Canada Axes Tariffs For Manufacturers

by Mike Godfrey, Tax-News.com, Washington

30 November 2011

Canada's Minister of Finance, Jim Flaherty, has announced that a further 70 tariff items are being eliminated to cut the operational costs of Canadian manufacturers by CAD32m (USD31m) annually, as part of the government's efforts to lower taxes and trade barriers for business.

“By lowering costs for these businesses, we are enhancing their ability to compete in domestic and foreign markets and helping them invest and create jobs here at home. This measure acts on our government’s commitments under our low-tax plan for jobs and growth and reinforces our G-20 leadership in the fight against protectionism,” Flaherty said.

Under the 'Economic Action Plan', the government aims to eliminate all tariffs on imported machinery and equipment and manufacturing inputs to make Canada a "tariff-free zone" for industrial manufacturers by 2015.

In Budget 2010, the government consulted with the public on further trade liberalization proposals, and the latest tariff relief is as a direct result of those consultations.

“Eliminating tariffs on goods used in manufacturing helps Canadian companies operating in a wide range of sectors by lowering their production costs. This will benefit Canadian manufacturers by increasing the competitiveness of their operations, thus contributing to a stronger economy,” the government said.

Since 2009, the Canadian government has eliminated more than 1,800 tariff items and provided more than CAD435m in annual tariff relief to Canadian businesses.

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