Canada applies a 100% import tariff on electric vehicles from China

Canada is imposing a 100% tariff on all electric vehicles made in China starting October 1, 2024, in a move to protect its auto industry from unfair trade practices in China, aligning the policy with its US and EU allies that have hit and electric vehicle imports from China with import duties.

Chrystia Freeland, Canada’s deputy prime minister and finance minister, announced a series of measures on Monday to level the playing field for Canadian workers and allow Canada’s electric vehicle industry and steel and aluminum producers to compete in domestic markets , North American and global, Canada’s federal government said.

The government plans to implement a 100% surcharge on all electric vehicles made in China starting October 1, 2024. This includes electric cars and certain hybrid passenger cars, trucks, buses and delivery vans. This import tax will apply in addition to the 6.1% most-favoured-nation import tariff that currently applies to electric vehicles produced in China and imported into Canada.

The federal government also plans to impose a 25% tariff on imports of steel and aluminum products from China, effective October 15, 2024. The measure aims to protect Canadian workers “from China’s unfair trade policies and prevent trade diversion as a result of recent actions. taken by Canadian trading partners.”

In addition, the Government of Canada will launch a second 30-day consultation on other critical sectors, including batteries and battery components, semiconductors, solar products and critical minerals.

Canada is seeking to align its trade policy with that of the US and the EU, which have already announced tariffs on imports of electric vehicles made in China. The United States announced in May that it would raise tariffs on Chinese electric vehicles and certain hybrids to 100 percent, while the EU’s provisional tariffs took effect in early July.

As Canada and its industries and workers “face a deliberate, state-led 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 , to protect the Canadian. workers and matching measures taken by key trading partners,” Freeland said in a statement.

By Charles Kennedy for Oilprice.com

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