‘Very little support’ for border tax

CALGARY • Natural resources minister Jim Carr on Thursday downplayed U.S. enthusiasm for a border-adjustment tax on Canadian imports, adding that talks with the Trump administration are a “work in progress.”

“There was very little support for it,” Carr said from Washington, D.C., where he is on a three-day trip to meet with several congressman, senators, lobby groups and business executives.

“It’s not just that people here are expressing an agreement in principle with free trade, it’s that they are specifically saying that a border-adjustment tax would not move along the interests of Canada and the United States.”

Concerns over the spectre of a U.S. border-adjustment tax have pervaded the Canadian business community ever since Donald Trump assumed the presidency with a mandate to favour domestic suppliers. Trump exited the Trans-Pacific Partnership on his first day in office, and has promised changes to the North American Free Trade Agreement.

The border-adjustment tax was floated by U.S. House Speaker Paul Ryan before Trump entered the White House. It would effectively prevent U.S. companies from deducting imports while allowing them to avoid taxes on export revenues, encouraging local procurement of goods.

The tax would impact Canadian companies deeply dependent on U.S. exports, and could apply to anything from oil to auto parts.

Carr said most of the U.S. congressman and senators he met with solidly opposed the policy.