June 4, 1954

CCF
LIB

James Joseph McCann (Minister of National Revenue)

Liberal

Mr. McCann:

With reference to the other matter brought up by the hon. member for Greenwood, this of course has reference to the change that was made in December last, in this session, in the Customs Act whereby the valuation for duty purposes was changed. Subsection 6 was added to section 35 of the act, which attempted to deal with a particular problem that presented itself at that time, and probably to a certain extent continues to come before us and will continue to come before us for some time. The amendment at that time was to this effect:

(6) Notwithstanding anything in this act, where the market price of any manufactured goods in the country of export-

I would draw the committee's attention particularly to that last sentence. It continues:

-has. as the result of the advance of the season or the marketing period, declined to levels that do not reflect in the opinion of the minister their normal price, the value for duty shall be the amount determined and declared by the minister

to be the average price, weighted as to quantity, at which the like or similar goods were sold for consumption in the country of export during a reasonable period, not exceeding six months, immediately preceding the date of shipment of the goods to Canada.

I think I should perhaps read the rest of the instructions which were given to our officers in an attempt to carry out this provision of the act:

To give effect to the purpose of this amendment, collectors, appraisers, and any officer acting as appraiser, are instructed to closely scrutinize the invoice values of all manufactured goods, comparing such values with home market values shown and certified on previous importations of similar goods by the same or other importer. In any case where invoice values indicate price decline, such as is contemplated by the foregoing valuation provision, or the values appear abnormally low, the importer is to be advised that the entry may be subject to amendment in accordance therewith. The invoice is to be forwarded to the department with as full information as possible and the reasons for believing that the value shown is below the normal value, in order that the matter may be inquired into and the value for duty established as provided for by the new subsection of section 35.

This instruction was also issued to our collectors:

For the purpose of administration of section 35(6) of the Customs Act, referred to on page 1-44 of the book of instructions to port officers-

We send out instructions to all port officers as to how they are to carry out the law.

-importers are to be instructed to advise their suppliers that customs invoices covering manufactured goods of the type contemplated by this section will require to show, in addition to the usual fair market value and selling price data, the highest price at which like or similar goods were sold and delivered for home consumption during the six months immediately preceding the date of shipment to Canada. Typical of the goods which might be affected by this section are style fabrics, dresses, textiles, shoes and purses; refrigerators; automobiles. This list is illustrative only and is by no means exhaustive; and officers should use their own judgment in determining whether other goods are affected at their individual ports.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell:

What was the date of

that report?

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LIB

James Joseph McCann (Minister of National Revenue)

Liberal

Mr. McCann:

These were the instructions given outlining the method by which we attempted to put this section of the act into effect.

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PC
LIB

James Joseph McCann (Minister of National Revenue)

Liberal

Mr. McCann:

One was dated February 26, 1954, and the other, issued on December 7, 1953, was issued just after the act was amended.

That will give hon. members some understanding of the action that has been taken by the department to implement this amendment to the act. I am sure we are all interested in the results of that action. While we 83276-3481

Supply-National Revenue can give some definite result, I would suggest to the committee that it is impossible for anyone to determine to what extent importers have been deterred from making importations into Canada of those goods so affected because of the fact that they would not know at that time just what the amount of the invoice would be. Therefore, I cannot say to what extent this has affected importations. I simply do not know, and I suggest it is hard for anyone to make an accurate estimate.

However, the method we have followed is to send appraisers to other countries which were disposed to export end of the line or end of season goods to this country, and appraisals are made of the prices and of the range of prices for six months previous to the time of export.

Our figures in that connection show that the average weighted price over the period has not been far off the initial price at which that type of goods has, in the first instance, been sold to the people in the country where they were manufactured, and that if exported to this country it closely approximated the price in the first instance.

That applies to a variety of goods and we have a wide quantity with reference to printed piece goods; model 82 refrigerators; model L3 refrigerators; model 105 refrigerators; embossed cotton piece goods; again, refrigerators of different types; more cotton piece goods, which include a long list now under investigation. That list includes drapery fabrics, drapes, shirting, denims, corduroy, synthetic piece goods, cotton piece goods, upholstery, floor coverings, plush fabrics, and here I am giving only a partial list to indicate the cases which are still under investigation and have not yet been included.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell:

Could the minister give us the values involved, roughly?

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LIB

James Joseph McCann (Minister of National Revenue)

Liberal

Mr. McCann:

Yes, I could give the values in some of these instances. For example, and going back over the imports, clothing and wearing apparel made from woven fabrics, women's and children's dresses made wholly from cotton, and giving the number of pieces, in the month of January 1953, there were 45,330 pieces valued at $107,000-

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell:

Would the minister permit a question? What I am trying to get at is the amount involved in the report which you have received and which, as I understand it, you are now investigating. I want to know whether we can fully assess the material results of the act.

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LIB

James Joseph McCann (Minister of National Revenue)

Liberal

Mr. McCann:

Do you wish to have the total amount in a definite period?

5500 HOUSE OF

Supply-National Revenue

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. Macdonnell:

Yes, I think that would show-

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CCF

Alexander Malcolm Nicholson

Co-operative Commonwealth Federation (C.C.F.)

Mr. Nicholson:

Mr. Chairman, on a point of order. I cannot hear too well down here in this corner, but my understanding was that this first item was to be allowed to stand. Could we have an explanation as to whether a decision was made in that regard? I do not see any point in proceeding with this discussion if the item is to be allowed to stand.

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LIB

William Alfred Robinson (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

The Chairman:

As I understand it, there was an agreement reached to the effect that the items be subject to question and answer and that the general discussion would take place on a later item.

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CCF

Alexander Malcolm Nicholson

Co-operative Commonwealth Federation (C.C.F.)

Mr. Nicholson:

Well, Mr. Chairman, if we are not going to carry the item at this stage, I do not see any point in continuing with this discussion. We hear a good deal about extravagance and waste, and it was announced last night that we would be going ahead at eleven o'clock. The officials who are here today are men who have a very pressing responsibility and I do not think it is fair to have them here over a long discussion. I wonder if that matter could be cleared up.

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LIB

William Alfred Robinson (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Liberal

The Chairman:

My understanding is that the item will be carried when the questioning is completed, but that the general discussion which would ordinarily take place on this item will be deferred. I think perhaps one thing which might conveniently be resolved at this time is the item on which a general discussion will take place. I should think hon. members would wish to know with some certainty when the general discussion will take place.

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CCF

Alexander Malcolm Nicholson

Co-operative Commonwealth Federation (C.C.F.)

Mr. Nicholson:

As long as there is an understanding that we are not going to spend the whole morning or the day and then have this item stand, and as long as we know whether we are to have the discussion on the first item or not, I will be satisfied. Will the leader of the house indicate what the decision was? Is this item to stand after we have spent some time on it or is it to carry after we are through discussing it?

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LIB

Walter Edward Harris (Minister of Citizenship and Immigration; Leader of the Government in the House of Commons; Liberal Party House Leader)

Liberal

Mr. Harris:

My understanding was that we would proceed with the questions and answers so that information could be obtained, and that if hon. members then chose to have an extended general debate on customs, it could be deferred. It does not really matter what item is used for the general discussion. I would give the assurance there could be one. But I took it that rather than having at the moment extended speeches of

[Mr. McCann.1

a general nature with respect to customs matters, an effort would be made to ascertain, with the officials present, information which could perhaps be the basis of a later general discussion.

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PC

George Alexander Drew (Leader of the Official Opposition)

Progressive Conservative

Mr. Drew:

There is one feature of this situation that I think has been causing a great deal of concern to many of the members of the House of Commons, and not only to those on this side of the chamber. As has already been pointed out by the hon. member for Greenwood, the question of the level of the tariff is not at the moment in any way at issue in this discussion. Unfortunately there are those who seek to confuse the public mind-and I regret to say that they do so deliberately-by the suggestion that any comments about the appropriate application of anti-dumping legislation is an expression of a high-tariff policy.

Let us in the first place recognize the fact that this government has continued the policy of tariffs-and in some cases substantial tariffs-but that the question of tariffs is not the one before us. This party has indicated its belief in Canada's ability to proceed as effectively and as efficiently, with a proper level of taxation, as any people can under comparable conditions. We are dealing now with something quite different from the long-debated question of high or low tariff, a subject which has not been before us for discussion in the present session or in recent sessions.

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?

An hon. Member:

Question.

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PC

George Alexander Drew (Leader of the Official Opposition)

Progressive Conservative

Mr. Drew:

Mr. Chairman, I just heard an impatient interjection of "question" by someone who is not anxious to listen to any discussion of business now before this committee.

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June 4, 1954