CANADIAN TARIFF WAR

Sun (Auckland), Volume IV, Issue 1057, 22 August 1930, Page 1

CANADIAN TARIFF WAR

New Zealand’s Counter-Attack motor import duties raised Preference Now Abandoned THE SUN’S Parliamentary Reporter PARLIAMENT BUILDINGS, Thursday. IN direct retaliation to the increase in the duty on New I Zealand butter recently imposed by the Canadian Government the New Zealand Government has decided to place motor-vehicles and accessories imported from Canada on the general tariff list in force in April last, instead of on the British preferential tariff. A statement on the change, which implies an average increase of 25 per cent, in the tariff, was made by the Prime Minister, the Hon. G. W. Forbes, in the House of Representatives today.

“The Government has for some time been in communication with the Government of Canada concerning the trade rela'ions between the two countries," said the Prime Minister. “It will be remembered that in 1925 a trade agreement was made between Australia and Canada, under which certain reductions in duty were made on Comm rawealth products entering Canada. On October 1. 1925, the benefits of this agreement were extended to New Zealand goods. The principal reductions in duty were as follows: Fresh meats: Agreement rate, i cent a Id; British preferential tariff rate (in force prior to October 1, 1925), 2 cents a lb; cheese, free, 2 cents a lb; butter, 1 cent, 3 cents a lb. “The foi.owing figures of trade between Canada and New Zealand for the years 3923 to 1929 will show the effect of the alterations on the export trade of New Zealand to Canada:

STILL AGAINST NEW ZEALAND “It will be noticed, however, that notwithstanding the increase in the exports Irom this Dominion to Canada, the balance of trade was still considerably against New Zealand. The following are the exports of butter, cheese and fresh meats from New Zealand to Canada during 1924 and 1926-1929:

"It will be apparent that during 1929 butter formed over 80 per cent, of our total experts to Canada. As a matter o( fact, butter sent to that Dominion formed about 20 per cent, of the total exports of that commodity from New Zealand. Ever since New Zealand in 1903 adopted the system of preferential tariffs, the benefits of the lower duties have always been extended to Canadian products. It is estimated that the concessions in duty granted by -New Zealand to Canada are much freater than those made by Canada on New Zealand products, even with the ower rates provided for in the Ausagreement. In April last, the then Canadian government suggested that discussions should take place between the wo countries with a view to the nego*?n a direct trade agreement, tk , e , same time Canada informed us" Jr" Bfter the expiry of six months ® <*" e flts of the Australian agree- , opuld not be granted to our pro‘jj'fjt that it was willing to extend v sb P refer ential tariff rates to ‘ Zealand goods in return for the •»A» ed Brant of British preferential >wiir rates in force in New Zealand to Canadian goods. increase last may Can^ rtly „ after thls - ln M ay, 1930, the w»o.i lan Parliament passed an Act inasing th e British preferential tariff cent. oll bu tter to a minimum of four Dnri 8 Pound, which was the rate At tk the ge ? eral tariff in April last. Vm-o - Bame Bine countervailing duties 'tnposed on butter, fresh meats, of tk ° ats and Potatoes. The effect if tk.* 8 ?, coun tervailing duties is that adia? Ne Y Zealan d rate on the Canto* Soods concerned is higher than load. ana< ta on the New Zealand on , 6 higher rate can be charged Products if imported into comm! 06 ! Apr d last we have been in « i Cation wlth the Government >oce !? a itb a view to the mainteniiouns „ du ty of one cent a direct » n New Zealand butter until a and imli 3 agreement could be made Ihe n » D . I ? ei ? ted by legislation there, owinv s °t’ a tions have been delayed dons I Kl tbe Cana dian General Elecend nr i cb took place toward the la »t month. has „?“?* Canadian Administration eject th , orme d the Government in kalian at H cannot extend the Aus land nr!? eement ra tes to New Zoa that ti,. dUCts beyond October, but wi Hing to enter into font ThJ 1 ?, 4or a direct trade agreeruie aver. Government is as a general ‘“ion ,°m a policy of tariff retalidoter L P *?' ally with respect to a *Jiw matte? m °?’ but Uis felt that Z *aland ° f such m °irient to New ‘“dustrv a " d especially to the dairy taken. ’ cnat some action must be Tariff decided on therefore been decided that la * are vehic l es and accessortwin ln f~ be P^ ace< l on the general ? r ler-in.rv? rce , ln April last. An dotiea i ntf . u i lcil bringing the new day. p . t°rce will be gazetted tocreased r Dt pr °P° se d to apply the Dotted fcr„» at^ s to go °ds already exAction S k°!?A anada - as it is felt that ** little uld be taken so as to inflici *• PoasiHi ar d s hip and inconvenience Die on our own importers.

The Government is quite willing, pending the completion of a direct trade agreement, to replace Canadian motor vehicles on the British preferential tariff, provided that the Canad ian Government will similarly continue to grant to our products the rates fixed by the Australian-Canadian agreement. As I have already informed the House, I propose to discuss this matter with the Government of Canada when passing through that Dominion on my way to the Imperial Conference. The Leader of the Opposition, tlyj Rt. Hon. J. G. Coates: Has the Canadian Government been advised of this? The Prime Minister: Yes. We have been discussing this for some time, and informed Canada prior to the General Election there this this action was under consideration. Mr. R. Semple (Labour —Wellington East): Will this put Canadian cars on the same footing as American cars ? The Prime Minister: It will put the Canadian car on to the general tariff in operation before the recent additions were made. DETAILS OF CHANGES TYRES, BODIES AND CHASSIS THE SUN’S Parliamentary Reporter PARLIAMENT BLDGS., Thurs. An increase of 25 per cent, in the duty on Canadian motor-cars and accessories is the result of the decision of the Prime Minister, the Hon. G. W. Forbes, to place such vehicles on the general tariff instead of on the British preferential tariff. An Order-in-Council in the Gazette this evening makes the duty on chassis 35 per cent., as against 10 per cent, before, with an additional body duty where necessary of 15 per cent. Where the value for duty of any vehicle inclusive of the body, exceeds £2OO, the duty on the £2OO is 15 per cent, and on the remainder of the value 7£ per cent, ad valorem. The tyre duty Is increased to 35 per cent, and the duty on engines is increased to the same amount. “This means that the duty will be 35 per cent, on chassis and trucks, and 50 per cent, on a complete car if the value does not exceed £200,” said Dr. G. Craig, Comptroller of Customs, in a statement this evening. “In the case of a complete car over £2OO In value, the duty will be 50 per cent, on £2OO and 42£ per cent, on the balance.” Dr. Craig added that neither primage nor the new surtax would apply. Dr. Craig said that as far as the information in his possession showed, the present duty of 1 per cent, a lb. on Australian or New Zealand butter entering Canada would not be raised against Australian butter in October as would be done in the case of New Zealand butter, which was then to pay 4 cents. WELLINGTON APPEAL DEPUTATION . TO PRIME MINISTER x POSTPONEMENT WANTED THE SUN’S Parliamentary Reporter PARLIAMENT BLDGS., Today. A strong’ appeal for more consideration to motor-dealers regarding the new Canadian tariff proposals, was made to the Prime Minister, the Hon. G. W. Forbes, by a deputation of Wellington dealers today. The deputation was introduced by Mr. J. McCombs (Labour —Lyttelton). The motor-dealers understood the situation, Mr. Hope B. Gibbons said, but the announcement of the itfkw tariff had forced them to cancel all orders for Canadian cars. There were some Canadian commitments, however, that could not be diverted, chiefly because cars built for the New Zealand market were not suitable for Canadian requirements. He asked that these commitments be allowed to enter the country provided they were shipped by October 1, and said that importers were willing to furnish documentary evidence that the cars were already ordered and could not be diverted. Mr. Charles Todd supported Mr. Gibbons’s remarks, and said that the motor trade had been hit harder than any other trade by the Government’s taxation proposals. If the new Canadian tariff was operated it would mean that the Government would not get any income-tax from motor-deal-ers, and it would also cause more unemployment, because the dealers would have to reduce their staffs. England could not supply the Dominion’s demands because England was importing cars for her own market. In replying Mr. Forbes said that he realised that the imposition of the new duty would cause inconvenience to those importing Canadian cars, but it was felt that the action of Canada regarding New Zealand butter was upsetting the reciprocal arrangements between the two Dominions, and that the only way to get notice taken of New Zealand’s objection was by retaliation. He hoped that they would come to an agreement. (Continued on page 10.) j

Imports Exports Difference In favour Tear, from Canada. to Canada. of Canada £ £ £ '923 .. 2 950,984 656,299 2,294,685 1924 .. 3,914,404 705,324 3,209,080 1925 .. 3,916,237 413,536 3.502,701 1926 .. 3,431,533 850,362 2,581,171 1927 .. 2 739.826 1,652,067 1,087,759 1928 .. 3 258,828 2,455,337 803,491 1929 .. 4 792,820 3,342,299 1,450,521

Year. Butter. Cheese. Fresh Meats. 1924 £ £ £ 340,582 19,322 3,022 1926 230,562 Nil. 1,129 19*7 •» • • ., 899,727 4,495 8,948 1928 1,565,646 10,465 53,440 1929 2,707,669 13,606 36,197