May 20, 1921

CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

I appreciate the point my hon. friend makes. The fact is that none of those items he has referred to are produced in the West Indies; they have none of those manufactures there. They are very much interested in the cocoa bean, Item 77A, and, indeed, that is the item which necessitates the changes that my hon. friend has referred to. The West Indies produce the cocoa bean, and England manufactures it into these commodities, as my hon. friend says. We also manufacture it into the same commodities. The West Indies are only interested in getting their preference in connection with the cocoa bean, which is given to them as called for by the agreement.

Supplementary to what my hon. friend from Shelburne and Queen's (Mr. Fielding) has said as to the general principle, I would say that while England must always get her goods in certainly at as low a rate, if not lower, than foreign countries,-and that has been pretty well accepted of late- it has not been applied and extended to other British possessions. I would also point out that that principle was borne in mind by the hon. gentleman in bringing down his British preferential tariff. He held the general principle clearly in mind as to the effect of the British preferential tariff having regard to the benefit that was to be given to England, but he did not regard that as fettering his action in connection with what ought to be done to other and perhaps more necessitous parts of the British Empire, or to other parts of the British Empire where perhaps it pays Canada to work up a more intensive trade. For example, I direct attention to section 8 of the customs tariff implementing the arrangement made by my hon. friend in 1907, which says:

Notwithstanding anything in this Act, fish and other products of the fisheries of Newfoundland may be imported into Canada free of ail customs duty until otherwise determined by the Governor-dn-Council, by order published in the Canada Gazette.

The direct result of that was to provide that Newfoundland could get her fish and fish products into the Canadian market free while Great Britain had to pay a British preferential tariff. There is no change in principle at all; it is simply a case of fish in one instance and cocoa beans in the other.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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UNI L

William Stevens Fielding

Unionist (Liberal)

Mr. FIELDING:

I do not quite see the force of the illustration with regard tb Newfoundland. However, the point raisejd by the hon. gentleman from Renfrew is in regard to preserved fruits, etc. Of all the articles mentioned, only one, I think, can be regarded as manufactured by Great Britain. Now, the revenue obtained by insisting upon a difference in rate on this one article would not amount to much, and I cannot see that any great harm would be done from the revenue point of view to say that any of these articles coming from Great Britain shall come at the rate granted the West Indies.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

The particular fruit item that the hon. gentleman refers to gives the preference to nobody; it is the same all round.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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UNI L

William Stevens Fielding

Unionist (Liberal)

Mr. FIELDING:

That is so; I had not

noticed that.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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L LIB

Isaac Ellis Pedlow

Laurier Liberal

Mr. PEDLOW:

But it doesn't appear in the item, and a merchant placing an order for preserved fruits from the West Indies might expect to get that product at a rate fifty per cent less than the rate given in the general tariff, but when he came to make his entry at the customs house he would find that the ruling was otherwise.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

These items

refer to fruits preserved in alcohol.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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L LIB

Isaac Ellis Pedlow

Laurier Liberal

Mr. PEDLOW:

Suppose a British manufacturer, seeing the advantage of having these cocoa beans manufactured into paste or chocolate powder, installed a plant at some point in the West Indies and turned out the product there, thus obtaining the benefit of this preferential tariff of fifty per cent as against his competitor whose factory is established at some point in England, what is my hon. friend's opinion as to

the result of that condition?

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

I think the

question that would arise there would be whether we thought it worth while to continue our own activities in the production of sweets and that sort of thing, or whether we should bring them to an end. That would really be the consideration should such an eventuality arise. I do not think, however, that there is much danger in that regard.

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Item agreed to. Items 135, 150, 151 and 153 agreed to. On item 156: Tariff Items British Preferential Tariff. Intermediate Tariff. General Tariff.156 Ethyl alcohol, or the substance commonly known as alcohol, hydrated oxide of ethyl or spirits of wine, n.o.p.; gin of all kinds, n.o.p.; whisky and all spirituojis or alcoholic liquors, n.o.p.; amyl alcohol or fusel-oil, or any substance knowui as potato spirit or potato oil, methyl alcohol, wood alcohol, wood naphtha, pyroxylic spirit or any substance known as wood spirit or methylated spirits, absinthe, arrack or palm spirit, brandy, including artificial brandy and imitations of brandy, n.o.p.; cordials and liquers of all kinds, n.o.p.; mescal, pulque, rum shrub, schiedam and other schnapps; tafia, angostura and similar alcoholic bitters or beverages; and wines, n.o.p.; containing more than forty per cent of proof spirit, per gallon of the strength of $10.00 $10.00 $10.00


UNI L

William Stevens Fielding

Unionist (Liberal)

Mr. FIELDING:

Does this cover alcohol used for manufacturing purposes, by chemists and others? As regards spirits for beverage purposes, I do not want to make any complaint;-that is a matter in which the provinces of British Columbia and Quebec are interested; the other provinces cannot get any liquor, so that there is no need of making any fuss about the matter. Has my hon. friend received representations in regard to alcohol used for manufacturing purposes? I have had telegrams from druggists stating that their business is seriously affected by the increased duty on alcohol for chemical and manufacturing purposes.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

That is dealt with under the excise item. This is the customs item.

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UNI L

William Stevens Fielding

Unionist (Liberal)

Mr. FIELDING:

It is not covered by this item?

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

No.

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L LIB

Ernest Lapointe

Laurier Liberal

Mr. LAPOINTE:

I read in the press that the Attorney General of British Columbia has expressed the opinion that this Parliament cannot impose a tax on alcohol which is provincial property. Has the Government any legal advice on the matter?

in the amendment of the Customs Act of 1917.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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L LIB

Ernest Lapointe

Laurier Liberal

Mr. LAPOINTE:

I would not like the

impression to prevail that the Government of Quebec, at least, is entering a trade under the law that was enacted last session. It is certainly not to enter the trade that this law was passed; on the contrary, it is rather to serve the purpose of temperance, to remove temptation and to avoid abuses which existed formerly. The question of making money not only is secondary, but does not exist at all. The Government have no right to treat the provinces of British Columbia and Quebec as traders in the matter.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

I am very

much pleased to hear what my hon. friend says, namely, that the province is not in this business for trade. The province is in it for the purpose of reducing the consumption of drink; to make respectable something which my hon. friend does not think has been quite respectable in the past; to perform a useful service. That business paid taxes in the past, and as the province is not in it for money, the imposition of these rates cannot in the slightest degree interfere with the fruition of its benevolent object.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

Yes, the position of the Government is that when governments become traders, their trading operations are subject to taxation. Of course, if that were not so, it would be possible for a Provincial Government to remove practically entirely articles of taxation from this Government. The principle is not a new one, because it was introduced by this House into the statute book

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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L LIB

James Alexander Robb

Laurier Liberal

Mr. ROBB:

If I understood correctly

the Minister of Finance a moment ago, he said that the Department of Justice advised them that when a province entered upon business trading, it is subject to taxation. My recollection is that at a recent session of this Parliament-and I am not sure whether it was the present Minister of Finance or his predecessor-on a question somewhat similar to this, a ques-

tion of taxation, the Minister of Finance * gave a ruling that the hydro-

5 p.m. electric companies of Ontario were exempt from the effects of taxation, while incorporated companies doing business in other provinces were subject to taxation. It was very strongly contended upon this side that that was an unfair attitude to take. The Miniser of Finance of that day ruled that the provinces doing business were exempt from taxation. Either the Department of Justice is giving different advice in this regard, or the Minister of Finance, at a previous session, offered an opinion without having consulted the Department of Justice.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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CON

Henry Lumley Drayton (Secretary of State of Canada; Minister of Finance and Receiver General)

Conservative (1867-1942)

Sir HENRY DRAYTON:

The situation is hardly as bad as that. Ip fact, I would be only too happy to say at once that we will treat Quebec in this matter in precisely the same way as we have treated the hydro-electric. We are not here seeking to tax the income of Quebec. We are saying that imports of whiskey shall not become exempt because they are' imported in the name of the province for the purpose of reselling. I think that is the position taken by the hon. member for Quebec East.

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Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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L LIB

James Alexander Robb

Laurier Liberal

Mr. ROBB:

I do not take that position.

Topic:   WAYS AND MEANS
Subtopic:   CUSTOMS TARIFF, 1907, AMENDMENT
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May 20, 1921