Mr. B. W. FANSHER (East Lambton):
Mr. Speaker, I have listened with a great deal of interest to the speech of the hen. member for Weyburn (Mr. Young), and I was very much interested' in his last argument. But I wondered all the time how he would apply his reasoning to the present budget, the subject that is now under discussion, and my curiosity in that regard was not satisfied, because he sat down without giving us any idea of his opinion regarding the value of the budget.
The financial statement as presented this year is, from some aspects, very gratifying. The contribution through various forms of taxation of $450,000,000 to the public treasury by less than 10,000,000 citizens is a notable achievement. The contribution on an average of $45 for every man, woman and child, or $225 for every family of five, speaks well for the thrift and industry of the Canadian people. If we add to this amount the taxation levied by the provinces, counties, townships and municipalities, we commence to realize the huge amount that is annually provided to the different governments and taxing bodies by the Canadian citizens.
The Minister of Finance (Mr. Robb) this year, as has been his custom in years past in presenting his financial statement, has divided his tax receipts under three main divisions. In the first he includes those taxes derived from customs and excise duties; in the second, war revenues, and in the third, receipts from the postal department, interest on investments, money received through the administration of the Canada Grain Act, and various other miscellaneous receipts. He estimates that by the end of the present month, which is the end of the fiscal year 1928-29, he will have collected in taxes from the first group, $248,400,000, made up as follows:
Customs import duties.. .. $185,000,000
Excise duties 63,400,000
[Mr. E. J, Young.l
Under the heading of war revenue he estimates that the amount that will be collected will be as follows:
Sales tax and stamp taxes.. $ 81,500,000
Income tax 58,500,000
Delayed business profits tax.. 450,000
In the third group he expects to receive the following:
Interest on investments.. .. $11,600,000
Post office 31,000,000
Dominion lands 4,000,000
Canada Grain Act 3,000,000
Miscellaneous receipts 9,350,000
This makes up the grand total of taxation this year of $450,000,000. Not until our entrance into the Great war were any of the taxes enumerated in the second group imposed; all our taxes were derived from the sources mentioned in the first and third divisions. Since our entrance into the war large sums of money have been levied through war taxes, but never during any single year have receipts from war taxes been sufficient to meet annual war expenditures. There has always been a deficit. Year by year the minister has given us a statement of the actual receipts from these war taxes, but never in any year with the exception of one-and I believe that was the fiscal year ended March 31, 1925 -has he given us a statement of the actual annual expenditures on war account. That year he showed that receipts from war taxes amounted to $147,000,000 and expenditures to $167,000,000, or a deficit of $20,000,000. This year the minister estimates that receipts from war taxes will amount to $142,650,000 and expenditures to $162,911,000, leaving a deficit of more than $20,000,000. This deficit on war account becomes a direct charge on other forms of taxation, and as long as we have deficits on war account, it seems strange to me that reductions in taxes from year to year should be simply in connection with war taxes. It is my firm belief that war taxes should be sufficient to meet annual war expenditures, and I would go further than that and say that war taxes should be sufficient to meet the annual charges on war account consisting of interest on war debt, pensions, soldiers' civil re-establishment, and so forth, and also to provide whatever sum is paid annually upon our war debt. If that were the case, this year we would have to raise under the heading of war taxes $20,000,000 more to meet our annual war expenditures, and another $70,000,000, the amount applied on war
The Budget-Mr. Fansher (Lambton)
debt, or a total of $90,000,000. That $90,000,000 has to be taken from other sources of revenue, and it simply means that out of the $248,000,000 provided by customs tariff and excise duties we have to take $90,000,000 to meet our expenditures on war account, and to make our annual reduction in war debt.
As I said a moment ago, to my mind war taxes should meet war expenditures. In 1927 and 1928 we had large reductions in the income tax, the sales tax has been reduced year by year, and in no financial statement that has been presented have we ever received sufficient revenues to meet war account. The income tax should be put back where it was before 1927. The sales tax is being continually reduced and it is one of the most direct means of raising revenue with the least expense. It often appears curious to me why we should be persistently reducing the income tax and the sales tax, while the customs tariff, the tax that the Liberal party specified they would reduce, has not received any material reductions during the life of this parliament. If the reduction in war taxes goes on each year, we will soon be faced with the fact that we shall have to take half the revenue derived from customs and excise duties to meet our deficit on war account. And then we shall soon begin to realize what Sir Thomas White meant when he said that the war debt, if it was paid, would be paid out of the top six inches of Canadian soil. If our war expenditures and the reduction of our war debt is to be paid through the customs tariff, we can readily see that the financial burden of the war is going to be placed on the shoulders of the people on the soil, because those on the soil bear most of the tariff burden.
The Minister of Finance says that the policy of this administration is not a high tariff policy, but a low tariff policy. But having said that, he at once proceeds to lower those forms of taxation which do not bear upon the tariff at all, and he leaves the tariff practically untouched. As far as this budget is concerned, it seems to be somewhat of a watchful waiting affair-watching to see what the United States will do at the next session of congress in regard to raising the tariff, and waiting to see how much political capital the Conservative party might make out of such a step if it were taken. To a certain degree I am somewhat in sympathy with this watchful waiting policy. If the government of the day ever had an excuse for not giving tariff reductions, perhaps it has a better one at this session of the house than it has ever had before during the term of this parliament. There are fields in which
the Minister of Finance could, I believe, have implemented some of the promises given in the Liberal platfoi'm of 1919, and one of these I believe to be the lowering of the duty against British goods. Although it might be advantageous to adopt a watchful waiting policy this session as regards the United States. I see no reason why it should not be to our advantage to lower the duty against British goods. Then, too, the policy espoused by the United States is to be directed largely, we understand, against agricultural products. There is therefore a large number of commodities with which they would not concern themselves, and I can see no reason why we should not proceed to give tariff reductions upon some of those commodities upon which the tariff board has already passed. It may be that the government has let the opportune time slip by for giving substantial reductions. I notice that some members on the government side of the house seem to entertain that view, judging by what they have said in this debate. They seem to be fearful that the golden opportunity has passed by. I quote from the speech made by the hon. member for South Huron (Mr. McMillan). Speaking in this debate, he said:
I urge upon this government that its duty is to proceed more rapidly along the lines of a well-considered tariff reduction. I urge them again that we can do this kind of thing only in periods of good times. We cannot do it in times of adversity. Now is the golden opportunity. and we should be taking advantage of it. Apparently, however, the government seem inclined to mark time.
The hon. member for South Huron is evidently getting anxious and somewhat fearful lest we have no tariff reductions this year. He almost seems to think that the government has sinned away its day of grace so far as tariff reductions during the life of this parliament are concerned. I notice also in the speech of the hon. member for Lis-gar (Mir. Brown) a somewhat similar sentiment. He has this to say:
From the standpoint of the ordinary consumer I confess that there is not a very great deal in this budget; it does not contain much meat, of course, but we may be glad that it does not contain any poison.
The hon. member has evidently given up all idea of getting any meat from any of the budgets presented by the Minister of Finance, and is now wiling to be thankful if only no poison is adtainistered. I hope that the hon. Minister of Finance will bear in mind these expressions of his supporters when he prepares his next budget.
The Budget-Mr. Fansher (Lnmbton)
I wish to deal for a few minutes with some of the commodities that were considered by the tariff advisory board: It is a well-known fact that the Liberal platform of 1919 enumerates a large number of commodities which they proposed placing on the free list. After enumerating those commodities, of which cement was one, the resolution concludes with this sentence:
The Liberal party hereby pledges itself to implement by legislation the provisions of this resolution when returned to power.
The tariff board has investigated the duty on cement, and anyone who reads the evidence which was taken in that case must come to the conclusion that the manufacturers of cement are not entitled to tariff protection. I find that during the last year for which I can get complete returns, there was imported into this country 73,652 hundredweight of cement, on which there was a duty collected of $5,875, or eight cents per hundredweight. There was manufactured1 in Canada, 35,230,527 hundredweight. There was exported 900,000 hundredweight, which left to be consumed in Canada, 34,330,527 hundredweight. Now it can be readily seen that with a duty of 8 cents per hundredweight, the protection furnished on the amount consumed in the home market amounted to $2,746,442. Putting it in another way, that amount of protection is provided, for while the government obtains one dollar in revenue, it provides for the industry, $467, or in the ratio of $1 for the treasury and $467 for the industry. In the light of those figures I can see no reason why we should not 'have had cement placed on the free list in this budget.
Sewing machines have also been investigated by the tariff board. The number of sewing machines imported during the last year for which complete returns are available was 19,929, valued at $593,657, or at an average price of $30 per machine. The duty collected was $161,953, or an average duty of $8.12 on each sewing machine. The Bureau of Statistics inform me that only one company manufactures this machine in Canada, and hence they could not furnish me figures giving the number off machines manufactured. But they did give me the value of those exported, namely, $3,464,098. Reckoning each machine at a value of thirty dollars, we find that 1,135,469 machines were exported.
I may say that I have selected some of these articles because they are in general use, and
the following tabulations will, I believe, be of interest to the house:
Stoves, coal, wood and oil
Imports $ 506,410
Duty collected 126,382
Total manufactured in Canada. 5,675,202
Used in Canada 5,560,720
Protection afforded 1,390,180
Ratio 1 to 11
That is, for every dollar received by the treasury eleven dollars was provided the protected manufacturers.
Furniture is very necessary to the settler, and in fact to every citizen. What do I find in regard to furniture manufactured entirely from wood? These are the figures:
Imported into Canada $ 2,271,777
Duty collected thereon 634,980
Percentage of duty 28
Manufactured in Canada.. .. 35,733,818
Used in Canada 35,437,040
For every hundred dollars' worth of furniture imported twenty-eight dollars was collected in duty. It is obvious that every time a hundred dollars' worth of furniture is manufactured in Canada there is provided by way of protection to our furniture manufacturers an equal percentage, amounting to $9,922,371. The ratio between the treasury and the manufacturer is 1 to 15.7.
Now let me give some figures with regard to enamelware. The conditions surrounding the manufacture and sale of this commodity have been examined by t'he tariff board, and anyone who reads their report can come to no other conclusion, it seems to me, than that the
tariff duty should be reduced. Here are the figures:
Imported $ 314,369
Duty collected 100,778
Total manufactured in Canada. 2,171,384
Used in Canada 2,138,502
Protection afforded 684,320
Ratio 1 to 6.8
I have similar figures relating to cutlery most of which we import.
Duty collected 341,265
Total manufactured in Canada. 693,100
Used in Canada 692,042
Protection afforded 169,443
We collected 24.34 per cent on a million and a third dollars' worth of these imported goods in order to protect less than naif of that amount manufactured at home.
The Budget-Mr. Fansher (Lambton)
Now, the total duties collected on these five commodities, leaving out sewing machines, amounted to $1,209,280, and the protection provided represented $14,912,756, or a ratio of 1 to 12. Why do I mention these commodities? Largely because they are required by the immigrant and by the settler, and it seems to me that the protection afforded has a direct bearing upon our immigration problem. For years past this government and its predecessors have in their efforts to attract settlers given assisted passages to intending immigrants from the old country and in some cases provided what may be termed readymade farms. We have gone to this expense to bring in immigrants, but we have failed to tell them that when they proceed to furnish their homes with these necessary commodities, no matter whether they buy imported goods or goods made at home, they will be taxed at the high rates that these figures disclose. It seems to me that as a complement to our immigration policy it would 'be advisable to place these commodities on the free list or as nearly so as possible and thereby reduce the purchase price to the intending settler.
We have heard a good deal in this house about prosperity. Some say we have it, some say we have it not; some want to know what it is and others, where it is. It depends a good deal on whom you ask as to what answer you will receive. If you ask the
banker, he will say yes; ask the broker, he also will say yes, we have prosperity; ask the manufacturer and he will say the same thing. But ask the farmer and he will invariably say, no. I am glad to notice that in this house there has been somewhat of a change in attitude towards the farmer and farmers' rights. I well remember that during the fourteenth parliament the members in this section of the house were termed calamity howlers because they persisted in pointing out the plight agriculture was in. Some were termed the Jeremiahs from the west. But I observe that to-day large numbers in all parties in the house are agreed that the farmer is not enjoying that degree of prosperity Which he should. On that, most of the members of the house are agreed. And with that idea in mind I turned to the census report, secured from the Bureau of Statistics, and published after the enumeration of 1921. I went over the figures given for the ridings of nearly the whole province of Ontario, taking all that portion lying south of Muskoka, Victoria county and Renfrew-what is known as old Ontario. In that area I find 385 townships, scarcely a single one of which has not witnessed a decline in population. The following table, which gives the figures from 1901 to 1921, will show the decline that has taken place., with increases in a few instances.
Bruce South.. i. .
Grey Southeast.. .
Hastings East. - .. Hastings West.. .. Huron North.. .. Huron South. . ..
Lambton East.. .. Lambton West.. ..
Middlesex East.. . Midlesex West.. ..
Number of townships
8 6 6 6
8 8 8
14 10 14
Loss in population 1901-1921 950 7,131 7,605 3,268 5,050 3,975 3,425 909 3,999 1,977 1,418 4.138 3,071 3,321 6,860 10,743 2,651
3.990 6,507 5,791 3,905
6.017 5.171 4,519 4,675
Gain in population 1901-1921
The Budget-Mr. Fansher (Lambton)
Peterborough East.. Peterborough West..
Prince Edward. . ..
Waterloo North.. .. Waterloo South.. ..
Wellington North.. Wellington South.. .
Number of townships
6 9 7 7
7 6 5
6 3 3
8 G 6 8 5
Loss in population 1901-1921 4,342 4,816 2,068
Gain in population 1901-1921
385 177,744 27,311
It will be seen that the total decrease in that twenty-year period is 177,744, while the increases in a few townships total 27,311. But those increases are due entirely to the overflow from cities like Hamilton, which have extended into the townships.
Topic: THE BUDGET
Subtopic: CONTINUATION OF DEBATE ON THE ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE