can of cream, but when the whole business of the dairy is run on five-gallon cans and five-dollar payments, it will be readily seen that the farmers would be paying more than their fair share of this taxation. I do not think any other business can be instanced that makes so many small payments. Some of the creameries are big affairs, handling the
produce from thousands of farmers, and all of these farmers are doing business in a small way. But it must be borne in mind that these farmers are needed to make this country prosperous, and without a doubt such an unfair burden of taxation would be too much of a handicap on the business. Even if the minimum is raised to ten dollars, they would still be paying more than their share of stamp taxes, because only 25 per cent of their payments would be over ten dollars. In no other business are three-quarters of the payments under ten dollars. So you can see that this would be going after the small dairy man too hard altogether. For instance, ten small payments aggregating fifty dollars would involve five times the stamp duty which would be payable on a single cheque for the amount.
The minister has stated that we Progressives are in favour of direct taxation. We are; I told him so the other night. I believe the Progressives stand for direct taxation every time, but they want that taxation to be fair, and I point out to this House that this stamp tax on small tickets is very unfair for the simple reason that so many of the creamery accounts are paid by small tickets. A little under 50 per cent of these accounts will run over five dollars.


James Alexander Robb: My hon. friend a moment ago read a letter from the secretary of the Dairymen's Association stating that, seventy-five per cent of the payments were under five dollars.


Daniel Webster Warner: The percentage would vary in the different creameries. At best it is only a guess.


James Alexander Robb: But the quotation my hon.
friend gave a moment ago stated that seventy-five per cent of the payments were under five dollars.


Daniel Webster Warner: That might apply to that particular creamery. I am not quite sure what that letter did say, but from the various statements I have received covering a number of creameries I find that twenty-five per cent of their cheques are over ten dollars, and seventy-five per cent less than ten dollars. If I said five dollars I meant ten dollars. I think that is the way the statement ran, but I cannot delay the House to verify it now. I will give the minister the let'.er if he wrants it but am sure his idea of the statement in Mr. Love's letter is wrong. On these percentages it is obvious that the dairy business is paying a heavier stamp tax than any other business.
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Robert King Anderson: How often are the
payments made?
Mr. WARNER' Daily as the cream is delivered. The average payments, as near as we can get at them, run a little less than fifty per cent under five dollars. Straight taxation is all right, provided it is fair, but I take it that the figures I have given are proof enough that it is grossly unfair not to raise the minimum to ten dollars. However, I am glad the minister is willing to put the minimum even at five dollars, and I only hope that he will go further and meet our views. I am talking of the creamery business from personal knowledge, and I know that we as members of parliament cannot afford to put any extra burden on a business that is carried on in this way, that is, it issues more cheques for amounts up to ten dollars than any other business of which I have knowledge. We want to encourage rather than discourage the creamery business, and I believe every creamery man is willing to carry on his business in a fair way and to stamp everything over ten dollars. Anyone acquainted with the dairy business would have no trouble in understanding the unfairness of not raising the minimum to ten dollars.
Now I want to refer to a matter brought up by my friend from Mackenzie (Mr. Campbell). I believe that our people in the country would not dodge the 'tax if every fifty dollars had to bear its share of stamp taxation. This would permit the minister to raise the minimum to ten dollars. I had intended to move an amendment to increase
10 p.m. the minimum to ten dollars, but the minister having committed himself to the principle of exempting small cheques to the amount of five dollars, I rather hesitate to push my amendment. I sympathize with him in trying to get all the revenue he can for the country, but I do not believe he would lose much by acceding to our request. I believe yet that these creamery men will have to change their system of business. I think this is too heavy a tax, and that they cannot stand it. They will probably have to change their system to paying once a month or every two weeks. That would be a backward step, both depriving the farmer of the money for his daily expenses, and perhaps setting back the quality of butter a good deal. The farmers would not blame the creamery men, because the creamery men could not avoid it; they would blame the government. I do not think the government is going to get the revenue out of this tax they expect, because the creamery men will have to change their system, and that will

mean less revenue for the government, and also discredit as well. _ I would ask the minister therefore to seriously consider whether he cannot raise the exemption to ten dollars rather than five.


Robert Forke: I only want to say a few
words in connection with this matter. Who pays the taxes?


Some hon. MEMBERS:: What about the
stamp tax?


Robert Forke: I listened with a good deal
of attention to the remarks made by one of the members from Toronto. I think these gentlemen want to be fair. I really think that in making attacks on members in this part of the House and suggesting that the farmers are evading their taxes they do not mean to be unfair, but I want to call the attention of the House to the situation as we find it to-day. I can only speak for the western provinces; I do not know much about Ontario and Quebec. I have been a farmer all my life nearly, and have been used to handling small amounts of money. I do not know what it is to handle thousands and thousands of dollars, although I have handled some money in my time. At the same time I have paid some income tax. I do not like to speak in this personal way, Mr. Chairman, but one seems to be more easily understood when speaking from one's own experience. I want to tell hon. gentlemen in this House that I will be happy any year to pay income tax, and I would ask hon. gentlemen to my right, how can the farmers pay income tax if they do not make an income large enough to be liable to taxation? I see statements in the newspapers and have heard it stated at public meetings that the farmers are not paying their share of the taxes, and I have no doubt the men who make these statements think they are speaking correctly, but as a matter of fact the farmers for a great many years have not been in a position to pay income tax, but have been rapidly going in the hole. Those are the circumstances in which we find ourselves.
I know conditions in the western provinces; I know the conditions of the western farmer, and when I think of those homes and of the women milking cows and striving and struggling just to get the bare means of subsistence, and then when I come into the cities and see cars worth three and four and five thousand dollars and the evidences of wealth everywhere, it makes me indignant to hear hon. gentlemen get up and attack the farmer for not paying his share of the taxes. I am not playing politics; I have no intention of

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doing so. I simply want to see justice done. The farmers are just as honest, just as upright, just as straight as any other class of the community, and they will pay their share of the taxes when they are able to do so.


James Alexander Robb: 
Arthur John Lewis: I wish to make a reference
to the statement that the farmers do not pay income tax. I have here a statement from one of the live stock departments, I am not
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going to mention the name of the party concerned, and when the facts are disclosed there will be no need to wonder why we are not able to pay income taxes. In this case twenty-three cattle were sold and they weighed on the average a thousand pounds each. The total received for the twenty-three head was $474, but the following items must be deducted from that amount:
Freight charges	$42	35Yardage	
g	05Fire insurance	
15Feed	
7	80Brand inspection	
2	30Health certificate	
2	00War tax	
16Selling commission	17	00
That is to say the net total received for the twenty-three head of cattle was $394, or an average of $17 per head. That statement shows why, in some cases, it is not possible to pay income tax.


James Alexander Robb: Before we proceed further I
should like to put on Hansard the proposed sections of the act with respect to the stamp tax. First section:
No person shall issue a cheque payable at or by a bank or drawn upon or addressed to a bank and requiring or directing payment of a sum of money, 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, if the amount of money for which the cheque is issued, drawn or made
(I)	does not exceed $50, two cents;
(II)	exceeds $50, but does not exceed $2,500, for every $50 or fraction thereof, two cents;
(III)	exceeds $2,500, one dollar;
and every adhesive stamp affixed to such cheque shall be cancelled by the bank at which the cheque is payable at or before the time of payment.
That is the law as to issuing a cheque. Now if a man fails to do that he comes under section 7:
Every person who issues a cheque payable at or by a bank to which there is not affixed an adhesive stamp or on which there is not impressed by means of a die a stamp of the requisite value according to the requirements of this section shall be liable to a penalty not exceeding fifty dollars.


George Gibson Coote: May I ask the minister a
question right there? If the man who issues the cheque places a two cent stamp thereon has he not complied with the law, and would he be liable to any fine so long as he had put a two cent stamp regardless of the amount of the cheque?


James Alexander Robb: He must put on the stamps
which the law calls for.


George Gibson Coote: I was told by a banker that there had been a judicial decision to that effect. This was two years ago but the law may have been changed.


James Alexander Robb: The law was changed.


George Gibson Coote: I want to ask the minister if he could not change the law so that the bank would have to affix the stamps before the cheque was cashed, and to allow a man to issue the cheque without the stamp? I think one reason why this stamp tax has been referred to by so many people as a "nuisance" tax is that very often they do not have the stamps with them when they wish to issue a cheque; very often we are put to considerable inconvenience to get stamps. There are many small communities through the country where there are no banks and no excise stamps offered for sale. A person is liable to a fine if he issues a cheque without a stamp, and yet there are no stamps available. I think there would be far less objection to this tax if the government could introduce some new regulation under which the cheque might be issued without a stamp, leaving the bank to affix the stamp before charging the cheque to the man's account.
Before I sit down I should like to refer to the question which was dealt with so ably by the right hon. leader of the opposition, that is the stamp tax which is now charged on notes. I do not think this could properly be referred to as a "nuisance" tax. We must find some stronger term to use, and the mildest term I can think of that would be applicable at all is an "iniquitous" tax. The idea that a man should be taxed because he is in debt is to me iniquitous, and even that is too mild a term to use. I want to bring to the attention of the minister once more the figures that were given to me by a banker in my own province showing what it cost some of the farmers to pay the stamp tax on notes which had been renewed for some years and which they have not been able to pay. I have here a case where over a period of four years one man had paid $42.89 in stamp taxes on his note, and he had not been able to reduce the note by one cent in that time.


James Alexander Robb: On renewals?


George Gibson Coote: Yes. on renewals. I have another case where the tax over this period of over four years on the renewal of this one note amounted to $101.38. I was assured bv this banker and by other bankers as well, that they could give me a list running into hundreds of cases where there had been a tax on notes that the men were not able to reduce at all running in some cases from $10 up to $100 Now, I want to suggest to the minister-and I want to try and impress the fact upon him-that if he could not take this tax off notes that in all fairness he should

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reduce it to the same amount as the tax on cheques and provide a maximum amount of $1, the same as cheques. At the present time there is no maximum. The money which he would lose by taking the tax off these notes he could easily raise by putting a tax on coupons when they are cashed at the bank.
If cream cheques must bear a stamp when they are presented to a bank for payment I do not see why coupons should not also bear that tax. The minister might also consider the question of taking the tax off renewals although I may admit there might be some difficulty in administering that. I want to impress upon the minister that this tax is working a very great hardship. Not only farmers but retail merchants are complaining about this tax, and I think complaining with a great deal of justification.
Just a word before I sit down in reference to the statement made by one of the hon. members for Toronto in regard to farmers not paying income tax. The situation is simply this: If the farmers owe income tax and are not paying it the fault is with the Income Tax department. They should collect it. That is what they are here for. So far as I am concerned I would be glad to see every man who is liable for income tax compelled to pay it.


Daniel Webster Warner: Before we get too far away from the point under discussion I want to add a few words to what the minister has said. I want to point out to him that eastern Canada is an older settled country and it does not need these daily small payments so badly as the people do in the west. I want to point out to.him that the people who are running the new system get a better quality of butter by accommodating the farmers with daily payments, and that it would be a backward step to revert to the system of payment every two weeks or every month. They really and sincerely feel that it would be a backward step. They went ahead with this system and they put their butter on the world's market independent of other Canadian butter, and they brought the price and the prominence of the western butter to the attention of the consumers in the world's market in a way which had never been done until they worked out this system. They feel they have a good system and do not want to change it, and that is why I am presenting their case to the minister. Why make them change this system and go back to a system they have already discarded, when the government will not be able to get the revenue out of it, simply because they cannot afford to
pay and will have to change their system, rather than accept the five dollars instead of the ten dollars.


James Alexander Robb: I want to repeat again that
the government wish to encourage the dairy industry. I did not make this change without some consideration, or without having received some representations. Two gentlemen called at my office. I thought they represented the men who were complaining about this. I would not like to give their names. I thought they knew what they were talking about. They pleaded for ten dollars, but I said no, we could not lose that much money. They said finally before leaving, "Can you not rntke it five dollars?" As a concession to them, I am making it five dollars, but I am making it a little wider and I think the House should let it pass.


Daniel Webster Warner: I want the minister to
understand that I am not refusing the five dollars, but I desired to point out to him the way the creamery men felt on account of the fact that they would have to change their system. Although the minister does make it five dollars instead of ten, they feel it is a backward step. I am willing to accept it and under the circumstances I have already done so, but not without feeling that it should be ten dollars instead of five.


Mr. SPENCE:: The minister has been
good enough to explain the law in regard to putting stamps on cheques and the penalties. Will he be good enough to explain the law in regard to putting stamps on receipts. That is something nobody seems to understand. I am in a business where we have to issue two or three hundred receipts a week. Nobody seems to know whether we should put the stamps on monthly or weekly accounts if not paid in full.


James Alexander Robb: Receipts up to ten dollars
are exempt.


David Spence: I understand that. But
suppose you send out an account for fifty dollars and the man is only able to pay ten, do you require to put a stamp on that?


James Alexander Robb: I should think so, but I
will look into it.


James Shaver Woodsworth: May I call the
attention of the minister to a departmental ruling of the Customs department, file LB-1841, under which a merchant sending out a statement must put a stamp on it. It is complained of by a number of merchants in my own constituency because it involves in reality a duplication of taxes. I should like
Special War Revenue Act

to know if this could not in some way be altered.


James Alexander Robb: My hon. friend was not in
the House at the time, but this matter has been brought up already, and if he looks at Hansard to-morrow he will see my reference to it. It is quite new to me. It is a new ruling is it not?


James Shaver Woodsworth: Yes.


Robert King Anderson: I should like to call
the attention of the minister to one phase of this matter which has not been discussed. In connection with certain retail stores they have a system of keeping their accounts with a machine, and slips or statements are put in that machine and each statement contains or has on it an account up to that date. At the end of the month when the purchaser settles the account he receives the bills or slips that are in the machine. They are handed out to him and he pays his money, but pays no tax at all. There is no stamp put on the little slips or bills or invoices. In this way they avoid payment of the tax.


James Alexander Robb: Are they marked paid?


Robert King Anderson: No, just taken out of
the machine and handed to him. There is nothing in the machine to show the customer owes anything. Consequently they do not have to receipt a bill.


James Alexander Robb: It is not really a receipt?


Robert King Anderson: No, but by this method they are evading payment of the receipt tax.


James Alexander Robb: I quite believe my hon.
friend's statement, and I know there are many ways of evading the tax.


Leon Johnson Ladner: I do not know whether
this matter comes really under this resolution but many of us have received insistent and persistent requests to press the minister to the point of retreat on the question of the lien against real property for income tax.


James Alexander Robb: That matter is not under the
resolution but I am going to provide for it and will bring it up later.


George Newcombe Gordon: This is in reference
to the stamp tax.


Milton Neil Campbell: I should like to make
a reference or two to the remarks made by one of the members for Toronto. He said that the stenographer who wrote my letters paid more taxes than nine-tenths of my constituents. The statement is so far-fetched, so extreme and so devoid of all reason and 
truth that I almost hesitate to dignify it by making any reference to it at all. But when my hon. friend states that Toronto pays about 23 per cent of the total taxes of the Dominion, I wish to point out to him that those taxes in the last analysis are passed over to the rest of us who really pay them. We buy tens of millions of dollars worth of goods manufactured in Toronto, rubber belts, boots and shoes, hardware, clothing, machinery of all kinds and so on. The hon. gentleman is a business man and I presume operates his business on a cost plus basis, and every dollar of his expenses is passed back to the people who ,buy the goods. Toronto does not pay the tax. The taxes the farmer pays are not always visible, because after he pays the price of these goods he has not enough left to pay income tax. But he is paying a tax on every single article he buys, and if you take the four classes of primary producers, the farmers, the miners, fishermen and the lumbermen, they pay all the taxes.


Leon Johnson Ladner: Is not everybody else
paying the taxes likewise, excepting a little more so?


Milton Neil Campbell: The point I was trying to make is that if the average man in the city who is not a primary producer, raises his standard of living, that extra cost is automatically passed on to his business. If my hon. friend from Vancouver, who is a lawyer, finds he needs a two or three thousand dollar motor car that he had not used before, his standard of living is increased to that extent and he charges his clients a little more for his services on that account. The business men who use his services pay this extra amount. The men who buy the goods from these business men pay for that car, and in that way the price of the car is passed back to these people, the primary producers, who eventually pay. That is an economic law. One of the problems the primary producers have to face is that the people in the cities have raised their standard of living during late years beyond the standard of living of a few years ago, which means that the distribution of goods costs a great deal more than it did in the older days. If my hon. friend will just take the price of wheat at a given point in the prairie provinces, and take the direct freight to the city of Ottawa, and the fair cost of the milling, or the amount allowed the millers-


George Newcombe Gordon: I think the hon. gentleman is getting away from the resolution which is the stamp tax on cheques.

Special War Revenue Act


Milton Neil Campbell: I would respectfully
point out that this issue of taxation is involved.


George Newcombe Gordon: Under this item we are not discussing the general theory of taxation. It has reference to one specific form of taxation. I just want to interrupt the hon. member in order to draw his attention to the limitation of the debate.


Milton Neil Campbell: I will come down to the specific point. There is one thing against which I wish to protest. Before I left the West I was shown a note, not a very large note, on which were $8 worth of stamps. That note ran along for a long period. It was renewed every sixty days and on every renewal a new set of stamps had to be attached to it. That is a very great injustice. Surely the original amount ought to be sufficient, but every time that note is renewed, the whole tax is duplicated until you find in the end a tax of five, six, eight or ten times the original amount of stamps levied from the man who was unable to pay at the time his note fell due.
Mr. TO'LMIE: I am sorry that I have not been able to hear the whole of the debate, but I wish to endorse what has been said by some hon. members to the left with regard to the value of the daily payment for cream. There is, perhaps, no single industry in the whole of Canada that will do more good to the country, that will do more towards setting agriculture on a good, sound basis than the development of the dairy industry. In the western sections of Canada, out on the plains of Alberta, Saskatchewan and Manitoba, where these people live under conditions that are quite different from those of the eastern farmer, where they are scattered over wide areas, where they are not closely situated together, they live under a good many disadvantages at the present time, and it requires something to induce them to go into the dairy business. There has been this attraction, particularly in those years when crops have been short and when the people have not been very well off, that for every shipment of cream they have received the cash immediately. In conversation with men interested in the dairy business to a large extent in that country, it has been clearly proven to me that these regular, daily cash payments for cream have been a very strong factor in the development of the dairy industry in that part of Canada. I am very glad that the minister has listened to the dairymen to a certain extent inasmuch as he has extended to them an exemption up to $5.
I would rather have seen this extended to $10, but half a loaf is better than none.


George Gibson Coote: Would it be quite legal for
a man who issues a cheque and who has not a stamp in his possession, to write on the cheque after the amount, the words "and stamp tax?" That is about the only way in which a man living in a locality where tax stamps are not sold, can, it seems to me, remain within the law if he must issue a cheque?


James Alexander Robb: I cannot give my hon. friend a ruling on that now as the act is not administered by my department, but I will direct his observations, as I intend directing especially the observations of all hon. members who have spoken to-night, to those who administer the act. I think their idea is to make it as light as possible. Later on, my hon. friend will observe that I am making some changes to avoid the severe penalties there have been in the past.


[Stage Direction]
Resolution agreed to.
Resolutions 2, 3 and 4 agreed to.
On resolution 5:
James Alexander Robb: I beg to move that the resolution to amend the Special War Revenue Act, 1915, be amended by striking out the words "bill of exchange or" in the first line of clause 5. The clause as amended will read:
5. That any promissory note held by a bank as collateral security for an advance or other indebtedness and in respect of which advance or other indebtedness stamps of the requisite value under this section are affixed to the relevant bill, note or other proper document, shall not be subject to the provisions of this section. If such collateral is paid by a person liable thereon stamps of the requisite value according to subsection 3 (a) of this section shall before surrender thereof be affixed thereto and cancelled by the bank.


Edward Joseph Garland: What is the reason for the change?


James Alexander Robb: So that when the notes are
deposited as collateral, stamps will be affixed only when notes are paid.


Edward Joseph Garland: Why remove bills of exchange from being subject to this tax?


James Alexander Robb: To make it uniform and to
bring about simplicity in the administration of the act.


[Stage Direction]
Amendment agreed to.
Resolution as amended agreed to.
Resolution 6 agreed to.
On resolution 7:
Sir HENRY DRAYTON:: What is the
revenue from receipts? Last year we had a
Special War Revenue Act

number of instances where people were evading the law by not giving receipts, by sending in bilils stating that if a stub was torn off and sent back, that was sufficient, and no receipt was necessary.


James Alexander Robb: I will give -my 'hon. friend the exact figures -to-morrow. I do not have them to-night. I do not think there is any separation as between receipts and cheques. I think just the general revenue is given.


[Stage Direction]
Resolution agreed to.
On resolution 8:
James Alexander Robb: I beg to move that the resolution to amend the Special War Revenue Act, 1915, be amended by inserting after the word "patterns" in the second line of the second paragraph of clause 8 the words "and dies". The clause as amended will read:
8. That, subsection four of section nineteen BBB of the said act as amended by section three of chapter sixty-eight of the statutes of 1924, being the list of excepted articles not liable to the consumption or sales tax, be amended by striking out of said section three of chapter sixty-eight the words "gasoline engines to be used in boats bona fide used by individual fishermen for their own personal use in the fisheries" where they occur in lines twenty, twenty-one and twenty-two, thirty-eight, thirty-nine and forty, and fifty-eight! fifty-nine and sixty of said section three; and that the said subsection four of section nineteen BBB be further amended by adding thereto the following:
"Vegetable plants; lasts for boots and shoes including rubber footwear and patterns and dies for boots and shoes including rubber footwear; goods enumerated in customs tariff items 453e, 469a; articles and materials to be used exclusively in the manufacture of goods enumerated in customs tariff items 453e, 469a; materials, not to include plant equipment, consumed in process of manufacture or production which enter directly into the cost of goods enumerated in customs tariff items 453e, 469a."


Henry Lumley Drayton: What is the
estimated amount of the reduction?


James Alexander Robb: In connection with the sales tax it is estimated that it will be $2,500, but since then we have added dies.


Henry Lumley Drayton: How much more will that represent-another $500.


James Alexander Robb: Suppose we put it at $1,000.


Henry Lumley Drayton: Does the minister think that $1,000 will take care of the reduction?


James Alexander Robb: I hope so.


Henry Elvins Spencer: What is the customs tariff now on small farm engines of from one to five horse-power?


James Alexander Robb: If it is a traction engine it is free.


Henry Elvins Spencer: No, but small stationary engines.


James Alexander Robb: Speaking from memory I
think it is 27-J per cent.


[Stage Direction]
Resolution agreed to.
On resolution 9:
Henry Herbert Stevens: I want to ask a question under this item regarding the lien under the sales tax-I am not talking about the lien under the income tax. Has the minister some amendment with regard to the lien under the terms of the sales tax?


James Alexander Robb: If the hon. gentleman will allow this resolution to carry I shall move as resolution 9(a) the following:
Resolved, that it is expedient to bring in a measure to provide that an advance made by any person on the security of bonds, debentures, stocks or other securities, shall be taxable quarterly at the rate of 2 cents for every $50 or fraction thereof.


Henry Lumley Drayton: What is the
present bond?


James Alexander Robb: It is quite considerable. I might read the provision in that regard:
The bond or security to be given by licensed wholesalers or jobbers, as provided for under subsection 7, section 10BBB of The Special War Revenue Act, shall be for double the amount of the consumption or sales tax payable on the maximum amount of taxable sales made during any period of three months of the present calendar year.


Henry Lumley Drayton: This may make it worse.


James Alexander Robb: No, I do not think so.


Henry Lumley Drayton: It depends on
the turnover; in the case of a small merchant this is an added burden. In the case of the large merchant it is a relief, but it 'is the opposite with the small man whose turnover is limited.


James Alexander Robb: This was intended to get after houses that were not reliable.


Henry Lumley Drayton: It seems to be a stiffening up in one instance. Is it necessary?


James Alexander Robb: Yes.
Resolution 9(A) agreed to.


James Alexander Robb: I move as a new resolution,
9(B) the following:
Resolved, that it is expedient to repeal section 17 of chapter 47 of the statutes of 1922, which make* the liability to the crown for payment of excise taxes specified in the Special War Revenue Act, 1915 a first charge on the assets of the debtor.


Henry Lumley Drayton: What is the
effect of the amendment?

Supply-Re-establishment


James Alexander Robb: We are merely repealing that lien.


John Arthur Clark: Does this deal with the sales tax or the income tax?


James Alexander Robb: It relates to excise taxes. I
have a note from the Department of Justice forwarding a memorandum which outlines the objections to the legislation now on the statute books and the difficulties arising in the administration of it. The opinion is expressed in the memorandum that in view of these difficulties the legislation should be repealed.


Leon Johnson Ladner: Is the minister bringing
in a similar resolution in regard to the income tax as a lien against property?


James Alexander Robb: We shall come to that later.
Resolution 9(B) agreed to.
Resolution 9 agreed to.


James Alexander Robb: I move as a new resolution,
10(A), the following:
Resolved, that it is expedient to provide that the stamp tax imposed by The Special War Revenue Act, 1915 on a cheque, receipt for money paid by a bank, money order, traveller's cheque, post office money order and postal note, shall not be payable in respect of any of the said instruments which is for an amount not exceeding $5.


Leon Johnson Ladner: I understood that the minister was going to draw to the attention of the department the question of statements in regard to monthly balances owing. This question was raised by the Credit Men's Association?


James Alexander Robb: Yes.


Leon Johnson Ladner: Is the minister recommending the elimination of that?


James Alexander Robb: No. I shall direct it to the attention of the officers of the department, and see if they can give me any good reason for introducing it. It was only brought to my attention yesterday.


Leon Johnson Ladner: It was imposed once, then it was cancelled for some weeks, and a few days ago it was re-imposed.


James Alexander Robb: The complaint must come from some men who are dodging taxes.
Mr. LADNER' It is from the Credit Men's Association of Canada.
Resolution 10 (a) agreed to.
Resolution 10 agreed to.
Resolution 11 agreed to.


REVISED
[Stage Direction]
Resolutions reported, read the second time and concurred in. Mr. Robb thereupon moved for leave to introduce Bill No. 118, to amend
the Customs Tariff, 1907.
Motion agreed to and bill read the first
time.

[Stage Direction]
Resolutions reported, read the second time and concurred in. Mr. Robb thereupon moved for leave to introduce Bill No. 119, to amend the Special War Revenue Act.
Motion agreed to and bill read the first time.

[Stage Direction]
The House in committee of Supply, Mr. Gordon in the chair.
Soldiers Civil Re-establishment-salaries, $21,500.
Hon. H. S. BELAND (Minister of Soldiers' Civil Re-estabilishment):: Mr. Chairman, there is not much change in this vote. There were eight employees last year, there are six this year, the supervisor of expenditures and the head clerk having been dispensed
11 p.m. with, which accounts for the reduction in the vote. The reason that the civil government vote has always been presented in this way is, I think, that originally it was intended ,to mention only the permanent staff, and it does not in any degree reflect the number of employees of the department.


John Arthur Clark: How many employees are
covered by the item?


Henri Sévérin Béland: Page 102 gives the details: One deputy minister; one assistant deputy minister; one assistant secretary and chief Clerk; one principal clerk; one storekeeper; one departmental! librarian. In addition there is an allowance of $600 for a private secretary.


Henry Herbert Stevens: I do not want to be
charged with reflecting on any of these civil servants, but would the minister tell me how many deputy ministers lare in his two departments, Soldiers' Civil Re-establishment and Health?


Henri Sévérin Béland: There is a deputy minister in each department.


Henry Herbert Stevens: Again I do not want to be charged with any reflection on these gentlemen, but we have before us a vote for $6,000 for a deputy .minister of this department and another vote of $5,000 for an assistant deputy minister. No doubt they are competent and



EDITION

[Stage Direction]
Supply

Re-establishn-ent
[Stage Direction]
capable officials, but they preside over a staff of only four. Does it not look to be just a trifle top-heavy, $11,000 for two first class, highly trained, competent -men to preside over so small a staff? Frankly, I think the time has arrived when we must look that fact in the faice.
Henri Sévérin Béland: I am very glad, Mr. Chairman, that my hon. friend has asked the question. The number of employees in the department is not 6; it is 2,422.


Henry Herbert Stevens: That is very nice. That is the number in this particular branch?


Henri Sévérin Béland: Yes. I have endeavoured to explain that originally, under the former administration, only six or perhaps a few more, perhaps ten or twelve in all, were mentioned in the civil government estimates, the reason being that the large majority, practically the totality of the members of the department, some 8,000, were only temporary employees. They have been reduced in number very considerably year after year. During the former administration the number of employees was reduced in some years by over 1,000, perhaps 1,600; three yeare ago the number was reduced by 1,000, and two years ago by some 700 or 800. Last year again, the number was reduced by 600, or thereabouts. The number of employees still drawing salary in the department is 2,422.


Henry Herbert Stevens: What does that include?


Henri Sévérin Béland: It includes all the employees in the administrative work, all the employees in the Vet Craft shops, all the employees in the limb factory, all the employees and doctors in the hospitals of the department, all the physicians who are employed full-time outside of the hospitals for pension examination, and so forth. In a word, it includes all the employees of the department. The number of these employees on the 1st January, 1924, speaking from memory, was 2,922. On the 1st of April last, the number was 2,422, so that during thirteen months, continuing the reduction process which had been started, the number of employees had been reduced by 500.
Perhaps this w7ould be a proper occasion to set right some opinion which has been expressed as regards the cost of administration of the Department of Soldiers' Civil Reestablishment. Speaking personally, I have not the remotest desire to be in charge of the department one day longer than I am desired, but I must say that the work which is new being discharged in Canada in connection with this depa:tment will be maintained for a large number of years to come, and the num-

ber of employees engaged in the work of the department will be reduced by a smaller margin as the years go by. The time will come, I should say within five or six or perhaps ten years, when you will not be able for a long number of years thereafter to reduce the number any further. And why? Because the department has the whole administration of pensions, which involves the paying out in one year of $34,000,000. It would be a simple matter to pay $34,000,000 to one man, but it is an altogether different thing when you have to pay pensions to 64,000 different people every month, and when a large number of those pensioners are not permanent in their disability, thousands of them in the course of one year being either reduced, cancelled or increased, thousands of new pensions being awarded during one year, and hundreds, if not thousands, of children being bom to pensioners and who have also to be taken into account. That is one feature of the work.
But there is another feature, and that is the paying of pensions to Imperials in Canada. The amount that is being paid on account of the Imperial government to Imperial pensioners in Canada is around $10,000,000. The department is acting in Canada for the Imperial government in regard to these pensioners.


Arthur Edward Ross: Is not that a large increase? Last year it was only $7,000,000.


Henri Sévérin Béland: Yes, there is a large increase.


Arthur Edward Ross: To what is the increase due?


Henri Sévérin Béland: That includes also the pay and allowances which are paid to Imperial pensioners who are under treatment in Canada.


Thomas Wakem Caldwell: Is this $10,000,000 of
Imperial pensions included in the $34,000,000?


Henri Sévérin Béland: No, it is in addition to
that.


Robert Alexander Hoey: Do the Imperial authorities
pay the cost of administering those pensions.


Henri Sévérin Béland: They do. We are reimbursed, but we have to provide the money in the first place. -We have a section in the department which is called the Imperial section, there being 105 employees in that section alone.


Arthur Edward Ross: The increase in
Imperial pensions seems enormous. Are there more Imperial pensioners coming out?

Supply-Re-establishment


Henri Sévérin Béland: Perhaps there are. I can
give later on when we consider the item for pensions the exact number of Imperial pensioners in Canada last year and this year. Now I am just making a general statement.


Thomas Wakem Caldwell: Is the Dominion government reimbursed by the Imperial for both the Imperial pensions and the cost of administering those pensions?


Henri Sévérin Béland: Yes. I want only to set
at rest the minds of my hon. friends on the other side; for instance, the hon. member for York-Sunbury (Mr. Hanson) and the hon. member for Yale (Mr. Stirling), whose presentation 1 very much admired the other day. I did not care to interrupt the hon. gentleman, 'but he went so far as to say, unintentionally and unwittingly, I am quite sure, that 71 per cent of the amount of money which is voted for this department goes into administration expenses. If it were true, if half of this were true, if only one-quarter of it were true, I would be the first man to be scandalized. As my hon. friend from York-Sunbury has said himself, it would indeed be scandalous. But what is the situation in this connection? I appeal to my hon. friend from Yale not to stake his reputation on the statement he made in this connection, because it is absolutely inaccurate. What is the total amount involved in this department in one year? It is $51,000,000, and every cent of it is administered by the Department of Soldiers' Civil Re-establishment. Now how did my hon. friend contrive to arrive at the figure that 71 per cent of $51,000,000, or whatever it is, has been expended in administration? My hon. friend said that only a small share of that money goes direct to the men; the balance of it is expended for salaries and administration. Now what are the facts? I ask the question without any idea of creating the impression that my hon. friend has been misleading the House. I do not think it was his intention; nor do I think it was the intention of any newspaper man who publishes such broad and unwarranted statements; but it is time-it may be late in the day; perhaps it should have been done long ago-that this matter should be explained fully to hon. members. Let us take the amount which goes directly to the men in cash. In the first place the sum of $33,048,000 is paid in pensions. This is money that goes to the men or to their dependents without the omission of one cent. The balance left from that $51,000,000 would be about $18,000,000. How is that made up? In round figures the sum of $4,463,000 is paid 201J
to tihe Imperials either in pension or in pay and allowances. Is there anything else being paid to the men in cash? Surely. What else? Pay and allowances to the men who are being treated in hospitals. The men who are admitted into hospital for treatment receive not only shelter, clothing, food, and medical care but they receive also pay and allowances. But the amount paid to the men under treatment varies according to whether the man is single or whether he has a wife or a wife and children. The amount of pay and allowances is $2,314,044.59. This money is paid in cash to the men or their dependents. There are also pay and allowances made under a certain order in council and the total of the two classes of payment is $2,816,000.


Henry Lumley Drayton: That figure does not agree with the vote.


Henri Sévérin Béland: My hon. friend does not take into consideration other allowances, smaller in character, which help to make up the total. The hon. gentleman may accept my word that the pay and allowances amount to $2,816,000. Add the $33,000,000 odd for pensions to Canadians, or to the dependents of those men, and the $4,463,000 paid to the Imperial pensioners in pensions and pay and allowances. There are still other sums that go to the men in cash. We must consider the salaries that are paid to the men in the craft shops under the jurisdiction of the department; they must be paid because they are suffering from disabilities that do not permit them to seek employment elsewhere. We have three or four hundred of these men employed by the department in shops and these men draw their salaries in cash. Now let us take insurance. The department administers a soldier's insurance which is not a very considerable branch.


John Arthur Clark: Before the minister passes to the subject of insurance, can he tell us what the administration expenses are for the payment of all the pensions?


Henri Sévérin Béland: Yes, I am coming to that; I will be pleased to give my hon. friend those figures.


Henry Lumley Drayton: The minister
did not state how much is paid for salaries in the craft shops?


Henri Sévérin Béland: In wages to operators
$95,822. Now let us take vocational loans, that is to say the loans made to the men who have completed a course of vocational training under the department and who secure a loan from us in cash for the purchase of
Supply-Re-establnhment

equipment. The money thus paid to them in cash for the year 1923-24 was $37,893. The war service gratuity is also money paid to the men in cash. Now we come to the returned soldier's insurance-


Mr. POWER:: Will the minister be kind enough to tell us how much was paid in war gratuity last year? It would not amount to much.


Henri Sévérin Béland: It is a small amount,


Charles Gavan Power: The amount should be diminishing every year.


Henri Sévérin Béland: It is, yes. Now on account of the deaths of soldiers who carried insurance with the department we paid out during the same year $241,887 in death benefits; $203,704 in annuities; and $917 in disability benefits. Then there must be considered cash surrender values, return of premiums, and so on, making a total paid in cash to the men in connection with returned soldiers' insurance of $483,000. Surely not a single one of the amounts I have mentioned can be claimed as money spent for administration. Out of the total of $41,000,000 odd that I have mentioned there is not a single cent which is not paid directly to the men.


Edward Joseph Garland: Would the minister be good enough to give us the figures for the amounts paid to disabled men who are in the employ of the department, in their own shops? He has overlooked that figure.


Henri Sévérin Béland: Ninety-five thousand dollars odd.


Robert King Anderson: Do they correspond
with the figures for 1923-24.


Henri Sévérin Béland: Yes, they correspond closely with the figures for that year.


Robert King Anderson: I think there is a difference.


Henri Sévérin Béland: We had a supplementary
estimate that year which probably accounts for the difference. The hon. member is referring to the main estimates.


Henry Lumley Drayton: The estimates
of last year are before us.


Henri Sévérin Béland: I refer to the year 1923-24. That is the statement I have. But they coincide pretty well from year to year. Now let us consider another point. In addition to this amount which is paid in cash to the men or their dependents a large amount of
[Mr. BSland.j
money is paid for services rendered to the men. For example: We have the item of medical attendance upon soldiers who require an operation, or who require any medical treatment. I ask any hon. member in this House, in all sincerity, is that money which is being expended for attendance on a soldier in a hospital not equivalent to money which is paid to him direct? It is for a service which is of benefit to the men; and if you handed the money to the man himself he would employ it for that very service. Are the services of nurses attending our soldiers not to be considered as equivalent to a direct payment, inasmuch as if we handed the money to the men they would pay for the services of the nurses? I will go one step further. Is not the money which is being spent and paid to experts, skilled workmen, to make limbs for the thousand amputation cases which we have in Canada equivalent to the money paid to the men themselves? If we supplied the money to the amputation cases what would they do with it but provide artificial limbs? I quote these as examples. We have a large number of medical men in Canada employed in this department. I have the figure here and I will give it later. These men are not employed for administration purposes, except in very few instances, but they are employed for the purpose of rendering certain services to the men, which is equivalent to paying the money to the men themselves. What is the amount of money which is being used for those services? It is $5,648,118.


Henry Lumley Drayton: Which item of
the estimates is that under?


Henri Sévérin Béland: Care of patients, for instance, employer's liability compensation, vocational training, transportation of blinded soldiers, sheltered employment and so on. Now what is the amount that is to be used for administration purposes? I desire to make a general statement of the cost of administration. First, we have general administration salaries, $1,806,358. I grant you that is a large amount, but not at all disproportionate to the administration that is required for it.
Now under the heading "General" we have:
Telephones, telegrams and postage	 $51,689
Transportation and travelling of staff	 53.760
Stationery, printing and office supplies.. ..	66,164
Rent, taxes, insurance and bonding	 8333
Light, heat, power and water rates	 11,864
Maintenance and repairs	 4,000
Automobile supplies and expense	 15,454
Freight and express	 6,577
Advertising and publicity	 1.918
Miscellaneous supplies and expense	 31,381

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Making a total of $250,491. Then we have: Medical administration-
Salaries-
Medical services	 $337,976
Dental services	 10 971
Provisional bonus	 21,653
Making a total of $368,201.
Then we have under the heading of "General" in connection with medical administration the following items:
Telephones, telegrams and postage	 $10,440
Transportation and travelling of staff	 28,042
Stationery, printing and office supplies.. ..	15,828
Automobile expense	 3 ^
Miscellaneous supplies and expense	 2,137
Making a total of $59,941, or a grand total of $2,4S5,645, which is equivalent to a little below five per cent of the amount that is being administered by this department.


Henry Lumley Drayton: Look at vote 284, and you will see that under the heading of salaries you have administration, insurance and training, hospitals and clinics, making altogether an amount of $3,100,000. Last year it was considerably greater. They are all put down as salaries here.


Henri Sévérin Béland: I agree with my hon. friend, but I have attempted to point out that under the item of salaries is included the salaries of all these parties I have referred to, all the physicians in the hospitals, all the physicians outside the hospitals engaged in the examination of pensioners all over Canada, probably 30,000 disabled pensioners, who are examined under the instructions of the board every six months. Then we have the nurses, the staffs in the hospitals, orderlies and so on. The item for salaries covers them all. So that I say, Mr. Chairman, it was an unhappy reference by, I think, my hon. friend from Yale (Mr. Stirling) the other day. I do not think the hon. member has given this matter the proper attention and perhaps he was led into making the statement because he had read something in the newspapers about it. But those are the conditions. That the staff should have been reduced every year as the years went by was conceded by everybody, and the staff was reduced year by year to a large extent. Since I have been in the department I have no doubt we have reduced the number of employees by over 3,000. We have reduced the number in the course of the last year, plus one month, by 500, and I pray hon. members to note that a large proportion of these employees are returned men themselves and in many cases disabled soldiers. It is always a difficult task for any minister to retire an employee in a department such as this. It is perhaps an easy task for my hon.
colleagues to retire officials, but it is painful to be obliged to retire men who have-seen service and suffered disability, who-have wives and families, and who are receiving a salary of $1,200, $1,500 or $1,800. It is not agreeable. It would not be agreeable to any man. We take all necessary precautions in these reductions of staffs. We notify the man beforehand; we give him two or three months' notice, and we provide for the payment of two months' salary after retirement. If a man, who has been a faithful servant, but who is surplus, finds that after two months he is unable to secure employment, and if he claims that he should have one more month in order to attempt to secure a job somewhere else, we allow it. But administer it in any way you like, it is a painful and difficult task, and I do not think you could decrease the number by more than fifty a month at the best. That is what we have been doing. I have given this explanation because it was due to hon. members. I am quite certain that in many minds the idea prevails that at least fifty per cent of the money voted in the House of Commons for the soldiers was money that went for administration expenses. That is absolutely beside the mark. The department does not claim perfection. The department has been administered by men of ability, regardless of who was the head under the previous administration or under this administration, by men who have seen service overseas, everyone of whom, with barely one or two exceptions, has seen honourable service in France. It is only due to them that we should tell the House that they are working every minute of their time, and to my personal knowledge, after hours fifteen days in a month. The situation cannot be otherwise because, when you retire in one week ten or twelve people, they were doing something. While perhaps they were not doing a day's work, you have to load other employees with the work, and they have to go back to their office after five, or six or seven o'clock in the evening in order to acquaint themselves with the new work that has been placed in their care.
The idea has prevailed that the medical staff is too large. I have myself many times felt that, perhaps, we should be able to reduce the number of physicians whom we employ in our hospitals. I look at Christie street in Toronto where there is a large hospital with five or six hundred patients, patients who come in and patients who go out, some who remain for two, three or four years and some who remain for one month or two or three months. We have a large staff of medical men there. But that is not all. Not only are the medical
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men working in the hospitals, but they are administering what we call clinical treatments to hundreds at Christie street hospital. I have seen that mysallf. I wanted to satisfy myself that such was the condition. Last year we administered more than 160,000 different dlinioal treatments. When a soldier comes into a hospital or the unit-it is the same place now in Toronto because we have contracted the service and everything is now under one roof-seeking treatment, it is impossible to say to that man: You are looking for treatment; you cannot have it; you have to go out; you will) not be attended to. That mian must be admitted and you must have a physician examine him. His case may require services of a specialist or, perhaps, two or three specialists. This is now about seven years after the war. A disability that has been recurrent after two, three, four, five or six years may be very much complicated, and it may require an X-ray man to take radiographs of this man's body. It may require a surgeon to ascertain that an operation is not needed. Heaven knows that we make mistakes, especially in the medical profession. It is too well known that in many oases the diagnosis is not made as it might be; but, as the hon. member for Kingston (Mr. Ross) knows that is the weak side of our profession, and unhappily amongst our medical men there are some who make mistakes like the rest of us. You have to examine this man; you have to delcide whether he requires treatment or not, and you have to admit him to hospital or to refuse him. Alii that requires services, and nobody will give you those services for nothing, especially if it is the government that requires the services. It is my expectation that the number of employees will be further reduced in the course of the present year by a few hundred and probably next year also, although the number of patients is about the same as it was twelve months ago. When we are on this item "care of patients", I might explain that last year we Laid in our hospitals, I think 3,730 patients, and the last figure I 'have of patients under treatment is 3,704, or only a few less than last year. It is sometimes claimed that the department is too severe, that our medical men are refusing treatment to people who are entitled to treatment. I do not know whether this accusation is well founded or not, but at all events I have never heard that the medioal men in the employ of the department have allowed into the hospitals patients who should not be allowed. I do not know of any man who is being treated to-day who does not deserve treatment. It may be that some may claim that a few soldiers are not being treated '
who are entitled to treatment. In the last instance we have to abide by medical opinion, because this is largely a matter of medical appreciation. I am sorry that I have detained the committee so long, but I thought it was only fair that I should give hon. members this explanation.


John Arthur Clark: I asked the minister during
his remarks to state the cost of the administration of pensions. He said that he would give me the figures, but he has not done so. I would like to draw the attention of the committee to one point in connection with a statement made by the hon. member for Yale (Mr. Stirling), who does not happen to be in his seat at the moment. That hon. member did not refer to the amount that is being expended for pensions nor to the cost of administration for pensions. My impression has always been that the cost of administration for pensions is comparatively small. The hon. member for Yale was referring to an entirely different matter. He was distinguishing between the cost of administering pensions exclusively, and the other branch of soldiers' civil re-establishment, and if any statement has been made which is not correct the hon. member for Yale will be only too glad to see it corrected. I invite the minister now to give a concise statement of the cost of administering pensions as distinguished from soldiers' civil re-establishment.


Henri Sévérin Béland: There is no information
available on the question. There is no proper administration of the pensions except that which is being carried out by the department; there is no administration of pensions outside the department.


John Arthur Clark: Is there no information
available to enable the minister in the future to tell us how much it costs to administer pensions to the extent of $34,000,000 annually?


Henri Sévérin Béland: It would be very involved
accounting work, although it might be done. The hon. member will bear in mind that the employees who administer the allowances to the men in hospitals also administer pensions. We have only one department under one roof in Ottawa; all these employees are at their desks and do whatever work of administration is required of them. At one time pensions were administered by a pension board entirely outside of the department; that was previous to 1921. It was my immediate predecessor who combined both the administration of pensions and that of the re-establishment department proper. At the time that was done about 800 employees were

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transferred from the Board of Pension Commissioners to the Department of Soldiers' Civil Re-establishment and the amount of money paid for the administration of the pensions by these 800 employees was some $880,000. That is the only information available. It may be that after many years of practice and training on the part of the employees the amount would be much smaller if the administration of the pensions were entirely in the hands of a separate board; but at the time of the merging of the two branches there were transferred to the department proper, as I have said, some 800 employees.


Henry Lumley Drayton: The way the
estimates are prepared invites the kind of comparison which the minister complains of.


Henri Sévérin Béland: I grant you that.


Henry Lumley Drayton: There is nothing whatever in the vote for the soldiers' civil re-establishment, on its face, to show that there is anything in it having regard to pensions, while on the other hand item 94 provides for salaries and contingent expenses of the Board of Pension Commissioners for Canada. Under the heading of pensions we are paying $109,380 in salaries. It is obvious therefore that anyone taking up the government's figures must work out the same result and come to the same kind of mistake, if it is a mistake, as did the hon. member for Yale.


Henri Sévérin Béland: Item 94 has no reference at all to administration; the amount of $89,000 as'-ed for covers the salaries of the immediate personal staff and ten medical advisers. I grant you that, placed as these figures are in the estimates, my hon. friend from Yale might have been misled; but he should not have been misled to the extent of saying that 71 per cent was going into administration. That was absolutely beyond the mark. But if the item for pensions were placed with the estimates of the Department of Soldiers' Civil Re-establishment, it would be seen immediately that the amount paid out in administration in this department can compare favourably with the cost of any other department in the government or of any business corporation in Canada. At any rate, not being a business man myself, that is the information I have received from an accountant of experience whom I asked to give me the real situation.


Henry Lumley Drayton: Now, the minister graciously told us that he did not want to hold the committee. It is now ten minutes to twelve; can he not let us go? I make this suggestion with certain feelings of commiseration for the minister; I dislike to see all the government's pre-election statements going by the board one after another. I dislike to see the promise in regard to eleven o'clock adjournments being broken.


Mr. CAHILL:: That is not a pre-election
statement.


Henry Lumley Drayton: If we are unable to rely on the pre-election statements of the government, at least we might be pardoned for assuming that we have some right to rely on their statements made since we have been in this House. I suggest that we might pass this item and adjourn.


Henri Sévérin Béland: Surely, after all my exertion in giving the long explanation I did to the committee, an explanation rendered unavoidable by reason of the statements made by the member behind my hon. friend, he will reward me by allowing a larger item to pass. I was expecting that the whole estimates of the department would be adopted to-night; I have given a long explanation and supplied a good deal of information.


Henry Lumley Drayton: I made a very
fair proposition to my hon. friend. We will let the item go through and adjourn.


Arthur Edward Ross: On this item, we
have been so far discussing matters relating to something else. While I have little to say about this particular vote I shall have a good deal to say on some other items. There are certain items on pages 22 and 23, and on page 56 again we have votes for soldiers' civil re-establishment. Some of these subjects I should like to deal with.


Henri Sévérin Béland: Let us adopt a few items
to show that we want to make some progress.


John Arthur Clark: I think the minister has
had enough experience of members on this side of the House to know that we wish to do everything to facilitate these matters, but it is most unreasonable for him to expect us at this late hour to go into these items in an intelligent manner, and in fact it is unfair to the soldiers to attempt it.


George Newcombe Gordon: 'Shall item 36 carry?


Henry Lumley Drayton: We want to see on what understanding it is carried. If we adjourn afterwards it will be all right. I thought I made a very fair offer ten minutes ago.


[Stage Direction]
Item agreed to.
Progress reported.
Questions
[Stage Direction]
On motion of Mr. Mackenzie King the House adjourned at 11.55 p.m.
Wednesday, May 13, 1925