In the context of NAFTA negotiations, US Trade negotiators are asking that Canada dramatically increase its de minimis threshold (“DMT”) from the current level of $20 CDN to a level equivalent to $800 USD. The DMT is the level below which imported parcel shipments by courier and post are exempt from sales taxes and duties. RCC is leading the fight against this US proposal and commissioned a detailed economic study of the issue by PwC. The study shows that hiking de minimis could lead to losses of tens of $billions both in retail sales and Canadian GDP and to major job losses in in Canada’s largest private employment sector. For a detailed understanding of a contentious issue, this is the definitive study.Click here to download the study CBC News : Here's why we pay more for everything in Canada — and always will
CTV News: Canadian producers fear U.S. will flood market after Chinese tariffs
Understanding the potential implications of the end of NAFTA is of vital importance to retailers, whether or not they import from the USA or Mexico. The A.T. Kearney-Retail Council of Canada study looks at several scenarios if NAFTA is cancelled, assesses the impact on cost of goods (COGS) and retail sales and raises some thought-starters on how to address those outcomes. For members, RCC can provide Excel spreadsheets that allow these calculations to be run by a retailer’s own mix of product categories. (Please contact Karl Littler, V.P. Public Affairs, [email protected]). While RCC remains hopeful that NAFTA will be renewed, this report remains a “must-read” for prudent planning.
A valuable companion piece to the A.T. Kearney-Retail Council of Canada study above, these slides provide a compelling assessment of the implications for retailers in Canada if NAFTA were to be cancelled. A.T. Kearney, looks at the current market, at three different post-NAFTA scenarios, the impact on cost of goods (COGS) and on consumer spending.