February 17, 1937 (18th Parliament, 2nd Session)

LIB

John Gordon Ross

Liberal

Mr. ROSS (Moose Jaw):

As I said the other day, the tariff in this country has greatly affected many of the provinces since confederation. Only a short time ago a commission in Nova Scotia made certain recommendations with regard to the tariff. They said:
We believe that the tariff policy of Canada has reacted unfavourably upon the economic development of Nova Scotia. It has tended to retard the growth of the exporting industries of the province without providing adequate compensation in other directions. It is true that, by means of the tariff and subventions, the central Canadian market has been brought within the reach of the coal mining industry, which would otherwise have been the monopoly of the United States industry; and that the steel and car construction industries have received a share of the orders for railway material and equipment from the Canadian railways; and that the dominion government has assisted in other ways. When, however, the advantages and disadvantages have been set against each other, we are definitely of the opinion that the fiscal policy pursued by successive governments has reacted injuriously upon the welfare of Nova Scotia.
We agree with the following statement quoted from the brief submitted by the then government of Nova Scotia to the royal commission on maritime claims in 1926;
"Protection, or free trade, or an exclusively revenue tariff, may be advocated with some show of logic, but surely no reasonable defence, no consideration based on equity or sound public policy, can be advanced in support of a system under which Nova Scotians are compelled to buy what they consume in a substantially protected home market, and to sell what they produce in a virtually unprotected one."
This applies not only to Nova Scotia but to the seven provinces outside the industrial area and to the majority of those people in

the two industrial provinces who are not engaged in industry. The tariff has given to certain people engaged in industry the power to tax other people, to such an extent that, in many cases, out of every dollar we have spent we have had to pay twenty-five cents for nothing. There are two or three aspects of the tariff which should be brought out. Until a few years ago it was always believed that the taxing power lay with this House of Commons. This has been the case in most British countries, but during the last two decades this taxing power has been gradually taken away from the House of Commons. In the first place, it has been turned over to the industrialists by means of the protective tariff. In the second place, certain provisions have been enacted which place this taxing power in the hands of the officials of the Department of National Revenue. When the budget is brought down, some hon. members may think they are making the tariff of this country, but that is not what is being done. There are some 1,200 items in the tariff schedule and about 120,000 different articles are imported into the country. The rate of duty charged depends upon the classification into which an article is placed. An article may come in under a duty of twenty per cent, but it will have to pay forty per cent if it is placed in another classification. The rate of duty depends upon what classification the officials of the customs department decide shall apply to a particular article.
The Department of National Revenue is located in Ottawa and anyone who has watched the operation of government, no matter what government may be in power, realizes that it is not difficult for those engaged in industry to come to Ottawa in an endeavour to obtain concessions in tariff rates or a more satisfactory classification for the articles they wish to import. The industrial areas are spread out around Ottawa and those engaged in industry are able to put considerable pressure upon the department. You will see these people coming to Ottawa and exerting every influence on the ministers of whatever government may be in power in order to obtain concessions. These people are able to place their views before those who administer the Customs Act, whereas the consumer as a whole has no chance to place himself in a similar position.
The result is that no matter what tariff schedule is brought down in the House of Commons, that is not the schedule under which goods are brought into the country. During the last several years higher and higher rates of duty -have been charged upon

Western Canada-Mr. Ross (Moose Jaw)
goods coming into Canada. Speaking on the suggested British North America Act changes the other day, I referred to the general effect of the tariff upon the country. I stated that the effect had been to centre the industrial areas in this part of Canada and thereby take away the. means of raising revenue from the outlying provinces.

Topic:   PROBLEMS OF WESTERN CANADA
Subtopic:   PROPOSED APPOINTMENT OF ROYAL COMMISSION TO STUDY AND REPORT ON ECONOMIC AND PSYCHOLOGICAL CONDITIONS
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