Canada, 2004
Chapter 1 : Tariffs[1] |
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Objective
APEC economies will achieve free and open trade in the Asia-Pacific region by:
a. progressive reduction of tariffs until the Bogor goals are fully achieved; and
b. ensuring the transparency of APEC economies’ respective tariff regimes.
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Guidelines
Each APEC economy will:
a. take into account, in the process of achieving the above objective, intra-APEC trade trends, economic interests and sectors or products related to industries in which this process may have positive impact on trade and on economic growth in the Asia-Pacific region and developments in the new economy;
b.
ensure that the achievement of
the above objective is not undermined by the application of unjustifiable
measures;
c. consider extending, on a voluntary basis, to all APEC economies the benefits of tariff reductions and eliminations derived from sub-regional arrangements; and
d. implement and maintain standards consistent with the APEC Leaders’ Transparency Standards.
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Collective Actions
APEC economies will:
a. participate and ensure the expeditious supply and updates of the WTO Integrated Database and any other APEC databases;
b. arrange for seminars and/or workshops on industrial tariffs negotiations in consultation with international organisations, where appropriate, including WTO Secretariat on WTO Integrated Tariff Database;
c. study lessons from modalities for tariff reduction and elimination in regional arrangements; and
d. encourage the accession of all economies to the WTO Information Technology Agreement, including the adoption of ITA provisions by non-members of the WTO.
The current CAP relating to tariffs can be found in the Tariffs and Non-Tariff Measures Collective Action Plan
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Canada’s Approach to Tariffs in 2004
The Government of Canada pursues a policy of tariff and trade liberalization to further advance Canada’s broad trade agenda, including the negotiation and implemention of multilateral, regional and bilateral trade agreements, and through unilateral tariff reduction initiatives. The Minister of Finance is responsible for import policy, aimed at securing and improving access to foreign markets for Canadian business while supporting an efficient and competitive domestic economy.
The key import policy instruments in Canada are as follows; information about these may be viewed on-line as indicated:
Customs Tariff (Most recent consolidated version, and details of previous amendments) http://www.cbsa-asfc.gc.ca/gen The Special Import Measures Act http://laws.justice.gc.ca/en/S http://www.cbsa-asfc.gc.ca/sim
The Canadian International Trade Tribunal Act http://laws.justice.gc.ca/en/C
Canada is commited to advancing free and open trade. Successive rounds of multilateral trade negotiations under the General Agreement on Tariffs and Trade (GATT) combined with regional and bilateral free-trade agreements have reduced tariffs to a point where they are less significant in many markets today. However, important tariff barriers remain in many economies. Consequently, Canada is actively engaged in the WTO Doha Round of multilateral negotiations, as well as in the Free Trade Area of the Americas regional negotiations, and in other negotiations with the four Central American countries of El Salvador, Guatemala, Honduras and Nicaragua. In addition, Canada continues discussions to explore the scope of possible negotiations with the Andean Community of Bolivia, Colombia, Ecuador, Peru and Venezuela, with the Caribbean Community and Common Market (CARICOM), and with the Dominican Republic.
Among APEC member
economies in the context of the Bogor goals concerning tariffs, Canada
celebrated it’s ten-year anniversary of the North American Free Trade
Agreement (NAFTA) with the United States and Mexico in 2004. Staged
tariff reductions under NAFTA are fully implemented; many ahead of
schedule. The Canada-Chile Free Trade Agreement has been in force since
1997, and the last of staged tariff reductions
under this Agreement took place in January 2003. Bilateral
negotiations with Singapore are ongoing. (For further information
please visit: http://www.dfait-maeci.gc.ca/t
In addition, 15 APEC members are eligible for Canada’s General Preferential Tariff (GPT), which is provided on a unilateral basis.
Contact information: Diane Kelloway Government of Canada Department of Finance Kelloway.Diane@fin.gc.ca
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Case Study of a Tariff Liberalisation Initiative
N/A |
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Canada’s Approach to Tariffs in 2004 |
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Section |
Improvements Implemented Since Last IAP |
Current Tariff Arrangements |
Further Improvements Planned |
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Bound Tariffs
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99.7% of items in HS Chapters 1 - 97 of the Canadian Customs Tariff are WTO bound.
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Applied Tariffs
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Canada’s Uruguay Round WTO commitments to reduce MFN tariffs on products including textiles and clothing have been fully implemented as of January 2004.
Canada continues to eliminate "nuisance tariffs” from MFN and preferential tariffs when they fall below the 2% threshold.
Canada continues to unilaterally reduce applied tariffs on certain goods used in the production of other goods (manufacturing inputs) or in the provision of services.
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In 2003, 89% of imports into Canada, by value of goods, entered duty-free under MFN, unilateral or negotiated preferential tariff treatments, and the import-weighted average applied tariff was less than 1%.
In general, Canada’s MFN tariffs are applied slightly below bound levels; the simple average bound and applied MFN tariff rates are currently 4.9 and 3.9 percent, respectively.
Current tariff rates are
available on-line through the APEC tariff database (http://www.apectariff.org/)
and on the Canada Customs and Revenue Agency’s website at: http://www.cbsa-asfc.gc.ca/gen
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Canada will work together with APEC member economies towards a successful WTO Doha Round, that includes real and substantial improvements in market access, within a fair and equitable multilateral trading system.
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Tariff Quotas
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Only 2% of items in HS
Chapters 1 - 97 are subject to tariff rate quotas (TRQs), reflecting
sensitivities in Canada's agricultural sector. Information explaining
Canada’s TRQ system can be found on-line at: http://www.cbsa-asfc.gc.ca/E/p |
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Tariff Preferences
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Canada has 10 preferential tariff treatments, including the following negotiated agreements that contain staged tariff reductions:
- the Canada-United States Free Trade Agreement; - the North American Free Trade Agreement (NAFTA); - the Canada-Chile Free Trade Agreement; and
For information on the above Agreements please visit: http://www.dfait-maeci.gc.ca/t
Canada also maintains unilateral tariff preferences for developing and least-developed countries. Canada introduced its General Preferential Tariff (GPT) scheme for developing countries in 1974. 15 APEC members are eligible for the GPT, which ranges from “Free” to 2/3 of MFN rates. For more information, see Section 33 of the Customs Tariff.
Duty free entry was provided to all GPT-eligible products from the least-developed countries in 1983. The LDC product coverage has been expanded twice; in August 2000 and again in January 2003. All imports from LDCs (except for dairy products, poultry and eggs) now enter Canada duty and quota free.
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In addition to working together with APEC member economies towards a successful WTO DohaRound,Canada is also engaged in negotiations with the four Central American countries of El Salvador, Guatemala, Honduras and Nicaragua, the Free Trade of the Americas negotiations and negotiations with Singapore. Canada continues discussions to explore the scope of possible negotiations with the Andean Community of Bolivia, Colombia, Ecuador, Peru and Venezuela, with the Caribbean Community and Common Market (CARICOM), and with the Dominican Republic.
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Transparency of Tariff Regime, including Implementation of APEC Leaders’ TransparencyStandards on Market Access*
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Canada provides annual updates of tariff and trade information to the WTO Integrated Database. Current tariff rates are available to the public in viewing or downloadable format through the APEC tariff database (http://www.apectariff.org/) and on the Canadian Border Services Agency’s website: http://www.cbsa-asfc.gc.ca/gen
See the tariff summary and dispersion tables at the end of this chapter, for more information.
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Improvements in Canada’s Approach to Tariff Measures since 1996 |
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Section |
Position at Base Year (1996) |
Cumulative Improvements Implemented to Date |
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Bound Tariffs
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99.7% of items in HS Chapters 1 - 97 of the Canadian Customs Tariff are WTO bound.
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Applied Tariffs
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Between 1996 and 2003 the percentage of imports, by value of goods, that enters Canada duty-free under MFN, unilateral or negotiated preferential tariff treatments, has risen from 78% to 89%. Canada’s import-weighted average tariff applied to all imports has decreased from 1.3% in 1996 to 0.9% in 2003.
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On an annual basis commencing January 1, 1995, Canada has implemented its tariff reduction commitments as per the Uruguay Round agreement in the WTO, including the zero-for-zero initiatives. These reductions have been fully implemented as of January 1, 2004.
Canada removed tariffs on pharmaceutical products as a result of Pharma II (April 1997) and Pharm III (July 1999) commitments in the WTO.
Canada as a signatory to the Information Technology Agreement (ITA), reduced tariffs on all products subject to that agreement. Final reductions were implemented January 1, 2000.
Canada accelerated to 1998, the Uruguay Round tariff reductions for all products that were to have final cuts in 1999, including zero-for-zero initiatives in the medical equipment, agricultural equipment, construction equipment, and office furniture sectors.
Canada has eliminated “nuisances tariffs” from MFN and most preferential tariffs when they fall below the 2% threshold since January 1, 1998.
Canada unilaterally reduces applied tariffs on certain goods used in the production of other goods (manufacturing inputs) or in the provision of services.
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Tariff Quotas
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Only 2% of items in HS
Chapters 1 - 97 are subject to tariff rate quotas (TRQs), reflecting
sensitivities in Canada's agricultural sector. Information
explaining Canada’s TRQ system can be found on-line at: http://www.ccra-adrc.gc.ca/E/p
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Tariff Preferences
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By 1996, Canada had negotiated the following significant preferential trade agreements:
- the Canada-United States Free Trade Agreement; - the North American Free Trade Agreement; and - the Canada-Israel Free Trade Agreement.
Canada introduced its General Preferential Tariff (GPT) scheme for developing countries (including 15 APEC members) in 1974. Duty free entry was provided to all GPT-eligible products from the least-developed countries in 1983.
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Canada celecbrated its ten-year anniversary of the North American Free Trade Agreement (NAFTA) with the United States and Mexico in January 2004. Staged tariff reductions under NAFTA have been fully implemented; many ahead of schedule.
The Canada-Chile Free Trade Agreement came into force on July 1997. Canadian tariffs on most goods from Chile were eliminated at that time, with the last of staged tariff reductions were implemented in January 2003. Duty-free benefits were extended to a number of additional agricultural products in November 2003.
The Canada-Costa Rica Free Trade Agreement came into force on November 1, 2002.
The LDC product coverage was expanded twice; in August 2000 and again in January 2003. All imports from LDCs (except for dairy products, poultry and eggs) may now enter Canada duty and quota free. Canada also liberalized the origin requirements that apply to LDC imports, in 2000.
In April 2004, Canada passed legislation which extended the General Preferential Tariff (GPT) and Least Developed Country Tariff (LDCT) programs for an additional 10 years to 2014.
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Transparency of Tariff Regime, including Implementation of APEC Leaders’ Transparency Standards on Market Access*
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In February of 1994, the Government of Canada launched a comprehensive review of Canada’s tariff regime aimed at making Canada’s tariff system simpler, more transparent and predictable. As a result, on January 1, 1998, Canada’s new simplified Customs Tariff came into effect, systematically modifying Canada’s tariff structure and reducing tariff levels.
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The new Customs Tariff, which came into effect on January 1, 1998, introduced a number of liberalizing measures that are of benefit to international traders, including those from APEC economies.
Overall, the Canadian tariff system has become more simple, predictable, and transparent by replacing the existing seven tariff schedules with a single tariff schedule containing a simpler rate structure and significantly fewer provisions (about 8,000 compared to 11,000). The system was further simplified by eliminating or streamlining a significant number of legislative provisions and introducing a more flexible tariff schedule format (two tariff columns rather than five). Some of these measures have also broadened the scope of certain existing duty free provisions.
Canada provides annual updates of tariff and trade information to the WTO Integrated Database.
Current tariff
rates are available to the public in
viewing or downloadable format through the APEC
tariff database (http://www.apectariff.org/)
and on the Canada Customs and Revenue Agency’s website: http://www.cbsa-asfc.gc.ca/gen
See the tariff summary and dispersion tables at the end of this chapter, and in previous annual individual action plans, for more information.
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APEC INDIVIDUAL ACTION PLAN: TARIFF SUMMARY REPORT FOR {Year} |
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(PLEASE COMPLETE BOXES) |
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All Goods |
Agriculture excluding Fish |
Fish and Fish Products |
Petroleum Oils |
Wood, Pulp, Paper and Furniture |
Textiles and Clothing |
Leather, Rubber, Footwear and Travel Goods |
Metals |
Chemical & Photographic Supplies |
Transport Equipment |
Non-Electric Machinery |
Electric Machinery |
Mineral Products, Precious Stones & Metals |
Manufactured Articles, n.e.s |
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ITEM |
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Bound tariff lines as a percentage of all lines |
99.7% |
100.0% |
100.0% |
64.7% |
100.0% |
100.0% |
100.0% |
100.0% |
100.0% |
95.0% |
100.0 |
100.0% |
98.2% |
99.9% |
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Duty-free tariff lines as a percentage of all lines |
50% |
40% |
72% |
53% |
76% |
31% |
35% |
64% |
48% |
41% |
71% |
56% |
73% |
51% |
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Preferential tariff lines as a percentage of all lines (GPT) |
81% |
65% |
90% |
100% |
99% |
49% |
89% |
76% |
100% |
100% |
100% |
100% |
98% |
99% |
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Preferential tariff lines as a percentage of all lines (LDCT) |
99% |
93% |
100% |
100% |
100% |
100% |
100% |
100% |
100% |
100% |
100% |
100% |
100% |
100% |
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Ratio of tariff lines with quotas to all lines |
183:8531 |
183:1393 |
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Simple average bound tariff rate |
4.9% |
4.7% |
1.7% |
6.9% |
1.7% |
11.9% |
7.6% |
2.7% |
4.3% |
5.4% |
3.3% |
4.1% |
2.7% |
4.0% |
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Simple average applied tariff rate |
3.9% |
4.0% |
1.4% |
3.1% |
1.6% |
9.0% |
5.6% |
1.9% |
2.9% |
5.2% |
1.7% |
2.4% |
2.0% |
3.1% |
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Simple average applied preferential tariff rate - GPT |
1.3% |
1.5% |
0.7% |
0.0% |
0.6% |
3.4% |
1.9% |
1.0% |
1.2% |
3.9% |
0.2% |
0.7% |
0.5% |
1.0% |
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Simple average applied preferential tariff rate - LDCT |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
0.0% |
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Average applied tariff rate for all lines subject to duty |
8.3% |
8.7% |
5.1% |
6.5% |
7.2% |
13.1% |
8.6% |
5.2% |
5.6% |
8.9% |
5.7% |
5.4% |
7.2% |
6.4% |
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Import-weighted average applied tariff rate FOB |
0.9% |
1.5% |
0.3% |
0.0% |
0.7% |
8.6% |
4.5% |
0.6% |
4.8% |
0.8% |
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