O. B. SMITH.

LONG BRANCH, N. J., August 4, 1882. Mr. O. B. SMITH, of the firm of J. Lee Smith & Co., of New York, appeared before the Commission, and made the following statement: GENTLEMEN OF THE TARIFF COMMISSION: There are few, if any, staple goods of universal use that are so highly taxed by the present tariff as paints. Comprising as they do articles of necessity to every property-holder in the United States, it would seem as if the burdensome duties now levied upon them should be lessened and many of the prohibitory ones be done away with entirely, or at least placed upon a footing which would bring them within the reach of our manufacturers and consumers. Among the many articles that are comprised under this head I would instance a few cases of such flagrant overtaxation, to which I invite your attention.

The most important pigment in the paint list is the article of white lead, which, under the present tariff, is taxed 3 cents per pound duty. This article we purchase in England, at a cost of 20s. 4d. net, packages included, which is equivalent to $4.95 per 112 pounds, or a cost per pound of 4.42 cents, which the English manufacturer receives, against a similar article made in this country, for which the American manufacturer receives 7 cents per pound. The duty on this quantity is 3.36 per cent., giving the American manufacturer a protection of 67.87 per cent. Were it not for this exorbitant duty we could sell this article, with shipping expenses included, at a cost to the consumer of 5 cents per pound. The difference of 14 cents per pound is what is paid by the consumers in this country on an estimated consumption of 55,000 tons per annum. As a proof that this duty is almost prohibitive, I will state that there was imported for the eleven months ending with May 31, 1882, only 931 tons of English white lead, both dry and in oil, into this country, the value of which was $116,975. It would seem that, taking into consideration the enormous quantity of pig lead produced in this country, and with the best facilities for the manufacture of white lead, that the American manufacturers should be content with a smaller profit than they are realizing at preseut, and I should therefore suggest a rate of duty not exceeding 14 cents per pound, which, adding the cost of freight charges, &c., would be ample protection upon such a necessary article.

The pigment known as red lead costs in England 16s. 1d. net, packages included, equivalent to $3.91 per 112 pounds, or 3.49 cents per pound. Upon this quantity the duty is $3.36, which makes a protection. of 85.94 per cent. For the American manufacture of this article 64 cents per pound is demanded. It is very extensively used in the manu facture of glassware, for which our manufacturers are endeavoring to find an export outlet, but the difference in the price they are forced to pay for the American product seriously hampers them in competing with the foreign market, as well as for our home trade in fine glassware, which has to be made from a certain production of red lead made only in England. Combined with the importation of litharge, which two pigments are classed together, the total imports for the eleven months

ending May 21, 1882, amount to only 255 tons, of the value of $25,079. This article is also very extensively used for the preservation of ironwork, iron vessels' bottoms, tin roofs, &c. We claim that the duty on this article should not exceed 25 per cent. ad valorem.

Litharge is used largely by glass and rubber manufacturers. It costs in England 178. 7d. per 112 pounds net, packages included, equiv alent to 3.81 cents per pound, on which the duty is 3.36, or a protection of 78.69 per cent. to the American manufacturer. The market price of this product is 6 cents per pound. We would suggest the duty on this be placed at 25 per cent., as it is used almost entirely by manufacturing interests.

Paris white is made from English cliffstone, which is admitted free of duty. It costs in England 36s. per ton, or 39 cents per 100 pounds, the duty on which is $1 per 100 pounds, or a protection of 256 per cent. It is used very largely by manufacturers of wall-paper, oil-cloths, in whitening ceilings, &c. The consumption of Paris white amounts to many thousand tons per annum. The quantity imported for the eleven months named, including whiting, amounted to only 1,619 tons, of the value of $14,146, on which the government received in duty $36,249.25. As the article of cliffstone, from which this is manufactured, is not found in this country, and the manufacture of it here employs but very few people, we would suggest that the duty be fixed at not over 25 per cent.

Whiting costs in England 20s. per ton, or 21 cents per 100 pounds, the duty on which is 1 cent per pound, or a protection of 476 per cent. It is an article of almost universal consumption, being used extensively by the wall-paper manufacturers, in the manufacture of putty, oil-cloths, and a variety of manufactures. It is made from English chalk, a substance which is not found in this country, and admitted free of duty. We are not aware of any having been imported for some time, although as the articles of Paris white and whiting are classed together in statistics, being very similar, it is difficult to state positively. We would sug gest that the duty be fixed at 25 per cent.

China clay costs in England 278. per ton, equivalent to $6.56, on which the duty is $5 per ton, or a protection of 76 per cent. It is used by china and porcelain manufacturers, also largely by the paper manufacturers. There are no corresponding grades of china clay found in this country to answer the purpose for which the English china clay is used, and the difference in cost to the china and porcelain manufacturers in this country and those in foreign countries is so great as to place our manufacturers upon a very unequal footing with their foreign competitors. The preparation of china clay consumes but very little labor, and is therefore of a trifling benefit to the American laborer, whilst our large China and paper manufacturers are forced to pay an unnecessarily high price for their raw material or use the poorer qualities found in this country, which produce a much inferior manufacture of china and paper. We suggest that a duty of 25 per cent., to which should be added the heavy freights and expenses attendant upon the importation of such a bulky merchandise, would be ample protection for the few persons engaged in its production in this country.

Linseed oil is worth in England, at present, £25 per ton, equivalent to 40 cents per gallon, the duty on which is 30 cents, or a protection of 75 per cent. This article is often advanced by speculation and temporary causes to an artificial value, which the consumers are obliged to pay, as the prohibitive duty prevents the importation of the foreign oil which would correct the market. We would suggest that a duty of 15 cents per gallon would be ample protection to the manufacturers in this country,

jas, for instance, at the present time the oil is worth in this market 52 cents per gallon, upon which it is supposed they are making a fair profit, and should the price be raised the oil could be landed here for 55 cents per gallon to serve the purpose mentioned before.

By Commissioner AMBLER:

Question. What is the average price of it?-Answer. The price in August last was 49 cents a gallon. Since that it has been up as high as 65. We bought in July last at 42 cents, and resold it two months afterwards at 52 cents. When there is a little scarcity it will put up the price sometimes as much as 20 cents a gallon, but the duty of 30 cents is so great that we cannot bring in foreign oil. The price ranges in England from 40 to 55 cents a gallon. If they put up the prices to a speculative degree, we could bring in foreign oil. Linseed oil is an article of immense consumption in the oil-cloth trade alone. It is about the most important article which we have, next to petroleum.

Venetian red is produced almost entirely in England, and is admitted at a duty of 25 per cent. It is a paint of the most common use, required by all classes of people who use paint at all. There is scarcely a farmer in any section of the country who does not use more or less of it to paint his house, barns, fences, &c. The consumption of it is about 20,000 barrels per annum. We know of only two manufacturers in this country, who produce but a small proportion of the total amount./ We would suggest, under these circumstances, that it be admitted free of duty. Ochers and ochery earths are taxed at the rate of one-half cent per pound, and are among the most largely used of any class of paints. The qualities found in this country are very poor, and are unsuitable for the uses to which the foreign ochers are put. The low grades found here are used almost entirely by the oil-cloth manufacturers, and are produced so cheaply that no foreign ocher, if admitted free of duty, with heavy expenses upon them for shipping, &c., could compete with it in price. We should, therefore, suggest that they be put on the free list, as they are articles of necessity to the manufacturers and consumers alike.

The foregoing are but a few instances of the exorbitant rates of duty charged upon this class of goods, and as fully 75 per cent. of pain's and colors are used for the preservation of wood and iron work, principally in the country, it would seem as if the whole list should be admitted at a low rate of duty, which, in few cases if any, should exceed 25 per cent.

We would also call your attention to section 2499 of the Revised Statutes of the United States, which has caused much trouble in our particular line of goods. It provides that the duty shall be paid on any nonenumerated article which bears similitude either in material, quality, texture, or the use to which it may be applied, to any article enumerated in this title as chargeable with duty, the same rate of duty which is levied and charged on the enumerated article which it most resembles in any of the above particulars before mentioned, &c. We would recommend that this section be repealed, as it gives rise to endless litigation.

By Commissioner AMBLER:

Q. What would you recommend as a substitute? The mere repeal of the similitude section would perhaps be hardly fair without some other provision in its place.-A. It is easy to make a list from the statistics in the custom-house of these articles in the different lines of business that are imported, and all that are imported should be put down at a certain rate of duty; and any article in that line unenumerated could be charged 50 to 75 per cent. ad valorem.

By Commissioner MCMAHON:

Q. You would make a general clause to cover all unenumerated articles, and make that clause specific in its rates?-A. Yes; but I would enumerate everything almost that is imported. The article of whiting is taxed 1 cent a pound duty. It is nothing more nor less than chalk ground up and floated off in water and settled in a tub. That in the first tub will be sand, and in the next tub whiting. Any one would see, in following out the line of that manufacture, that it is nothing but prepared chalk. That would be plain, and yet prepared chalk is especially enumerated in the tariff at 25 per cent. duty, which would be about of a cent a pound, whereas whiting, which is prepared chalk, is charged a cent a pound. During this year a party found some cliff-stone that required no washing. It was brought into this country, and they have been unable to find out whether that article, as imported, is chalk, prepared chalk, whiting, or Paris white. If I take the two articles of Paris white and whiting I don't suppose one gentleman in a thousand could tell the difference.

By Commissioner AMBLER.

Q. There is, however, a commercial difference?-A. Yes, there is: but it is left a good deal to the honor of the seller. In this case I understand, Appraiser Howard asked him what he did with this article claimed as prepared chalk. He answered that he sold it. He was asked what for, and answered, "I sold it for Paris white." That was in favor of the government. But still, it is a very close question whether it was whiting, Paris white, or prepared chalk. And there are those two items there which are really one and the same thing, assessed at of a cent a pound duty in the one case, and at 1 cent a pound in the other.

By Commissioner MCMAHON.

Q. Do you mean to say there is a commercial distinction without a commercial difference?—A. Of course an expert could tell the difference; but it would be only by the superior whiteness of the one article, or by its toughness, and an ordinary person would not be able to tell the dif ference. Under this section, 2499, orange mineral was charged a rate of duty of 3 cents per pound.

Q. That was by decision.-A. We paid that duty, I suppose, for twenty years, because they said that it most resembles red lead, and under this section we must pay 3 cents a pound. So we paid that duty, I think, for twenty years, and the matter finally came up in suit, and the court decided that it should pay 25 per cent. as a "painter's color not other wise provided for." And we got back under that decision some $2,800. Also section No. 2907, which provides for an additional 24 per cent, to to be added to the market value of the goods, should be repealed, as it is a petty extortion on the part of the government, and an addition to the duties levied by law, for which there seems to be no right or justice, They add 24 per cent. to the invoice value, and you have to pay the ad valorem duty in addition, which gives rise to much trouble and loss to to the merchant, and seems to be unjust.

By Commissioner OLIVER:

Q. Would you recommend a specific duty instead of ad valorem?-A I would recommend specific duty in all cases where possible.

By Commissioner MCMAHON :

Q. Are these staple articles?—A. Yes, sir.

By Commissioner OLIVER:

Q. Would it be practicable, and work easily, to assess them by the pound or gallon?-A. To assess them specifically would be very much better.

Q. Then, as I understand you, as a general principle, you are in favor of specific duties, and not ad valorem -A. Yes; decidedly.

We would also respectfully urge the adoption of the suggestion made by the Assistant Secretary of the Treasury, Hon. H. F. French, a few days since, that a special court of claims be established to have the sole consideration of revenue cases, as the present mode of settling such disputes gives rise to much trouble, delay, and expense to the merchant. As an example of the working of the present system we would instance the following in our own experience. Section 2505, Article 1554 of the free-list, reads as follows, "Colcothar, dry, or oxide of iron."

Upon an importation of ours in 1873, the collecter charged us 25 per cent. ad valorem, classifying it as "a painter's color not otherwise provided for." Upon appeal to the Hon. Secretary, George S. Boutwell, he decided in our favor that it should be free of duty (decision 1349 of the year 1873). The matter being again agitated, the Hon. Secretary, B. H. Bristow, in a letter of instruction to the collector at Boston, August 21, 1874 (decision No. 1912), defines "colcothar as being a dry oxide of iron produced by chemical action, but not chemically pure, containing quantities of lime, sulphuric acid, and sulphate of lime as impurities." We continued to import this free until 1876, when the collector again charged us 25 per cent. duty. The Secretary, L. M. Morrill, again decided in our favor. It then rested until 1880, when Secretary John Sherman decided it should pay duty (decision No. 4700). In the spring of 1881, the government adopted a plan of analyzing all importations of colcothar, and at first adopted the standard of 90 per cent. purity to entitle it to free entry. The result being that if it fell below this standard it was charged 25 per cent. duty, although of less commercial value than the pure oxide. As a consequence of this arbitrary ruling against the spirit and intent of the law, we have been forced to pay thousands of dollars in duty upon an article which the law declares shall be free of duty without any standard as to its purity. Since this ruling was established we have had a number of decisions upon importations, sometimes in our favor and sometimes against us, and we could never tell before the liquidation of the entry whether we would be charged duty upon it or not, which uncertainty compelled us a short time since to sue the government to have the matter finally settled in the courts, which under the present state of the calender may be deferred for perhaps two years, whereas, if we had such a court of claims as proposed, we could arrive at a settlement of the question with comparatively little delay.

We had a shipment of oxide by the steamship Roumania in April, 1881; part of it was put in 20 casks, and the rest of it in 50 kegs. They passed the kegs as analyzing over 90 per cent., and the 20 casks from the same pile, according to other analysis, was only 33.3 per cent. oxide. We appealed on that, and the Secretary decided that they had had it analyzed by the government chemist, and we should pay duty. I wrote to the Secretary again and told him it was a mistake, and asked a reconsideration of the matter. There it rested for two or three months. He then said they had had it re-tested and found that there was only 33.3 per cent. of oxide, and he must decide against us. I then went up to the appraiser's office and asked them to turn up their formal sample from that shipment, which they did. They gave me part of that sam H. Mis. 6-23