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PARAGRAPHS 220-222-WRAPPER AND FILLER TOBACCO.

We submit that this was a wise provision, and not only simplified the enforcement of the law, but inflicted the minimum of harm upon the importer and manufacturer. Respectfully submitted.

A. L. CUESTA, Chairman.
Ed. WODISKA.
M. W. BERRIMAN.
ED J. STACKELBERG.

A. SANTA ELLA.
EXHIBIT A.

(Circular.)

DUTIABLE CLASSIFICATION OF LEAF TOBACCO.

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1893.

TREASURY DEPARTMENT, Department No. 158.

OFFICE OF THE SECRETARY, Division of Customs.

Washington, D. (., October 7, 1893. To Collectors and other Officers of the Customs:

In order to establish uniformity in the classification of tobacco imported at different ports, the following rules are hereby prescribed for the guidance of collectors of cusioms in applying the provisions of paragraph 242 of the tariff act:

The paragraph above cited provides that if any portion of any tobacco imported in any bale, box, or package, or in bulk shall be suitable for cigar wrappers, the entire quantity of tobacco contained in such bale, box, or package, or bulk shall be dutiable, if not stemmed, at $2 per pound; if stemmed, at $2.75 per pound.

A doubt has arisen at some of the ports as to the exact signification of the term “suitable for wrapper" as used in the paragraph referred to. As a matter of fact, it might be possible to apply some leaves in almost any package of tobacco to use as wrappers, and a literal interpretation of the language of the law might justify the exaction of the higher rates of duty upon most of the tobacco imported into this country,

It is hardly necessary to point out the inadmissibility of any interpretation which perverts and defeats the intention of Congress. The provision referred to is intended to prevent the willful admixture with filler tobacco of that which is meant for use as wrappers with the direct purpose of defrauding the revenue. The presence, therefore, in a package of filler tobaceo of any tobacco which, although capable of use as wrappers for inferior and cheap cigars, is not commercially recognized in the trade as wrapper tobacco, should not determine the classification of the whole package. It is only such tobacco, of whatsoever grade, as is commonly and commercially known as wrapper tobacco” which is referred to in paragraph 242 as “suitable for wrappers."

In Circular No. 124 the department instructed officers of customs that could not acquiesce in the establishment by the Board of General Appraisers of any maximum percentage of wrapper tobacco which would relieve the merchandise from classification as filler tobacco. The law does not establish any such definite limit, nor will it bear such a liberal construction; it provides that the inclusion of “any portion" of wrapper tobacco in a package of alleged filler tobacco shall subject the entire quantity contained in such package to classification at the higher rate. The discussions in Congress in regard to the provision just cited clearly show that its object was the frustation of all attempts at evasion of the duty by the intentional mingling of difierent classes in the same package. It would be manifestly, however, a strained construction of the law to classify the whole contents of a package as wrapper tobacco merely because of the incidental commingling of stray leaves of a quality or size suitable for possible use as wrappers. Such an interpretation would be prohibitive of all importations of filler tobacco, whereas the provision is to be administered not as an unreasonable and oppressive measure, but as a wise precaution against fraud. Unless tobacco, commercially recognized as wrapper tobacco, is designedly packed with filler tobacco in such a way as to render it difficult of detection it should not (unless in what would be commercially regarded as an appreciable quantity) interfere with the classification of the package as filler tobacco.

In the absence of any specific limitations to the word “portion” as used in the statute, collectors and appraising oflicers should be governed by the views above set forth, which, while rejecting the arbitrary line proposed by the Board of General Appraisers, allow a reasonable margin for such slight admixture of grades and qualities as may happen incidentally.

CHARLES S. HAMLIN, Acting Secretary.

PARAGRAPHS 220-222-WRAPPER AND FILLER TOBACCO.

TESTIMONY OF J. ALDUS HERR, PRESIDENT OF LANCASTER

COUNTY TOBACCO GROWERS' ASSOCIATION.

The witness was sworn by the chairman.
The CHAIRMAN. You will have 10 minutes, Mr. Herr.

Mr. HERR. Mr. Chairman, I have the following brief which I wish
to present to you in behalf of my constituents in Lancaster County,
Pa., who are interested in the tobacco subject:
Mr. Chairman and gentlemen of the Ways and Means Committee:

As chairman of the Lancaster County (Pa.) Tobacco Growers' Association, I, with my fellow members, appear before you in behalf of the growers of Pennsylvania tobacco. We are here to most emphatically protest against the proposed lowering of duty on any foreign tobacco used for cigar purposes.

We, to a unit, believe that a lowering of the present duty on Sumatra tobacco would be disastrous to the tobacco interests of our State, and equally as injurious to the interests of Connecticut, Massachusetts, New York, Ohio, and Wisconsin. A little more than a decade ago we were universally growers of wrapper tobacco. But the importing of Sumatra wrappers to our markets almost eliminated our production of wrapper leaf, at an enormous loss to the farming interests of the States aforementioned. This change of duty forced most of the growers in Pennsylvania from wrapper to binder and filler producers. This was the last field open to Pennsylvania growers of vobacco, and the result has not been as remunerative as it forinerly' was.

Now we as growers hear of another proposed lowering of the duty on foreign tobacco. If this reduction be effected, the great States of Pennsylvania and Ohio, more than any other, will receive the most disastrous blow that the tobacco growers have ever experienced. Would you ask us to cease growing tobacco, that has been one of the most staple crops for more than a half century? Would you have us embark in a line of farming less profitable and see our immense tobacco barns empty and unoccupied, at an immense depreciation of our farms?

The single county of Lancaster, Pa., grows 32,000 acres of tobacco, worth approximately $3,000,000, annually. The value of the land it is grown on is more than $2,000,000. The tobacco barns for housing this immense crop cost over $3,000,000, and the cost of labor to grow these 32,000 acres exceeds $1,500,000 annually. See the vast nu mber of people to which it gives employment nearly the entire year. Lancaster County, which is in the ninth internal revenue district, of which we are the chief, in the last 10 years paid to the Government in revenue approximately $25,000,000. This district is also the banner cigar manufacturing district in the United States. Is this industry not worthy of much consideration, and should it not be fostered to its best possible interests? We, as growers, most assuredly believe so. That is why we are sent here by our fellow farmers direct from our homes and farms, for farmers we aredirect from the fields of labor, to appear before you to enter our solemn protest in person against the lowering of the duty on all foreign tobacco used for cigar purposes. Is it possible that this Government would foster the interests of foreign countries in preference to its own? Would you gentlemen ask us as farmers to compete with the illiterate, half-clad, poorly paid laborers of Sumatra? I hardly believe that such can be your wishes. Therefore, give us the protection we ask, that we may continue to pay in the United States revenue the enormous sum we formerly have to help sustain our Government, our industries, and our homes.

Gentlemen, I submit the following resolutions for your careful consideration, hoping that the United States tobacco interests will receive the protection due this large industry:

We, the undersigned members of the executive committee of the Lancaster County (Pa.) Tobacco Growers' Association, in extra session on December 20, 1912, unanimously passed the following resolution:

Resolved, That we, as growers, are opposed to the lowering of the duty on any foreign tobacco used for cigar purposes, and earnestly request our Congressmen and United States Senators to exert all honorable means and influence to protect the tobaccogrowing interests of the United States."

(Send copy to Congressman and Senators.)

PARAGRAPHS 220--222-WRAPPER AND FILLER TOBACCO.

Lancaster County grows more tobacco (40,000,000 pounds) than any other county in the world.

These resolutions were unanimously adopted by the Lancaster County (Pa.) Tobacco Growers' Association in general session January 13, 1913.

J. ALDUS HERR, President.
John B. KENDIG.
Amos GILBERT.
ALDUS F. HERSH.
J. S. Wise.
H. S. RICHWINE.

Geo. HiBSHMAN, Secretary. Gentlemen, I hope you will give this your worthy consideration, for to us it has been one of the most stable crops in that part of the State.

Mr. Kirchin. What is the average price of your tobacco ?

Mr. HERR. The average price of the tobacco that we grow is about 9 or 10 cents a pound.

Mr. KITCHIN. And what is it used for?

Mr. HERR. For filler and for binder, and some portion of it for stogie wrapper.

Mr. Kitchen. Most of it is used in the manufacture of stogies, is it not?

Mr. IIERR. No; I should say not. I presume the greater portion of it is used for filler and binder.

Mr. Kitchen. Your county of Lancaster produces practically all the tobacco that is produced in Pennsylvania, does it not? It produces two or three times more than all the rest of the State together, doesn't it?

Mr. IIERR. Well, we produce quite a good deal.

Mr. Kirchin. Yes; you produce about three times more than the balance of the State. I just had an idea that most of that tobacco went into what we call stogies and cheroots. It is quite a heavy tobacco and will average 9 or 10 cents per pound. That is all.

Mr. SHACKLEFORD. The next witness is Mr. Correy.

TESTIMONY OF W. M. CORREY, OF QUINCY, FLA.

The witness was sworn by Mr. Shackleford.

Mr. CORREY. Mr. Chairman, I would like to ask that half of my time be given to Mr. J. L. McFarlin, of Florida. I can say what I have to say in five minutes.

I am the president of the Florida Leaf Tobacco Board of Trade, and I have a petition signed by over 800 growers in Florida and Georgia requesting that no change be made in the present tariff on tobacco. I shall simply file that with the clerk of the committee and not take up your time. In my section of the country we believe in a tariff for revenue.

We think that all luxuries are good subjects to produce that revenue. Tobacco is especially a good subject, and wrapper tobacco brought in last year over $11,000,000 of revenue. In our country we have developed a type of tobacco-and they have done the same thing in Connecticut-that comes in direct competition with imported Sumatra tobacco. But of our tobacco only about 20 per cent is of the highest grade, and it is that fine type that we produce that comes into competition with Sumatra tobacco.

PARAGRAPHS 220-222-WRAPPER AND FILLER TOBACCO.

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Now, the gentleman who has just testified is known as a millionaire tobacco exporter. He expresses great sympathy with the poor manufacturer in this country, but we claim that Florida, Georgia, and Alabama-and Alabama has now come to furnish a large amount of tobacco—that we can not successfully come into competition with imported Sumatra tobacco, and we respectfully ask that the present tariff on tobacco be continued. It produces a good revenue, and as Democrats we ask that it be continued.

Mr. LONGWORTH. You are not asking for protection?
Mr. CORREY. I am not at present; no, sir.

Mr. LONGWORTH. You are another of that class of gentlemen that come before this committee saying that you want an increase in the present duties or that you want them to be let alone for revenue purposes.

Mr. CORREY. Yes, sir.

Mr. LONGWORTH. You do not like the sound of the word "protection,” but you like to feel it.

Mr. CORREY. We feel that all luxuries should pay revenue, and tobacco and cigars are luxuries.

Mr. LONGWORTH. Are you asking this in behalf of the great common people of the United States, or are you asking it in behalf of yourselves?

Mr. CORREY. In behalf of ourselves, as well.
Mr. LONGWORTH. You want to be protected ?
Mr. CORREY. Yes, sir.

Mr. KITCHIN. About how much is the percentage of the homegrown production of these wrappers of the class that Florida, Connecticut, and Massachusetts manufacture?

Mr. CORREY. I should say we produce 10,000 bales of tobacco. Mr. KITCHIN. About 15,000,000 pounds ? Mr. CORREY. Approximately 15,000,000 pounds. Mr. KITCHIN. And about 6,000,000 are imported ? Mr. CORREY. About 6,000,000 pounds, yes; and it is the finest tobacco which comes into competition with the imported tobacco.

Mr. KITCHIN. Mr. Correy, you heard another gentleman testify a moment ago as to the cost of production of tobacco in Florida ?

Mr. CORREY. Yes, sir; and I take exception to his statement.

Mr. KITCHIN. I want to ask whether or not, in your opinion, his figures are correct?

Mr. Correr. No, sir. I have been in the tobacco-producing business for 25 years, and for the last 12 years the cost of tobacco of that type packed in bales, from year to year, will represent about 75 per cent per pound cost above his estimate, which was 60 cents. I have been growing tobacco for 25 years in Florida, and for the highest grade of our tobacco, which, as I say, is about 20 per cent, we get $1.75 and sometimes $2 per pound for that tobacco.

Mr. Kitchin. What is the average price of your tobacco ?

Mr. CORREY. Well, it varies with the season, it will be under $1 per pound, and in some years not over 75 cents for the whole crop.

Mr. KITCHIN. And his value based on $1 or $1.10 is rather high?
Mr. CORREY. Yes; I think he spoke of the imported value.
Mr. KITCHIN. No, he spoke of the domestic value.

78959_VOL 3-13- -23

PARAGRAPHS 220-222-WRAPPER AND FILLER TOBACCO. Mr. CORREY. It is away above our figures. I wish he was correct. I would now like to yield the

balance of my time to Mr. McFarlin. Mr. SHACKLEFORD. Mr. McFarlin, we will hear you next. .

TESTIMONY OF JOHN L. McFARLIN, OF QUINCY, FLA.

Mr. McFarlin was sworn by Mr. Shackleford.

Mr. McFarlin. Gentlemen, unfortunately in allotting the time I was allotted no time. I have drawn up some remarks which I think will interest you. I wish to file them, and if you will read them afterwards I think they will interest you very much.

Mr. SHACKLEFORD. I think they will all be read.

Mr. McFarlin. I think any information that you may desire as to the cost of raising tobacco in Florida, and as to the cost of making what we term artificial shade for the tobacco that comes into competition with the Sumatra tobacco—I can give you any information that you desire on that. Such tobacco has been experimented with by the Department of Agriculture of this Government as to the different kinds and production of tobacco, and their every idea is to produce in the United States a tobacco that we can substitute for the foreign product.

Mr. LONGWORTH. You are asking, if I understand you rightly, for a duty that will equalize the difference between the cost of production in Florida and the cost of the same tobacco grown abroad.

Mr. McFarlin. Yes, sir. The cost of labor in Sumatra used in producing that tobacco is only 10 or 15 cents a day, and we are paying from $1.25 to $2 a day.

Mr. LONGWORTH. In order that your industry shall exist you must protect yourselves against that form of labor ?

Mr. McFarlin. Which side shall I look to ?
Mr. LONGWORTH. I am with you.
Mr. McFarlin. I have been here before.
Mr. LONGWORTH. Well, you had better look over here.

Mr. FORDNEY. Was the cost of production given by the last gentleman-or in a former statement by another gentleman-correct?

Mr. McFarlin. I can give you the exact cost of production of Florida tobacco for a number of years.

Mr. Fordney. The average cost of production and the average price received ?

Mr. McFarlin. The finer grades of tobacco-that is, artificial shade, you understand--are bringing on the market $1.75 per pound, but there is only about 20 per cent of such tobacco raised. The lower grades are marketed at from 8 cents to $1 per pound. The strippers and fillers that we get are sold for 8 cents, and the medium grades about $1, and seconds anywhere from 35 to 40 or 50 cents.

Mr. FORDNEY. The average price of your whole production would be about what?

Mr. McFarlin. The average price possibly would be 85 or 90 cents, and the cost of production-I can't figure it out exactly-about 77} cents.

Mr. Hill. Will you kindly state about how many pounds of Florida shade grown is required to wrap 1,000 cigars?

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