Canada threatens US to impose trade taxes | World | DW

Canada on Friday (12.10.2021) threatened to impose tariffs on US products and suspend parts of the historic trade agreement if Washington continued its proposal in support of US-made electric cars with union workers.

In a letter to U.S. senators, Canadian Deputy Prime Minister Christiaan Freeland wrote that he was “deeply concerned” about President Joe Biden’s proposed tax relief for electric vehicles as part of his “Built Back Better” Bill in Ottawa. USA, Mexico and Canada.

The proposed tax exemption is equivalent to 34% of the tariff for electric vehicles assembled in Canada, and its use is “a significant threat to the Canadian automotive industry and the practical abolition of the USMCA.”

“Tax Benefit”

Included in President Joe Biden’s $ 1.75 trillion budget, which is pending in Congress, the proposal favors U.S. production by offering higher tax breaks for electric vehicles (EVs) produced by union workers, as well as phasing out imported EVs after five. Years.

Mexico and Canada argue that it threatens the integrated supply chain in North America, which was implemented by USCMA and signed in 2020 after lengthy negotiations.

Non-union automakers led by Toyota and Tesla also oppose Biden’s proposal, which was approved by the United Auto Workers’ Union, which would slow the transition to electric cars.

If the move goes through, Freeland says Canada will impose new retaliatory charges on the US auto industry and other economic sectors.

Freeland added that a list of US products that may face new taxes will be released in the coming days.

mg (afp, National Post)