PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

is only made possible by reason of their peculiar efficiency for certain purposes, whereby the customer is willing to pay a relatively higher price for them, or by reason of the fact that they can be shipped in tank cars at a minimum of expense for handling, freight, etc.

We can not too strongly urge you to impress the Tariff Committee with the fact that American manufacturers of quebracho are to-day in a most hazardous position on this tariff matter, and that any reduction whatever in the duty will be a most serious matter for this business, which although not large by itself, yet as a branch of the tanning extract industry, certainly demands proper consideration.

Mr. Vogel says nothing about the fact that even though the duty on solid quebracho extract in the Payne bill was by reason of its greater strength readjusted to differentiate it from the liquid, the price of solid extract which at that time was 43 to 44 cents per pound has in the meantime dropped to 3 to 4 cents per pound. This drop in price has been caused by competition of foreign makers of quebracho, whose consistant aim, as you know, has been to force American manufacturers out of business, and who apparently have been able under present conditions of prices and tariff to sell their goods here at a profit. The present duty to-day barely gives us a fighting chance in continuing the manufacture of quebracho extracts in this country, and any reduction in same would surely force us to give up the business.

Yours, very truly,

PARAGRAPH 21.

NEW YORK TANNING EXTRACT Co.,
J. STEVENS, Vice President and Treasurer.

Ethers: Sulphuric, eight cents per pound; spirits of nitrous ether, twenty cents per pound; fruit ethers, oils, or essences, one dollar per pound; ethers of all kinds not specially provided for in this section, fifty cents per pound; ethyl chloride, thirty per centum ad valorem: Provided, That no article of this paragraph shall pay a less rate of duty than twenty-five per centum ad valorem.

For sulphuric ethers, see also Mallinckrodt Chemical Works et al, page. 49

PARAGRAPH 22.

Extracts and decoctions of logwood and other dyewoods, and extracts of bark, such as are commonly used for dyeing or tanning, not specially provided for in this section, seven-eighths of one cent per pound; extract of nutgalls, aqueous, one-fourth of one cent per pound and ten per centum ad valorem; extract of Persian berries, twenty per centum ad valorem; chlorophyll, twenty per centum ad valorem; extracts of quebracho, not exceeding in density twenty-eight degrees Baumé, one-half of one cent per pound; exceeding in density twenty-eight degrees Baumé, three-fourths of one cent per pound; extracts of hemlock bark, one-half of one cent per pound; extracts of sumac, and of woods other than dyewoods, not specially provided for in this section, five-eighths of one cent per pound; all extracts of vegetable origin suitable for dyeing, coloring, staining, or tanning, not containing alcohol and not medicinal, and not specially provided for in this section, fifteen per centum ad valorem.

For nutgall extract, see also F. Bredt & Co., page 54; for tanning extracts, see also W. W. Skiddy, page .172

DYEING OR TANNING EXTRACTS.

STATEMENT OF AUGUST VOGEL, OF MILWAUKEE, WIS., REPRESENTING THE NATIONAL ASSOCIATION OF TANNERS.

Mr. VOGEL. Mr. Chairman, I desire to have a correction made in the calendar. I am not interested in brewers' malt, in spite of the fact that I come from Milwaukee. I suppose the word "Milwaukee" was sufficient to carry the beer sign with it, but I desire to correct that, and also that it is not "tunners," tunners," but the tanners who are

PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

appearing before you. With your permission, Mr. Chairman, I would like to read the brief of the tanners in reference to this schedule.

The CHAIRMAN. The committee has allowed you 15 minutes without interruption. Of course after that the committee may crossexamine you. You may dispose of the 15 minutes to suit yourself.

Mr. Vogel read the brief referred to, as follows:

On behalf of the National Association of Tanners, and representing a majority of the tanning interests of this country, we respectfully ask the attention of your honorable committee to the items enumerated below, which appear under Schedule A of the Payne Tariff Act.

The above equal an average ad valorem duty of about 29 per cent. Our recommendation in reference to these items (all of which enter into the tanning of leather) is that the rates indicated in H. R. 20182, introduced in the last session of Congress, be used in the readjustment of duties on said items, except that on tanning extracts other than chestnut and quebracho we suggest one-eighth cent per pound-all providing that there is to be no important change made in the present low duties on leather. The reduction of duty on belting, sole, and rough leather from 20 per cent in the Dingley Act to 5 per cent in the Payne Act, a reduction of 75 per cent, has already resulted in a marked increase in importations of such leathers, as illustrated in table below.

PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

Importations of belting, sole, and rough leather, duty 5 per cent (record incomplete prior

to December, 1911).

Referring to the items of tanning extracts, which are the most important items to our industry of those listed above, we argue for the reduction of these duties on the broad ground that the duties are unreasonably high.

The approximate cost of producing liquid chestnut extract in this country is 1 cent per pound and of solid chestnut extract 24 cents per pound. A duty of three-eighths cent per pound, as recommended above, equals 37.5 per cent of the cost of liquid chestnut extract and 13.6 per cent for the solid. The present duty on chestnut extract of five-eighths cent per pound equals 62.5 per cent of the cost of the liquid extract and 22.5 per cent for the solid. These duties seem to us manifestly too high, especially in view of the low rates of duties (5 and 7 per cent) on the various kinds of leather in which these extracts are used.

The imports of quebracho extract into the United States has varied from seventyfive to one hundred million pounds per year during the past three years. This importation has produced a revenue for the Government of over $500,000 annually, but has failed to materially increase the production of quebracho extract in the United States, which is limited to two plants. It is, therefore, our opinion that no duty should be placed on quebracho, except as may be found necessary for revenue purposes.

We would call to your attention the importance of this matter of tanning extracts to the leather industry, by submitting herewith a table showing the relation of the value of tanning extracts to the value of the leather tanned with that extract.

This table is based upon two well-known classes of sole leather, namely, packer slaughter leather and dry hide leather, which leathers are those principally used in the manufacture of low and medium priced shoes. You will note from this table that the value of the tanning extract in a pound of leather varies from 13 to 29.2 per cent of the value of the leather in the different grades enumerated. In fact, the duty on the extract at three-fourths of a cent a pound equals the entire duty on a pound of the lowest grade leather mentioned (dry hide scabs). Approximately, it takes about 1 pound of solid extract to tan 1 pound of leather.

PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

Quebracho extract is used in combination with domestic chestnut extract to produce the proper color in the leather. Lower duties on foreign extracts will tend to increase the use of chestnut extract, and this will conserve our hemlock and our oak bark supplies.

We would also call to your attention that our principal competitor is the Canadian tanner, who pays no duty on tanning extracts. He has cheaper bark and labor as low or lower than ours. In spite of the competition of free quebracho and other tanning extracts in Canada, American extract manufacturers are regularly shipping quebracho and chestnut extract from the United States to Canada, demonstrating that these American extract manufacturers can compete even with free foreign extract. Respectfully submitted.

THE NATIONAL ASSOCIATION OF TANNERS' TARIFF COMMITTEE.
AUGUST VOGEL, Chairman.

The CHAIRMAN. Do you desire to say anything further?

Mr. VOGEL. I have nothing to say, unless questions should come from the other side.

Mr. HILL. I would like to ask a question with reference to quebracho. Do you think the duties provided in this bill should remain in reference to the extract of quebracho?

Mr. VOGEL. No, sir. I recommend that it be reduced from threefourths to three-eighths of a cent.

Mr. HILL. I mean the duties on the raw material?

Mr. VOGEL. On the raw material? I do not quite get your question. Mr. HILL. Do you think there should be a 10 per cent duty on what has always been free, as the raw material of the industry of making extract of quebracho, solely for the sake of getting revenue? Mr. VOGEL. The duty is at present three-fourths of a cent a pound on quebracho.

Mr. HILL. I understand that, but I am talking about the log from which it is made.

Mr. VOGEL. The log will remain free.

Mr. HILL. It does not remain free under this bill, if it is peeled, and it can not be brought here any other way. There is a duty of 10 per cent on it.

Mr. VOGEL. I am not prepared to argue that point.

Mr. HILL. That is a very vital point, is it not, to the manufacturer of quebracho?

Mr. VOGEL. It is, no doubt.

Mr. HILL. Is it possible to make a cut of 50 per cent in the duty on the extract and add 10 per cent to the raw material and expect the industry to continue in this country?

Mr. HARRISON. This gentleman is not a manufacturer of quebracho. Mr. HILL. I understand that; he is appearing in behalf of the tanners, and, as I read the statement here, is in favor of continuing the duties on the raw materials put down in the chemical bill reported last year.

Mr. HARRISON. He is in favor of the reduction made in the chemical bill reported to the House last year as to all those items as to which material reductions were made in that bill.

Mr. HILL. But the brief says:

Our recommendation in reference to these items (all of which enter into the tanning of leather) is that the rates indicated in H. R. 20182, introduced in the last session of Congress, be used in the readjustment of duties on said items, except that on tanning extracts other than chestnut and quebracho we suggest one-eighth cent per pound.

PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

And so it goes on. Now, do you recommend that the log be subjected to a duty of 10 per cent in order to get revenue?

Mr. VOGEL. No, sir; I do not.

Mr. HILL. Then, you would not insist upon the statement in this brief, that the duties provided in the recent chemical bill be made the basis of a readjustment in that industry?

The CHAIRMAN. I will state to Mr. Vogel, so that there may be no misunderstanding, that the law was changed when the bill went through the House last year, so that the word "peeling" was added to the present law. It has been suggested that to put the word "peeling" in there might put a tax on the log. There was no intention on the part of the committee to tax the raw material. Mr. HILL. I am glad to hear that.

The CHAIRMAN. And if that construction of the word should put a tax on the raw material, it would be corrected at the proper time. I want the record to be clear as to that point.

Mr. VOGEL. I am very glad you brought up the point, because it has been brought up to us, and we took it for granted that it was not to be taxed.

Mr. PAYNE. Has the tanning business been pretty prosperous in the United States in the last three or four years?

Mr. VOGEL. It has been pretty fairly so.

Mr. PAYNE. Pretty universally so, has it not?

Mr. VOGEL. Yes, sir.

Mr. PAYNE. With the present rate of duty both on the extract and on the leather?

Mr. VOGEL. Yes, sir.

Mr. PAYNE. Do you advocate taking the duty off the sole leather? Mr. VOGEL. No, sir; we do not.

Mr. PAYNE. Suppose the duty, which is now 5 per cent, were taken off, in order to take the duty off shoes, which is now 15 per cent, do you think that would add to the prosperity of the tanning business in this country?

Mr. VOGEL. The tanning business as it is to-day is not earning a percentage of profit which compares favorably with other industries, as far as my own knowledge goes, and the very fact that these imports of sole leather are increasing so rapidly, as they are doing, is a very good indication that the Canadian tanner has an advantage over the American tanner at the present time. With his free extracts and his labor cost no higher, he has undoubtedly an advantage over the American tanner.

Mr. PAYNE. You might get along without any duty; is that the idea?

Mr. VOGEL. I do not wish to be understood so. We have labor cost, as far as England is concerned, fully double. I can submit to you. reliable figures, which we will be pleased to give you when the leather schedule comes up, showing that where we pay $12 the Englishman and German pays six.

Mr. PAYNE. Do you advocate taking the duty of 5 per cent off sole leather?

Mr. VOGEL. We claim we are justly entitled to the difference of labor cost abroad and in this country.