Thursday 7 February 2013

Working in Ottawa today --Taxes and Tariffs

Good morning folks,

I will be working in Ottawa today.

Yawn.   Boring day in the news unless of course I missed something real exciting but I doubt it.

Seems its all money, all the time.  The Senate is looking at why there is a price gap between the U.S. and Canada.  You know it, you've seen it.

Even walk into a book store and two prices are listed $29.95 CDN, $19,95 USD.  Odd you may think to yourself, walk up to the counter and offer to pay in some US dollars left over from your trip to Seattle last year when you saw your great aunt Merdle and you will be met with blank stares and stammering refusals from the check out gal.

You see, it's not about the exchange rate of the currency.  No.

It's WHERE the book is sold not how it is sold.  More specifically, it is WHERE the book is and where it came from.

Let's not talk books, let's talk hockey pants.  A true Canadian eh?  When hockey pants are imported into Canada they are subjected to a tariff, if the come from China, the tariff is 18%, when they are brought in from the US they are subject to a 2.9% tariff.

This is to protect, in theory, the struggling hockey pant industry here in Canada...  oh wait.. We don't have one.  We used to, but it died a slow painful death as a result of cheap imports from Malaysia, China, or wherever.

Now if us fine Canadian's don't want to pay the marked up Canadian prices for hockey pants, we can skip across the border and buy them from a US merchant.  This will save some coin for your pocket.. and guess what else, suck some money right out of the Canadian economy!

Yeah, sorry about that, feeling a bit tired and cranky today, spent the last two days and evenings and early mornings preparing arguments for an upcoming legal battle and I am wrote out.  Just don't want to type anymore.  Do me and yourself a favour, I wrote a much earlier pulp (2008) about tariffs and labour, it is just as timely as when I wrote it.

Hell, while you are at that there is another on Keynesian economics from 2009, that is not necessarily about tariffs, in fact it isn't, but it's a nice piece on economics and exactly how corporations will screw you up the ying-yang if given the opportunity.

That's it.  I am going to enjoy the short flight into Ottawa and have a steaming hot cup of coffee.

Have a good day, and remember a raising tide, raises all yachts.


  1. Tired and cranky and paid too much for the book and the hockey pants eh. :)

    Maybe you can catch an earlier flight home tonight before we get tons of snow and sneak in a nap And a full nights sleep.


  2. I wonder if there is a price gap on e-books. I'd like to see such a thing be justified. Bloody sleeveens!


  3. Now, i may not be an expert on tariffs, but I'm pretty sure its not about where the product is sold, however where the product was made.

    If you purchase hockey pants from the USA and they were manufactured in the USA, then i believe NAFTA mandates that the trade is free between countries.

    Ont he other hand, if those pants were originally manufactured in china, and you bought it from the states, you will then have to pay the tariff because of the origin of the pants not being any location inside of North America.

    I guess the tricky (and highly unlikely) situation is where you purchase the hockey pants from your favorite on-line shop in china (Hockey-R-us for example) and the shop you just purchased these pants from actually imported them from the USA. in that case i believe even though it is shipped from China, the origin of the pants was (and still is) the USA; therefore, no tariff would apply.

    As for book prices, I've been paying the i-tunes bookstore price which seems to be higher than the amazon+shipping price anyways. I sold my soul to Apple when i bought that i-pad... at least it supports Airplay™ so i can read my books on my 70" TV. Definitely worth the extra $8.94

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