The freight rate structure is the price list at which railways sell their services. It is distinguished from the pricing systems of businesses other than public utilities by the degree of its differentiation or discrimination. Freight tolls are not based on cost except in a general way but on value of service. The carriers charge low rates on raw materials and basic commodities, the products of farm, forest, mine, and sea which will not stand higher rates and still move in volume, and they collect relatively heavier tolls on manufactured articles and general merchandise which are better able to bear such tolls. This differentiated pricing arrangement was devised to enlarge railway revenue by encouraging the movement of freight, the widening of market opportunities, and the settlement of the country. Though calculated chiefly to meet the financial requirements of the railways, the system aided business and advanced national interests. During the last twenty years, however, the conditions of transportation have so altered that a complete re-examination of the entire pricing system of railways is now required.

The need for this re-examination can be seen most clearly in terms of the historical development of the Canadian freight rate structure. During the period 1885 to 1915 railways benefited from improved technological efficiency, rapid growth in the volume of their traffic, and increasing density per mile of line. The gains from these changes went chiefly toward generous dividends on Canadian Pacific stock and capital re-investment in railway property. In addition, some important reductions in rates were granted. For the most part, these did not take the form of scaling down substantially all rates but of cutting the tolls on basic commodities and the rates to various sections of the Dominion.

The provision of a satisfactory transportation system is absolutely indispensable if Canada is to survive as a national unit. Without a transportation system which moved, relatively cheaply and conveniently, vast quantities of the country's primary products over long distances, it would be literally impossible for great sections of Canada to support its present population. In this context, modern transportation really means railway transportation for no other form of transportation can possibly transport such commodities as wheat, coal, and lumber over the distances and in the volumes which are involved in Canada.

For this reason, there has never been any difference of opinion as to the absolute necessity of providing the Canadian railways with sufficient revenue to enable them to continue to provide satisfactory transportation service. There have, however, been serious differences of opinion as to whether or not the present freight rate structure does yield to the railways enough revenue for that purpose and as to the source from which any additional revenue should be secured if it is decided that it is necessary. There have also been differences as to who was to be given the responsibility and authority to decide these issues.

The present period is one in which emphasis on the need for rendering economic theory “dynamic” is widespread. Yet there is little reference in the literature to the concepts and measures of time which are appropriate for the economist. Indeed one is sometimes at a loss in examining certain dynamic theories to know precisely what notion of time is held by the authors. It is this situation which has prompted the present writer to ask a few questions concerning the problems posed for the economic theorist who would treat time specifically.

While this is too early a date to produce for discussion a tentative questionnaire for the 1951 Census, with all the necessary definitions, we, in the Dominion Bureau of Statistics, are greatly pleased to have the opportunity of placing before you some of the problems that we will have to solve before our army of enumerators begin their house to house canvass to gather the information. Along with the discussion of these problems, I would like to mention some of the improvements that we propose to make in the 1951 Census as compared with previous censuses.

The taking of a census is a very important and costly operation. The Advisory Committee on the United States Census stated in 1921: “Of all the peace-time activities of the federal government, taking and compiling the census is the largest.” Because of its high cost, it is necessary to make it yield its maximum both in quality and quantity of returns. The problem of determining the optimum quantity, keeping in mind that quantity very often works against quality, is possibly one of the most difficult ones to solve. Just before the census is taken we receive suggestions from a very large number of persons and groups for additional questions to be placed on questionnaires. These persons reason quite correctly that the most costly part of our organization is the one which makes it possible to cover every nook and cranny of this vast country of ours; and they also reason, not quite so correctly, that since our enumerators visit every home anyway, there is no harm is asking a few more questions. Mind you, the great majority of these questions are worthwhile and would produce information which is not available anywhere else. We are, therefore, placed in the unhappy position of having to appear to be unco-operative or to load our questionnaires beyond the point where it is possible to obtain reliable information. The first point, then, is to determine how long census questionnaires should be to provide as much information as possible without placing the quality of the statistics obtained in jeopardy.

This paper is concerned with rural local government, and particularly with the equalization feature of grants to local governments. Reference is made to the Alberta situation.

Significant Differences between Urban and Rural Municipalities. The position of the rural municipality is significantly different from that of its urban counterpart. The basic difference is in fiscal capacity. Fiscal capacity is financial ability, within the taxing powers provided, to perform the functions for which the municipality is responsible.

All taxes are ultimately paid out of income. Rural per capita income is relatively low; disparities in income are less pronounced; production and income are more variable and uncertain; and income produced in rural areas is largely spent within urban jurisdictions. Consequently taxable capacity is lower; and certain forms of taxes (for example, income taxes, sales taxes, and amusement taxes), efficient and appropriate under urban conditions, would be unproductive and uncertain sources of revenue under rural circumstances. The fiscal capacity of rural units is further affected by population dispersion so that the costs of some services, frequently sources of net revenue to urban governments, are high or prohibitive in rural areas.

The nature, origin, development, and possible justification of the municipal business tax in Canada are the topics considered in this paper. These subjects are all the more interesting because there has been no comparable development in the United States. Statistics as late as May, 1947 indicate that New York City is the only city in the United States with a business tax comparable to the municipal business tax in Canada.

The term “municipal business tax” generally is used in Canada to refer to a tax on premises occupied for business purposes. Three bases are in use: a fraction of the assessed value of the premises, the annual rental value of premises, and square feet of space occupied.