Canada is imposing a 100% tariff on all China-made electric vehicles effective October 1, 2024, in a move to protect its auto industry from unfair Chinese trade practices, aligning policy with its U.S. and EU allies that have also hit Chinese EV imports with import duties.
Chrystia Freeland, Canada's Deputy Prime Minister and Minister of Finance, announced on Monday a series of measures to level the playing field for Canadian workers and allow Canada's EV industry and steel and aluminum producers to compete in domestic, North American, and global markets, the federal government of Canada said.
The government plans to implement a 100% surtax on all Chinese-made EVs, effective October 1, 2024. This includes electric and certain hybrid passenger automobiles, trucks, buses, and delivery vans. This import duty will apply in addition to the Most-Favoured Nation import tariff of 6.1% that currently applies to EVs produced in China and imported into Canada.
The federal government also intends to apply a 25% tariff on imports of steel and aluminum products from China, effective October 15, 2024. The move is aimed at protecting Canada's workers "from China's unfair trade policies and to prevent trade diversion resulting from recent actions taken by Canadian trading partners."
In addition, Canada's government will launch a second 30-day consultation concerning other critical sectors, including batteries and battery parts, semiconductors, solar products, and critical minerals.
Canada is looking to align its trade policy with that of the U.S. and the EU which have already announced tariffs on imports of China-made EVs. The United States announced in May that it would increase tariffs on Chinese EVs and certain hybrids to 100%, while the EU's provisional tariffs came into effect in early July.
As Canada and its industries and workers "are facing an intentional, state-directed policy of overcapacity, undermining Canada's ability to compete in domestic and global markets", the federal government "is moving forward with decisive action to level the playing field, protect Canadian workers, and match measures taken by key trading partners," Freeland said in a statement.
By Charles Kennedy for Oilprice.com
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