March 4, 2010 / 9:12 PM / 9 years ago

Canada to scrap tariffs on manufacturing inputs

 OTTAWA, March 4 (Reuters) -  Canada's Conservative
government pledged on Thursday to become the first G20 country
to permanently eliminate all import tariffs on inputs for
manufacturers by 2015, and most cuts will take effect
The  tariff cuts on things like raw materials will save
companies about C$300 million ($290 million) in a unilateral
move that Ottawa sees as one of the boldest measures in its 2010
 "Canada, as a nation whose prosperity is greatly dependent
on trade, clearly understands the importance of open markets,"
the budget said.
 Business investment has lagged in Canada despite a tariff
cut in last year's budget on imports of machinery and equipment.
 Companies held back from new investments in the fourth
quarter, according to Statistics Canada data that showed
surprisingly strong quarterly growth of 5 percent, annualized.
 The new measures will reduce the number of items subject to
import duties ranging from 2 percent to 15.5 percent to 381
items from 1,541 items as of March 5, and that number will fall
to zero by 2015.
 At that time, the only imports subject to duties in Canada
will be supply managed goods in the agricultural sector and
consumer products.
 The government said its pre-budget consultations showed that
small and mid-sized businesses were enthusiastic about the
tariff cuts, which will cut costs and paperwork.
($1 = $1.03 Canadian)
 (Reporting by Louise Egan, editing by Janet Guttsman)

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