Duty-free hikes criticized locally

Raised limits in value of duty-free goods allowed are a cause for concern among local political and commercial spokespersons

  • Apr. 9, 2012 6:00 a.m.


A lot of information was released in the March 29 budget speech by federal Finance Minister Jim Flaherty. Of particular relevance to Castlegar and all other locations within an easy drive of the U.S. border, was the revelation of boosted duty-free values for Canadian shoppers.

The federal government has raised the duty-free limit from $50 to $200 for a 24-hour visit to the U.S. and from $400 to $800 for a 48-hour trip. In doing so it has also raised the ire of businesses within that same easy drive, even though it may be music to the ears of Canadian consumers.It’s a matter of so-called leakage which is nothing new in this part of the province, but with limits being upped, so rises the backlash.

“I don’t know why they did it,” said Kootenay West MLA Katrine Conroy, one of several people contacted for comment on April 5, even though the level of government and opposition she represents has no official input in such matters.”I was quite surprised,” said Conroy. “It’ll hurt local business is what it’ll do. I think it wasn’t done with much thought for places like rural B.C. I don’t know who they’re trying to cater to. The people who go shopping across the line will be happy, but anybody I’ve talked to was surprised by it, because all the people I know shop local.”

“Shop Local” is a familiar slogan in many communities, including Castlegar. The move to up the duty-free levels also caught chamber of commerce president Pam McLeod somewhat off guard.”I did not see it coming,” said McLeod, “but I was not able to take part in the conference call with the Canadian Chamber of Commerce. My question right now is, ‘what’s the policy trade-off when it comes to the action that the federal government has taken?’ Because, clearly they are promoting economic stimulation on the U.S. side over the Canadian side.”

Time will tell what sort of affect the regulation changes will have on cross border traffic, but McLeod had some information pertaining to 2010-2011 activity at a nearby crossing point, which she passed along.”Same day Canadian visits (at the Waneta crossing near Trail and Patterson crossing south of Rossland)… the minimum total of same day Canadian resident visits were 4,300, to a maximum of 6,700,” she said, clarifying that those numbers represented one-day activity.

McLeod said she had no further break-down of the origin of the visitors or the intent of the visits, but continued, “a person is only led to think that it’s (for the most part) locals from within this region.”On the positive side Pam Mcleod insists that for every challenge that comes along a corresponding opportunity must be sought. “So we will be looking for the opportunity to capitalize on this with respect to our business climate here, specific to Castlegar.”

Alex Atamanenko, federal Member of Parliament for BC, Southern Interior, does not favour the hikes in duty free levels for cross border shoppers, but expressed resignation at the situation when reached that day in Ottawa.”I don’t know what we can do,” he said, “the budget’s been passed.” The MP feels the moves were probably part of a larger program.

“This could be part of the whole harmonization of our border with the Americans,” he theorized. “I believe that’s probably the rationale. But we have to be careful when we do that, that we don’t give away our rights. I believe that this duty is not good for local business, given the economic climate, given the fact that a lot of our border communities are struggling.”

The appeal of lower priced goods will certainly attract alert consumers who have every right to go for whatever deals are out there.A hard-core bargain hound willing to go on record, however, was not easy to find while assembling this article.

Richard Horney of Trail, who visits the United States every so often with his family, said duty-free levels are not a strong consideration.”We don’t make a point of going into the U.S. to shop,” he said.”Occasionally, if we happen to be down there we might bring back some duty free items. But it’s not a motivator for going.”