About Tariffs
From 1854 to 1866, a Reciprocity Treaty was in place between Canada and the United States that allowed free trade between the two countries. However, after the Civil War ended in 1865, the U.S. terminated the treaty to try to protect their industries. Once it became evident that Huron County was producing a significant amount of salt, the United States slapped a tariff on Canadian salt to ensure it was more expensive than U.S. salt. That tariff was sixty-seven cents a barrel, which equated to forty percent of the average cost of a barrel of Goderich salt, which was one dollar and sixty-eight cents at the time.
Despite the salt producers’ best efforts to convince the Canadian government to apply an import duty to the salt flooding the Canadian market from both the United States and Britain, it was to no avail. The government did not want to impose a tariff against the U.S. because if it did, it would also have to apply a tariff against imports from Britain.
The situation was so dire that the Bruce Telescope reported:
American salt is nearly a dollar a barrel cheaper in Canada than it is in the United States. This is undoubtedly below the actual cost – the price is the result of an effort to undersell and crush out the Canadian manufacturer of a superior article.
It wasn’t only the Canadian salt producers who were concerned about foreign competition. In March, Peter McEwan, Samuel Platt, and other salt producers joined forces with eighty other merchants and manufacturers from a broad spectrum of industries at a meeting in Toronto to discuss creating a protectionist coalition. They wanted the Canadian government to put tariffs and import quotas in place to restrict imports from other countries.
After the House of Commons heard their appeal for protectionism, they created a Select Committee to report on the extent and condition of salt interests in Canada. When the Committee completed its study, they recommended the House adopt measures to provide relief for the salt industry. However, in a disheartening move, the same day the motion for the import duty on salt was introduced, it was withdrawn without explanation. To maintain its dedication to free trade, on April 30, the House passed a resolution that salt and other items to which the tariff now applied could be imported free of duty once the United States permitted Canadian salt to be imported free of duty. The House still stubbornly clung to the hope that the United States would renew the Reciprocity Treaty.
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