Exclusive power over customs, excise, and bounties.

90. On the imposition of uniform duties of customs the power of the Parliament to impose duties of customs and of excise, and to grant bounties on the production or export of goods, shall become exclusive381.

On the imposition of uniform duties of customs all laws of the several States imposing duties of customs or of excise, or offering bounties on the production or export of goods, shall cease to have effect382, but any grant of or agreement for any such bounty383 lawfully made by or under the authority of the Government of any State shall be taken to be good384 if made before the thirtieth day of June, one thousand eight hundred and ninety-eight, and not otherwise.

CANADA.—The customs and excise laws of each Province shall, subject to the provisions of this Act, continue in force until altered by the Parliament of Canada.—B.N.A. Act, 1867, sec. 122. UNITED STATES.—No State shall, without the consent of the Congress, lay any imposts or duties on imports or exports, except what may be absolutely necessary for executing its inspection laws.—Const., Art. I., sec. 10, sub-sec. 2.

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HISTORICAL NOTE—At the Sydney Convention, 1891, the clause as framed and passed was substantially to the same effect, except that the exclusive power over excise was limited to excise “upon goods for the time being the subject of customs duties;” and also that the particular provision as to “grants of or agreements for bounties” was not there. An amendment by Colonel Smith, to postpone intercolonial free-trade until “twelve months after” the imposition of uniform duties (with a view to prevent “loading up” (see Note, § 390, infra) was negatived. An amendment by Mr. Dibbs, to provide that the Victorian tariff should be the tariff of the Commonwealth until the Parliament should otherwise provide, was negatived. (Conv. Deb., Syd., 1891, pp. 789–801.)

Adelaide Session, 1897.—The 1891 draft was followed almost verbatim. On Sir George Turner's motion, the words “upon goods the subject of customs duties” were omitted.

Upon the clause dealing with the control of customs, &c., there was much debate on the subject of bounties. Sir George Turner wished to protect existing arrangements and existing contracts—and also future arrangements which might be made before the Bill became law. He also questioned the necessity of prohibiting State bounties on exports. Other members objected to future arrangements being protected, at least unless a definite near date was fixed. Everyone agreed that existing contracts ought to be protected; but Mr. McMillan, Mr. Symon, Mr. Reid, Mr. Barton, and others protested against any further exceptions to intercolonial free-trade. Mr. Deakin and Mr. Cockburn argued that bounties—especially on exports—did not necessarily interfere with internal free-trade, and ought to be allowed to the States subject to the constitutional restriction that trade shall be “absolutely free.” Mr. Trenwith suggested that State bounties should be allowed with the consent of the Federal Parliament. It seemed to be the general opinion that aids to gold-mining ought not to be prevented, though some members suggested that the clause was wide enough to cover them; and Mr. Barton suggested adding the words, “wares and merchandise” after “goods,” to narrow the meaning. Amendments were proposed to protect contracts “for the discovery of gold or minerals,” and also contracts entered into before 31st March, 1897 (the date of this debate being 19th April, 1897). The legal members thought that the clause in its then form would not invalidate contracts made before the commencement of the Act; and Mr. Isaacs proposed an amendment to place this beyond doubt. Mr. Grant and Dr. Cockburn submitted amendments to preserve bounties which did not interfere with freedom of trade. Finally all amendments were withdrawn and the clause passed provisionally. (See Hist. Note to sec. 91. Conv. Deb., Adel., pp. 835–66.)

Melbourne Session, 1898.—An amendment of the Legislative Assembly of Victoria was discussed, to omit mention of bounties. Sir Geo. Turner thought that the States ought to have power to grant bounties which were not unfederal—which he afterwards defined as “bounties for the promotion of agricultural, horticultural, viticultural, or dairying interests”—subject to such bounties being annulled at any time by the Federal Parliament. Mr. O'Connor objected that any State bounty interfered with equality of intercourse. Dr. Cockburn would limit the provision to bounties on exports, which he thought could not affect any other State; but Mr. McMillan replied that a bounty on export was practically an import duty. Mr. Deakin suggested a veto by the Federal Executive. Mr. Reid objected to all State bounties, saving existing obligations. Mr. Isaacs wanted State freedom in primary production, subject to the paramount rights of the Federal Parliament. Mr. Trenwith argued that State money could develop industries in many ways without injuring the federal principle. Mr. Higgins suggested the assent of the Inter-State Commission, as a compromise—Parliamentary assent involving too much delay. The Victorian amendment was negatived. The proposal of the Finance Committee, to except “any grant of or agreement for any such bounty made by or under the authority of the Government of any State before the 30th day of June, 1898,” was then carried. (Conv. Deb., Melb., pp. 909–64.)

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