Colonial Despatches

I have the honor to forward for Your Lordship's information a copy of correspondence which has passed between Lord Lisgar and myself, partly by telegraph, respecting certain resolutions of the Legislative Council proposingmodifications modifications of the present British Columbian Tariff in lieu of the adoption of the Canadian Schedule of Duties upon the Union of this Colony with the Dominion.

2. By the terms of Union arranged with the Government of Canada it is agreed that the existing Tariff and Excise Duties of British Columbia shall continue in force until the proposedRailway Railway from the Pacific Coast and the system of Railways in Canada shall be connected, unless the Legislature of British Columbia should sooner decide to accept the Tariff and Excise Laws of Canada. If the alternative is strictly limited to this option, the decision of the majority will be in favor of the Canadian Tariff, which on most Articles of general consumption ismuch much lower than the scale of duties now collected here. I enclose for Your Lordship's information a Comparative Statement of the two Schedules.

3. A large and influential section of the Community and the Council, however, dread the effect of the Canadian Tariff and Excise Laws upon the Agricultural and Manufacturing interests of theColony Colony. The chief objection to that Tariff is the low scale of duties levied upon Cereals. Flour being admitted at a very low rate of duty it is alleged that the erection of Mills and the establishment and development of an important branch of Industry will be prevented; and that, in the absence of Mills, Wheat will not be grown.

4. The Excise Laws ofCanada Canada will it is feared bear hardly upon the Brewers who are at present exempt from any duty, in which case it is said a smaller quantity of Barley will be grown and thus both Brewers and Farmers would suffer.

5. The great difference in the rates of duty on Spirits in the two Tariffs is one main inducement to the advocates ofthe the Canadian scale to press for its adoption. It is sought therefore to effect a compromise, by which, certain alterations being made on specified Articles, the remainder of the present British Columbian Tariff may, at all events for the present, be retained, and with it our own Excise Law which only applies to Distilleries.

6. The Council accordinglypropose propose to the Canadian Government that the duty on Spirits shall be reduced to the Canadian rate, viz: Eighty cents, per Gallon; the duty on Flour to seventy-five cents per barrel; (present British Columbia rate One Dollar and Fifty Cents) and the duty on Wheat to Ten cents per bushel, (present British Columbia rate Thirty-five Centsper per hundred pounds). And that British Columbia shall enter the Union with her own Tariff so amended. The rates thus proposed are in no case lower than those which would be adopted in the Canadian Tariff so that Canada would suffer no pecuniary loss; and if British Columbia may at all be allowed to retain for a time a scale of duties different fromthat that prevailing in the Dominion, I do not see that the changes which are desired are objectionable in principle.

7. Supposing the Canadian Government to assent to this proposal time will not be afforded to make the alteration in the present Session of the Legislature of this Colony, which will be the last before Union;and and the Attorney General doubts the competency of that body to make any such alteration after assent to the terms of Union, having reference to the language of the agreement there embodied. But by consent of both parties concerned what is desired may be obtained. And it is submitted that if the Canadian Parliament assent to the proposal and such assent is embodied in their Address to the Queen, reciting the Resolution of the British Columbian Legislature to which assent is given, the arrangement may then be carried into effect by Order of the Queen in Council declaring the Union of this Province with the Dominion.

8. As I have stated in my Despatch to Lord Lisgar, MrTrutch Trutch, who has already proceeded on his way to Canada, has been instructed to afford all necessary information to the Canadian Government, and on his arrival in London he will be able to acquaint Your Lordship with the result of the negotiations upon this subject.

9. I have succeeded inseparating separating the acceptance of the terms, from any questions upon this matter. And in the event of the Government of Canada declining to meet the wishes of the Council, they are prepared to enter the Union with our own Tariff as it stands under the Agreement in the terms of the Address.