| tool001 | 04-25-2012 12:09 PM |
wasn't duty (concept) was so that people purchase canadian goods? if so, i dont see the point of paying duty for good that are not even produced in Canada. (a little off topic, as you are required to disclose total value, and if ur bringing anything over 10k) Quote:
Canadian shoppers pay more for products because suppliers charge Canadian retailers more – between 10-50 per cent more – a senate committee was told Tuesday morning.
“Retailers play a very small part in determining final prices of goods they sell,” Diane Brisebois, CEO and president of the Retail Council of Canada (RCC), told a Senate Committee on National Finance on Tuesday morning.
The Senate committee began looking into pricing in October, following complaints from consumers tired of paying more in Canada for the same products sold in the U.S. The two currencies have been trading roughly at par for years.
There was more bad news for Canadian retailers on Tuesday: Retail sales unexpectedly fell for the first time in seven months in February, led by a decline in purchases of new cars, according to Statistics Canada.
And a survey from the Conference Board of Canada found that Canadians remained cautious about making large purchases in April. After three consecutive months of increases, the index fell to 75 in April, down 4.5 percentage points from a surprisingly positive March.
It all adds up to a tough 2012 for Canadian retailers, who are not optimistic about sales growth this year, according to the report from the RCC presented to the senate committee in Ottawa.
A survey of the 70 biggest RCC members found most expect growth of two to three per cent this year. With inflation expected to be in the two per cent range, the growth in actual volume of sales would be minimal.
The report gave examples of items sold by suppliers at different price points in Canada and the U.S.
Ibuprophen 200 mg, sells to U.S. retailers for $10.76 and to Canadian retailers for $18.29, a difference of 70 per cent. A bottle of Aspirin 81 mg low dose sells to U.S. retailers for $10.16, and to Canadian retailers for $21.78, a difference of 114 per cent.
Canadian retailers say their suppliers tell them they charge more because Canadians are used to paying more for products in Canada; because the higher prices subsidize the costs of maintaining offices and operations in Canada, and because they have to compensate their Canadian distributors and wholesalers.
The RCC report also blamed tariffs on finished goods like some clothes, pantyhose, wooden bedroom furniture, bed linens, towels and pillows, for putting Canadian retailers at a competitive disadvantage with their U.S. peers.
The report called books the “poster children” of the price differences. Canada’s own copyright regulations allow for a 10 per cent markup on U.S.-sourced books and the tax has been collected by multinational book distributors since 1999, it alleges.
The recent increase in personal exemption limits for Canadians travelling outside the country will also hurt retailers at home and ultimately, the Canadian economy, the report says.
February saw an 8 per cent increase in same-day car travel by Canadians to the United States, to 2.6 million trips, the highest monthly level since December 1997.
The RCC also cited supply management for the high prices for eggs, chicken, butter and milk in Canada, which sends residents of border towns to the U.S. for groceries.
“It is the RCC’s position that the government should not favour one industry over another, in this case farmers over retailers, to the detriment of the latter,” it concluded.
Bill Mitchell, spokesperson for the Dairy Farmers of Ontario, said the idea that the marketing boards are responsible for the price difference in milk between Canada and the U.S. is false.
Border towns keep the price of milk artificially low to draw shoppers from Canada. Farms in the U.S. get federal and state subsidies that keep prices artificially low.
“We hope that the material we provided will help to set the record straight as to the real reasons behind the differences in pricing between Canada and the United States,” said Karen Proud, VP, federal government relations at the RCC.
The retail sector is the largest employer in Canada, providing jobs for more than 2 million Canadian and generating sales in excess of $300 billion dollars a year. It contributed $74.2 billion to Canada’s gross domestic product (GDP) in 2009.
The RCC represents more than 45,000 stores of all retail formats across Canada.
| Shopping for fairness: Why Canadians pay more for everything - thestar.com |
