Right in the centre - Canada never has been smart on tariff policy

Details

Published on Thursday, March 20, 2025

By Ken Waddell

Neepawa Banner & Press

The recent furor about U.S. imposed tariffs has had a disturbing effect on Canadians, but an author by the name  of David Clinton has some interesting things to say about Canadian tariffs and similar measures. 

Clinton has written, “The Customs Tariff Act governs Canada’s import tariffs. All goods entering Canada from countries on the Most-Favoured-Nation list that aren’t eligible for lower rates through trade agreements are subject to tariff charges as high as 17 per cent. Here are some practical cases of imports from the U.S. that aren’t covered by the CUSMA trade agreement:

• U.S. t-shirts using imported fabric could face an 18 per cent tariff, adding $18,000 to a $100,000 shipment.

• A $30,000 U.S.-assembled car with Asian parts incurs $1,830 in duties.

• $50,000 of U.S. strawberries could face $4,250 in seasonal duties if applied.

• $200,000 of steel wire from the U.S. could face $108,000 in extra anti-dumping duties.

Canada’s supply management system for dairy, poultry, and eggs is a notorious example of a policy that looks and sounds like an import tariff. Supply management is governed by a combination of federal and provincial laws, including the Export and Import Permits Act and the Farm Products Agencies Act. Regulations can hit over-quota imported cheese with rates as high as 245.5 per cent and chicken can be taxed at 238 per cent. And that’s assuming you somehow manage to score an import permit from Global Affairs Canada.

The Canadian Food Inspection Agency enforces strict sanitary and phytosanitary (SPS) measures that often require layers of inspections or certification requirements that can significantly raise compliance costs. The differences between some of those requirements and an economic tariff are not always obvious.

The Canada Border Services Agency collects an excise tax on imported liquor. For example, a U.S. exporter looking to ship 100 litres of 40 per cent ABV whiskey to Canada will face a duty of $467.84 (100 × 0.4 × $11.696). That duty must be paid by the importer.

The various Canadian Content (CanCon) rules governing broadcast media will also undermine the principle of free trade, even if those rules won’t necessarily increase import costs.”

Clinton’s article lists a number of other Canadian imposed trade restrictions, but the above list gives a pretty good insight that shows Canada’s rules aren’t a lot different from the pressures the United States is putting on Canada.

In addition, Canada putting a big tariff on cheap Chinese electric vehicles (EVs) doesn’t make any sense, because if the Canadian government is determined to reduce gas emissions, and Canadians don’t produce any electric cars, why would they penalize consumers (and China) by making EVs twice as expensive as they could be?

Dauphin-Swan River-Neepawa MP Dan Mazier describes the US tariffs as a “punch in the face” and Canada putting on tariffs is like “punching ourselves in the face”.

It’s quite evident that Canada’s imposed tariffs punched ourselves in the face twice, as China has put tariffs on Canadian canola products and pork. Thanks Trudeau and Carney. We don’t get a chance to buy cheap EVs (and they do have a place for short distance travel) and we endangered our canola and pork industry.

If we study Canadian history, we will see that Canada has been tripping itself up with tariffs since before Confederation in 1867. You would think we might learn from the past.

As for the future, we need to look at every way we can tear down inter-provincial trade barriers. We may well see our greenhouse and hydroponics food industry grow; and maybe we will have to drink less orange juice. I think Canada could replace oranges and orange juice with our own Canadian grown apples and juice. 

Disclaimer: The views expressed in this column are the writer’s personal views and are not to be taken as being the view of the newspaper staff.