U.S. AMBASSADOR BACKS COLLINS PUSH TO EQUALIZE CANADIAN TRADE ALLOWANCES

Washington, D.C. -- Senator Susan Collins has received a letter of support from the U.S. Ambassador to Canada for her efforts seeking parity between U.S. and Canadian personal exemption allowances. These allowances determine the amount of merchandise that people can bring back to their home country after making purchases across the border, without having to pay duties on those goods.

Americans traveling to Canada are allowed to return to the U.S. with significantly more merchandise than Canadians who visit the U.S.. For example, a Canadian citizen is given no duty-free personal exemption allowance for trips under 24 hours and Canadian Customs is instructed to begin collecting duties and taxes on merchandise as long as it can collect three Canadian dollars. By contrast, an American traveling to Canada for less than 24 hours is exempt from paying duties on $200 worth of merchandise on return to the U.S.. For trips longer than 48 hours Americans are exempt from paying duties on $800 worth of goods.

"We must end the duty disparity between the U.S. and Canada that unfairly disadvantages American businesses. It discourages Canadians who live near the border and who work in or visit the U.S. from buying goods here. The discrepancy in personal exemption allowances puts U.S. retailers in border communities at an enormous disadvantage," said Senator Collins. "I have heard repeatedly from small business owners in Maine about the detrimental impact of the disparity and their message is loud and clear: this policy must be changed."

The U.S. Ambassador told Senator Collins that he shared her view that more generous personal-duty exemptions on the part of Canada would stimulate cross-border trade.

"Thank you for your letter calling for Canada to increase customs allowances for Canadian citizens returning from the United States," wrote Ambassador Paul Cellucci. "To reinforce the message, I plan to raise this issue with senior Canadian trade and financial officials at every appropriate opportunity. The Embassy will continue, in coordination with the U.S. Trade Representative and Treasury, to press the Government of Canada to offer its own citizens the same benefits we provide to ours."

In September 2003, the Senate unanimously approved a bipartisan resolution championed by Senator Collins that asks the U.S. government to continue negotiations with Canada to eliminate the disparity between our personal exemption allowance structure and those in effect in our neighboring countries of Canada and Mexico.