On the motion of Hon. W. S. Fielding (Minister of Finance) for Committee of Supply:
Mr. JOS. T. SHAW (Calgary West): 1 want to take this opportunity, Mr. Speaker, of bringing to the attention of the House the application of the existing sales tax in so far as it affects public libraries. I am impelled to take this action at this particular time because I read in the public press that the Minister of Finance (Mr. Fielding) is not averse to receiving suggestions from outside deputations with regard to the approaching budget, and it occurred to me that perhaps he might not be unwilling to view with favour suggestions made by members of this House.
Under the operation of the existing sales tax public libraries are subjected to a 6 per cent tax on books imported from foreign countries. And may I say at the outset that the majority of our books are imported? If these books are not imported directly they may be purchased, as they often are, from Canadian wholesalers, in which event a sales tax is charged the library of some 2i per cent; but in the price charged by the wholesaler is included the price which he must pay by way of sales tax, totalling 3| per cent. Therefore, in any event the library must pay a sales tax of 6 per cent on its purchases.
Another factor that is of great importance to public libraries is the matter of bindings, which they use very considerably. Bindings are subject to a sales tax of 4J per cent. Now, it is rather a strange coincidence that while libraries have been exempted so far as their purchases are concerned from the operation of the customs tariff, they have not been exempted from the sales tax in their purchases of books and bindings. The operation of this sales tax, as I have indicated, constitutes a very grievious burden to public libraries. There is, as must be matter of common knowledge, an increasing demand on public libraries to-day, and it is also a fact that these institutions are receiving decreased appropriations. In the city from which I come we have a very efficient tax-supported public library officered by a very capable official indeed, a library which serves not only our city but a very large surrounding country. In the city of Calgary alone the operation of the sales tax during the present fiscal year will mean the payment by that library of about $1,000. During the year also there has been a decrease in the appropriations for this library totalling $2,000, In the western provinces the operation of the sales tax will mean
approximately $10,000 to public libraries, of which amount $7,000 represents the tax on the purchase of books alone.
I hold in my hand a letter from the Inspector of Libraries for the province of Ontario, and I should like to indicate his views in connection with this matter. Referring to the libraries in Ontario, he says:
Our libraries expended in that year $164,185.
That is, the year 1921. Continuing, he
says:
The sales tax is a heavy burden on our libraries. The prices of books have increased tremendously since before the war, and the libraries' incomes are decidedly limited. The Dominion government has always recognized the general public service of public libraries by permitting imported books to come to the public libraries free of duty. Surely the sales tax should be removed when it is in the general public's good that it should be removed. The Ontario legislature bases its grants largely on book purchases, and we find that our grants are not as effective by reason of the tax that is imposed ?
It is apparent, therefore, to anyone who ponders the situation for a moment that the tax-supported public libraries find themselves ground between the millstones of heavy federal taxation on the one hand and a decreasing appropriation on the other, the latter due primarily to the financial stringency. While the tax does bear very seriously upon the individual library, I think it can fairly be said that the aggregate amount received by the government, so far as the application of the tax to libraries is concerned, is very insignificant indeed.
The special objection which I have to the particular tax that I am referring to is that it constitutes a tax upon taxation. This is a case of double taxation, and falling as it does upon a tax supported institution, it bears very heavily indeed. Strange to relate, when the statute was drawn the provincial libraries were specially exempted, but other public libraries, equally tax-supported, were not favoured with exemption. Under these circumstances I am asking the House in the form of a resolution to indicate that this tax should be removed, in its application to public libraries in so far as it affects the purchase of books and of binding supplies.
I know that I shall be met with one or two arguments. It will be suggested. I doubt not, that the matter should first be taken up with the Finance Minister (Mr. Fielding) or the Minister of Customs and Excise (Mr. Bureau). But the library officials last year did take the matter up not only with the Minister of Finance but with the Minister of Customs and Excise, and they did not accomplish their desire. It will be urged, also, I assume, that to move an amendment when going into Coni-
Sales Tax
mittee of Supply constitutes a vote of want of confidence in the government. I have not any desire by this vote to indicate any such want of confidence so far as this particular item is concerned. I do want to suggest however, that there has not been any other opportunity to bring this matter to the attention of the House. Had I brought it up by way of private member's resolution I should have been met with the suggestion that it constituted in effect a subtraction of the public revenue and consequently would not be legal under that head. Bringing it up at this time, I may be met with the suggestion, as I have said, that it is a vote of want of confidence. Well, it is about time that hoary tradition was dispensed with; and I notice that in the Mother of Parliaments itself, the most transparent technicality has lately been taken advantage of in order to obviate the application of that rule. Then again, it may be urged, "Why not bring it up in the budget debate?" But if ever there was a time for pious platitudes, surely it is when the budget is under consideration, I do suggest to the government that this is the time and this is the place to bring to the attention of parliament a matter which to my mind is of vital significance to our public libraries and also to the reading public.
But I may be met further with the argument: "Why pick out this particular item? Why single out the sales tax in its application to public libraries? Why not deal with a dozen other things?" Well, I want to say at the outset that the tax in its effect upon libraries is particularly vicious, particularly harmful. It is, as I have pointed out, a tax upon taxation; it is in a category by itself so far as sales tax is concerned. And not only that: while I have very serious objection to the sales tax in many directions, I sometimes think it is much more desirable to attack the enemy in detail rather than by making a' frontal attack. I feel, that it is going to be a great many years before we shall have in vogue in ' this country a proper, scientific system of taxation. No effort has yet been made to delimit, if you like, the various fields of taxation-Dominion, provincial, and municipal. Consequently I must take this opportunity of presenting to the House a resolution dealing with this particular matter. I move in amendment:
That all the words in the resolution after the word "that" be struck out and the following substituted therefor:
Whereas public libraries are necessary and valuable educational institutions not existing for profit and supported by public taxation,
And whereas, on account of the increasing demand for library facilities and the difficult economic conditions prevailing, public libraries in Canada are experiencing the greatest difficulty in financing their reasonable requirements,
And whereas the application of the sales tax on the purchases of books and book-binding by public libraries constitutes a heavy financial burden, limiting the usefulness and impairing the efficiency of such public libraries,
Therefore be it resolved that this House deems it advisable that public libraries in Canada, supported by public taxation, be exempted from the operation of the sales tax in so far as the same affects the purchases of books and book-binding by such public libraries.
The amendment is seconded by the hon. member for McLeod (Mr. Coote).
