Postage Due Taxation
Letters and Post Cards
1925 - 1930
From 1925 to 1930, the Canadian post office taxed outgoing short paid international mail at a reduced rate. This article discusses letter and post card rates in effect and explains how the reduced taxation was calculated.
1. Letter and Post Card Rates Set by the UPU
We begin with an overview of postal rates set by the Universal Postal Union and by the Canada Post Office during the relevant time periods.
Prior to the 1920s, the UPU had set the rate for the conveyance of letters throughout the Union at 25 centimes (Canadian equivalent 5 cents). The post card rate was 10 centimes (Canadian 2 cents). As a result of currency devaluations following WWI, the 1921 UPU Madrid Convention established new rates. The standard letter rate was increased to 50 centimes, but members could charge a rate between 25 and 50 centimes. The Canadian UPU letter rate was increased to 10 cents (50 centimes) on October 1, 1921. The Madrid post card rate was set at 30 centimes (6 cents Canadian).
Rates were again changed at the 1925 Stockholm Convention. The letter rate was set at 25 centimes, but each country had the right to increase the rate up to 60% (40 centimes rate) or reduce it as much as 20% (20 centimes rate). From 1925 to 1930, Canada charged 40 centimes (8 cents) for a single weight letter, the maximum allowed by the UPU. The Stockholm Convention post card rate was set at 15 centimes, with 12 centimes as the minimum and 24 centimes as the maximum. The Canadian UPU post card rate was set at 20 centimes (4 cents).
The London Convention of 1929 introduced new minima and maxima. The letter rate was still 25 centimes, but the permissible rate range was from 20 centimes to 37 1/2 centimes. Since the Canadian UPU letter rate was 40 centimes, a rate reduction was required. The Canadian letter rate was reduced to 5 cents on July 1, 1931. The post card rate was 15 centimes with a range from 12 to 22 centimes.
Reduced UPU Taxation Period : 1925 - 1930
Letters
During this period, the UPU had set the letter rate at 25 centimes but permitted members to increase the rate to 40 centimes or reduce it to 20 centimes. The Canadian post office elected to charge the maximum 8 cents, the Canadian equivalent of 40 centimes.
The tax by the Canadian post office however was calculated on the basis of the standard 25 centimes letter rate which resulted in a reduced tax. The reduction was obtained by multiplying the amount due by a reduction factor of 5/8.
A. Letters
The Canadian UPU letter rate was 8 cents (40 centimes).
1. Letter to Germany
The short paid letter from Toronto to Nurnberg, Germany mailed on November 27, 1929 illustrates how the reduced tax was calculated.
Letter Rate..........................8 cents
Deficiency............................6 cents
Double deficiency..............12 cents
Conversion to centimes....60 centimes (12 cents x 5 centimes/cent)
Tax Reduction Calculation
5/8 x 60 centimes = 37.5 centimes
37.5 centimes due rounded up to 38 centimes
Canadian T 38 handstamp
Instead of paying 60 centimes in postage due, the addressee was only charged 38 centimes, the amount that would have been charged had the Canadian letter rate been 25 centimes.
2. Letter to France
Saint John to Paris, April 5, 1929
Shortpaid 6 cents and taxed 37 1/2 centimes
(5/8 x 60 centimes = 37 1/2 centimes)
The tax was written in pencil
French equivalent to 37 1/2 centimes was 2.25 francs
3. Letter to Switzerland
The letter card below was mailed from the province of Quebec to Bale, Switzerland, in 1929, and taxed 19 centimes by the Canadian post office. The amount collected was 25 Swiss centimes. The Swiss postage due stamps were cancelled on June 29, 1929.
Tax Calculation
Letter Rate..........................8 cents
Amount prepaid..................5 cents
Deficiency............................3 cents
Double deficiency...............6 cents
Conversion to centimes...30 centimes (6 cents x 5 centimes/cent)
Reduction Calculation
5/8 x 30 centimes = 18.75 centimes (rounded up to 19 centimes)
T 19 ( centimes)
Instead of paying 30 centimes in postage due, the addressee was only charged 19 centimes, the amount that would have been charged had the Canadian letter rate been 25 centimes.
B. Post Cards
The post card rate was 4 cents. The reduced tax on short paid post cards was calculated by multiplying the amount due in centimes by the reduction factor 5/8.
1. Post Card to Germany
Cochrane Alberta to Dresden, June 22, 1929
Taxed 13 centimes and charged 15 pf
Tax Calculation
Post Card Rate....................4 cents
Amount prepaid..................2 cents
Deficiency............................2 cents
Double deficiency...............4 cents
Double deficiency 4 cents
Conversion to centimes....20 centimes (4 cents x 5 centimes/cent)
Tax Reduction Calculation
5/8 x 20 centimes = 12.5 centimes (rounded up to 13 centimes)
T 13 (centimes)
Instead of paying 20 centimes in postage due, the addressee was only charged 13 centimes, the amount that would have been charged had the Canadian letter rate been 25 centimes.
2. Post Card to Italy
Montreal to Milan, April 23, 1928
Taxed 19 centimes and charged 90 centesimi
Post Card Rate....................4 cents
Deficiency............................3 cents
Double deficiency...............6 cents
Conversion to centimes....30 centimes
Tax Reduction Calculation
5/8 x 30 centimes = 18.75 centimes (rounded up to 19 centimes)
19 CENTIMES
Instead of paying 30 centimes in postage due, the addressee was only charged 19 centimes, the amount that would have been charged had the Canadian letter rate been 25 centimes.
3. Post Card to Belgium
Taxed 13 centimes and charged 90 centimes
Post Card Rate....................4 cents
Deficiency...........................2 cents
Double deficiency...............4 cents
Conversion to centimes....20 centimes
Tax Reduction Calculation
5/8 x 20 centimes = 12.5 centimes (rounded up to 13 centimes)
On July 1, 1930, the Canadian UPU letter rate was reduced to 5 cents (25 centimes) and reduced taxation of short paid UPU mail was terminated.
The above letter from Quebec to Stockholm, mailed on July 2, 1931, was short paid 2 cents.
Deficiency............................2 cents
Double deficiency...............4 cents
Conversion to centimes....20 centimes (4 cents x 5 centimes/cent)
T 20 (centimes)-no reduction
