Evidence of meeting #82 for International Trade in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was companies.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Ethan Clarke  Vice-President, Canadian Freelance Union-Unifor
Mathew Wilson  Senior Vice-President, Canadian Manufacturers & Exporters
Toby Sanger  Senior Economist, Canadian Union of Public Employees
Nathalie Blais  Research Representative, Canadian Union of Public Employees
Victoria Lennox  Co-Founder and Chief Executive Officer, Startup Canada
Michael Holden  Chief Economist, Canadian Manufacturers & Exporters

October 23rd, 2017 / 3:30 p.m.

Liberal

The Chair Liberal Mark Eyking

Good afternoon, everybody. Welcome to our Standing Committee on International Trade. Today is the first day of our study on progressive Canadian enterprises and small and medium-sized enterprises through electronic commerce. We have four witnesses presenting today.

First, I would like to thank all of you for coming today on short notice. This study came forward only a week or so ago, and we appreciate that you were able to come here so soon. For anybody who has not presented before a committee before, we usually try to keep it to five minutes or under. We appreciate that. That gives us lots of time to have dialogue with the MPs afterwards. If for some reason you don't get all your thoughts forward, you can incorporate them as the dialogue goes on.

Without further ado, we're going to start with the Canadian Freelance Union, Unifor, with Ethan Clarke, vice-president.

Go ahead, sir, you have the floor.

3:30 p.m.

Ethan Clarke Vice-President, Canadian Freelance Union-Unifor

My name is Ethan Clarke. I am the vice-president of the Canadian Freelance Union.

We are a union of communications workers who have a freelance relationship with our employers or clients. Our union started as a response to the downsizing of newsrooms across the country about a decade ago. We are a community chapter of Unifor, the union. Unifor represents 310,000 workers across Canada, and specifically 12,000 journalists and media workers.

The composition of our community chapter is very diverse, including journalists, writers, editors, videographers, photographers, web designer developers, graphic designers, and translators. I, for example, run a company that builds websites. Our members are younger than the Canadian average, with more than 35% under the age of 44. Despite more than a half of our members having a higher education degree, a half of our membership earns less than $35,000 a year.

Our union has three main roles. First, we offer a break from the isolation inherent in the nature of our work.

Second, we offer services that would be hard for freelancers to access on their own. Health plans, contract dispute resolution, and contract templates are all services that we offer. Buying these services together means that we can do so at a much lower rate than if we were to try to access these services as individuals.

Finally, our union serves as a political voice for our members. We speak to those such as you, who have the ability to improve the lives of freelancers, about the changes that we need.

Working in the digital field means that our members are on the front lines of the transformations of many different industries. We're affected by the lack of regulation of the Canadian digital and online media sector leading to underfunding and an absence of good, stable jobs. We're affected by the fact that work in Canada is becoming more precarious. While some of our membership are freelancers by choice, the reality remains that many of them are freelancers because of the lack of good media jobs in Canada.

Our union, Unifor, has played a leading role in defining the new vision of NAFTA that works for Canadians. Just like trade more generally, e-commerce is not an end in itself. Trade is a means to a higher end, namely sustenance, economic security, and material prosperity.

From a labour perspective, the problem with Canada's current free trade regime is that it elevates capital above labour, privileges proprietors at the expense of workers, and strengthens the social position of business to the detriment of the public. Accordingly, any attempt to update our approach to e-commerce and trade should take account of the following principles, especially from a freelance worker's perspective.

There should be special attention to the production of local cultural content. Canada and the provinces must be free to regulate to ensure there is space for Canadian artists, creative professionals, and cultural producers. There should be extra care given to workers' rights and working conditions even for workers in freelance positions. Fair compensation, a safe work environment, paid time off, sick leave, overtime, secure retirement, these are some of the things that many Canadian workers enjoy as a consequence of generations of workplace struggle.

By freeing capital to move over national borders and by enhancing the power of investors generally, investor rights agreements like NAFTA pit workers in Canada with workers in the United States and Mexico. Any changes to e-commerce rules should not exert downward pressure on the quality of work life that Canadians enjoy. An improvement in the conditions and compensation of work should be understood as the goal to be pursued, not a threat to be neutralized.

There is a range of regulatory tools that can be used by the federal government to help grow, strengthen, and sustain Canadian content in the digital age. The first is to maintain and improve the current mix of tax and regulatory tools designed to promote and support Canadian content and ensure there are no more exceptions given to either foreign or Canadian online media services.

The second is Canadian content obligations for both foreign and domestic over-the-top television service providers. Streaming video companies like Netflix and Google are capturing a growing share of audiences and should deliver a commitment to Canadian content comparable to other existing services.

The third is a revenue levy on domestic ISP providers. A 5% levy on monthly Internet bills above $25 could inject more than $118 million annually to support the production of Canadian news and entertainment.

In conclusion, we hope that the committee will look at e-commerce as a way to elevate working conditions for freelancers and creative workers here in Canada. We believe that in e-commerce, and in trade agreements generally, our governments should maintain the ability to take action in support of Canadian culture and content. The absence of proper rules regulating the ability of companies in Canada to outsource work internationally would be detrimental to freelance workers, whose livelihoods depend on a strong, vibrant Canadian media, digital, and cultural sector.

I thank you for the opportunity to present here today, and I look forward to your questions.

3:35 p.m.

Liberal

The Chair Liberal Mark Eyking

Thank you, sir.

We're going to move over to the Canadian Manufacturers & Exporters. We have Mathew Wilson, senior vice-president; and Michael Holden, chief economist.

Thank you for coming, gentlemen. You have the floor.

3:35 p.m.

Mathew Wilson Senior Vice-President, Canadian Manufacturers & Exporters

Good afternoon, Mr. Chair and members of the committee.

Thank you for inviting us here today to speak on behalf of Canada's 90,000 manufacturers and exporters and our association's 2,500 direct members to discuss e-commerce and its impact and opportunities for Canadian SMEs.

Canadian Manufacturers & Exporters is Canada's largest industry and trade association, with offices in every province, and is the chair of the Canadian Manufacturing Coalition, which represents 55 sectoral manufacturing associations. More than 85% of our members are SMEs representing every industrial sector, every export sector, and all regions of the country.

Manufacturing is the single largest business sector in Canada. In Canada, manufacturing sales surpassed $600 billion in 2016 for the third consecutive year, directly accounting for over 11% of Canada's economic output, while employing more than 1.7 million Canadians directly in highly productive, value-added, high-paying jobs. Manufacturers are also directly responsible for the majority of Canada's exports. In 2015 and 2016 manufactured goods exports accounted for almost 70% of total Canadian exports. Nearly 80% of those exports go to our NAFTA partners.

While the sector is critical to Canada's current and future prosperity, manufacturing in Canada and around the world is going through tremendous changes, including major shifts in economic and market conditions, acceleration in the creation and adoption of new technologies, and changing political and policy priorities. In addition to these shifts, manufacturing itself has become much more globalized for production and customer bases, and the lines between manufacturing, services, and technologies are rapidly blurring. This is the challenge for manufacturers, as the production processes they use, the goods they produce, and the skills of their workforce are undergoing constant change.

However, these technologies are also providing new and significant opportunities. We see four core areas that are changing in manufacturing as a result of technology and e-commerce: retail consumer sales, B2B transactions, product design and commercialization, and production.

Retail consumer sales often get the most headlines and attention. Canadians are buying more and more of their goods online—everything from groceries to music to computers. From an SME business perspective, this provides great opportunities as well as challenges. Obviously it means that there is much more competition at home from retailers based all around the world and selling products through websites such as Amazon or eBay. But it also means that Canadian SMEs have access to billions of consumers around the world and the opportunity to dramatically increase sales and exports.

B2B transactions are not as well covered but are very similar to the retail environment. Companies today have access to a world of business partners who can provide them highly specialized services, technology, and equipment to help them grow. They are also faced with increased competition at home and abroad to sell similar services. Companies like Amazon are now looking at setting up exclusive B2B portals to mirror the consumer retail sales sites. Leveraging e-commerce sales, including through platforms like these, is becoming a requirement for participating in global value chains.

The third area where e-commerce is having a potential impact is around product design and commercialization. Companies today are leveraging technologies to create new innovative products and processes through real-time, multi-location research and design and testing. These technologies are rapidly speeding up time for product development and time to market for new products. Access to e-commerce platforms makes it cheaper and easier to learn about and purchase these technologies from both domestic and overseas suppliers.

The final area of note for manufacturers and exporters is on process control. Today technology allows a company, or a service provider, to operate an entire plant and all the machinery and equipment within it from anywhere in the world. Some companies are working toward complete automation of production in this manner to reduce the cost of production labour to shift those resources to higher skill, higher value-added activities, such as R and D.

Overarching all these issues is Canada's ongoing challenge with productivity and competitiveness. Because of declining business investment, skills shortages, a poor record on innovation and commercialization, and a range of other issues, Canadian manufacturers are struggling to compete globally.

E-commerce and online trade offer a potential solution. Studies show that companies that shift toward greater online sales enjoy significant production gains as a result. But there is a catch-22 here. To be successful at leveraging e-commerce opportunities, our businesses will have to be as competitive as possible. In other words, we need to improve our productivity in order to realize potential gains from e-commerce.

With all these changes and challenges, companies are, frankly, struggling to keep up and remain globally competitive. At the same time, these changes are providing massive new opportunities, but they cannot take advantage of them without a better, more modern framework. Some of the most critical issues are as follows.

First, companies need to invest in more advanced technologies to take advantage of the e-commerce opportunities, yet in Canada our investment levels in new technologies continue to fall behind those of international competitors. U.S. manufacturers, for example, invest more than eight times the amount of a similar size Canadian manufacturer. The government must do more to help companies invest in technologies and software, including through enhanced depreciation rates through the ACCA program.

Second, Canada needs to have better digital infrastructure. It is often too expensive and not up to necessary speeds for modern manufacturing to operate in a digital e-commerce world. We cannot stress this issue enough. Internet data and mobile phone fees are among the very highest in the industrialized world. Our businesses cannot hope to be competitive for as long as that remains true.

Third, free trade agreements must be modernized to include digital trade and e-commerce protocols. The TPP, which is being relaunched without the U.S., has a chapter on these issues that is supported broadly by industry. This chapter should be made part of the modernized NAFTA and other FTAs moving forward to provide stronger trade protections for SMEs and secure flow of data.

Fourth, SMEs need help in understanding the opportunities that e-commerce provides both at home and abroad, and should be encouraged to participate both in B2B and B2C activities.

Finally, Canada should do a better job in promoting goods that are designed, engineered, and made in Canada. Our products and technologies are world class, and consumers around the world will buy them if they know about them. We need a “made in Canada” branding program that can be used to promote Canadian-made goods to consumers both at home and abroad.

Thank you again for inviting us here today. I look forward to the discussion.

3:40 p.m.

Liberal

The Chair Liberal Mark Eyking

Thank you, gentlemen.

We're going to move on to the Canadian Union of Public Employees. We have two people with us today. We have Toby Sanger, senior economist; and Nathalie Blais, the research representative.

Welcome, and you have the floor.

3:40 p.m.

Toby Sanger Senior Economist, Canadian Union of Public Employees

Thanks very much for the opportunity to discuss this very important issue.

We've been concerned about the taxation of e-commerce for many years because of its impact on our members with significant job loss in the media industry, and its impact on the broader economy, our social and culture life, and also on our democracy.

Foreign producers are not required to collect sales taxes on digital products or services imported into Canada if they aren't considered to be carrying on business here. This creates a very significant bias against Canadian producers. Not only are our governments losing out on significant revenues, but we're suffering economically and culturally, with a loss of jobs, main street businesses, and a weakening of our media. As e-commerce becomes more pervasive in many different sectors and results in greater concentration and monopolization, these problems are growing exponentially.

The OECD highlighted taxation of the digital economy as action number one in its major 2015 base erosion and profit shifting, or BEPS, plan. Canada is now one of a few major countries around the world that hasn't introduced changes to require foreign-based digital businesses to collect and remit sales taxes.

There's no reason why we can't move forward on this. We should also strongly resist pressure to increase the NAFTA de minimis threshold for imports from $20 to $200 or $800. I know you've discussed this issue.

In my 25 years of involvement in tax policy, this issue of taxation of e-commerce or foreign digital services is one of the clearest no-brainers, in my opinion. It involves removing a tax bias against domestic producers, who are also often small and medium-sized enterprises. If the federal government really wants to do something positive on taxation for small business, which has been such an issue in the news recently, this should be its top priority. I hope we'll see some action on this in the fall economic statement tomorrow.

Nathalie Blais, my colleague, is now going to talk a little more about this issue in French.

3:45 p.m.

Nathalie Blais Research Representative, Canadian Union of Public Employees

The Canadian Union of Public Employees, or CUPE for short, represents 7,500 members in the media and telecommunications industry, which has been going through constant upheaval for more than 20 years, with the dematerialization of content, the advent of the Internet and e-commerce, and changing consumer habits. All of these phenomena have thrown the country's culture and communications ecosystem profoundly off balance, and legislation ill adapted to today's digital landscape has only exacerbated that imbalance.

To support Canadian businesses who do business on the web, the government needs to make foreign companies selling products and services on the Internet in Canada pay their fair share in taxes. The current legislation must therefore be adapted to reflect the new digital reality, so that it no longer puts foreign multinationals such as Google, Facebook, Netflix, and Spotify at an advantage.

The Standing Committee on Canadian Heritage recognized that lack of fairness in its June report on media and local communities, recommending that the government level the playing field among industries on all platforms. The culture and communications industry is unanimous on the need for legislative change so that Canadian companies can compete on a level playing field in a global marketplace made possible by the Internet.

CUPE is part of the Coalition for Culture and Media, whose 40 member organizations, endorsed by over 4,000 citizens and groups, are calling on the government to restore tax fairness. Time is of the essence: some of our locals have already lost jobs, and more losses are on the way if immediate action isn't taken.

Thank you.

We'd be happy to answer any questions you may have.

3:45 p.m.

Liberal

The Chair Liberal Mark Eyking

Thank you.

We're going to move to Startup Canada, with Victoria Lennox.

Thank you for coming. Go ahead.

3:45 p.m.

Victoria Lennox Co-Founder and Chief Executive Officer, Startup Canada

Thank you for having me.

My name's Victoria Lennox. I'm the co-founder and CEO of Startup Canada. Startup Canada started in 2012 to unite Canada's entrepreneurship community. We now have over 200,000 entrepreneurs in our network, covering more than 50 start-up communities in 100 towns, cities, and villages across Canada. Our whole goal is to create a Canada for entrepreneurs to build an environment and culture for entrepreneurial success and to connect entrepreneurs to decision-makers so that, together, we can build an innovation nation and make Canada a beacon for entrepreneurship globally.

We're very excited to be here today and to begin to contribute to this conversation. I see it as just the beginning. Thank you to those of you who participated during Small Business Week last week with Startup Canada down on the Hill, where we had 2,000 entrepreneurs come to the capital. Thank you for hearing their voices.

This is a really exciting topic. It's all about e-commerce and Canadian businesses online, and when you connect it with trade, there's huge opportunity for Canada's entrepreneurship community. More than anything, Startup Canada is here for every entrepreneur—2.3 million entrepreneurs in Canada. We know that we're investing in superclusters as a nation, but we also know that e-commerce is a great equalizer for every entrepreneur, particularly when we have high-speed broadband access so that every entrepreneur in the north and rural and remote communities and indigenous communities can have access to a global market. Startup Canada and our entrepreneurs believe e-commerce is a fantastic equalizer and creates a more accessible economy for every entrepreneur.

In terms of Startup Canada and what our entrepreneurs are looking for when we start to look at e-commerce as well as its interconnection with trade, it is how it connects with culture, and how, when we're bidding for Amazon and Facebook and working with our Shopify colleagues, we're empowering our entrepreneurs through e-commerce to access global markets.

We're starting to see a bit of a skills gap, and I'll speak to a number of studies that we've recently conducted and launched. In addition, we're having a difficult time with digital adoption, particularly amongst our senior entrepreneurs, and the opportunity for cross-mentorship when connecting with trade commissioner services to see what resources are available, particularly for online companies, and really creating those growth opportunities that we can build into our bids for major multinationals as they look to position themselves in our cities.

Ultimately, our entrepreneurs are looking for Canada to have a culture of entrepreneurship, to be connected to the support that they're looking for, and to have supportive communities, but they're also looking for customers. How can we build our entrepreneurs and e-commerce start-ups into the global supply chain?

At Startup Canada, our stats on the topic are a little different from those of other organizations. Our entrepreneurs are predisposed to start up online. The majority—93%—of our entrepreneurs at Startup Canada have an online presence. As the world's economy moves to digital first, Canada needs to ensure that all enterprises, regardless of size, industry, or sector, are supported with the tools, resources, and policy environment to benefit from electronic international trade. We need to be thinking beyond looking at our trade infrastructure for large companies. Our start-ups are starting globally from day one. They're competing with some of the best of the best. Therefore, how is our infrastructure set up to help accelerate entrepreneurs?

A lot of my comments are related to the trade commissioner services. I'll make a few key notes. SAAS, or software as a service, companies in Canada are the high-growth companies that are disproportionately creating the jobs in Canada. What we're starting to see, which is really cool, is that 64% of our SAAS companies at Startup Canada have actually begun.... They're socializing it to create global expansion officer roles in their C-suite executive suite. If we're seeing that our SAAS companies are looking globally and starting global, scalable companies, and they're starting to increasingly employ chief global officers, that's a really exciting sign.

Seventy-four per cent of our SBOs use digital technology, including software programs and mobile applications; however, women are 20% less likely to adopt new technologies than men in the Startup Canada network. Immigrant entrepreneurs are twice as likely to integrate digital technologies into their companies than those born in Canada.

Forty-four per cent of small business owners at Startup Canada say that the high cost associated with researching, integrating, and maintaining digital technologies is the main barrier to technology adoption. Seventy-three per cent of small business owners list digital skills amongst their top three priorities. Twenty-nine per cent of Canadian small business owners do not believe the current workforce possesses the right digital skills to start and grow their companies.

What can we do together? First, we have to get every business in Canada online, and we need them to see the opportunity in building up their e-commerce presence. The tools exist. They are free and they are available, so it's about education and connecting entrepreneurs with the resources they need.

We need to invest in digital skills and in supporting every entrepreneur, not just those based in the major cities in Canada but across Canada. What's really cool is that we can do this digitally with just-in-time training.

We also need to bridge the gap between the services available through the trade commissioner service and Export Development Canada to the entrepreneurs and meet them where they are at so that we can take entrepreneurs on that journey from starting up their e-commerce company to scaling to global markets with a seamless pipeline that can help to accelerate Canada's entrepreneurial success.

The Canadian trade accelerators across the world are some of the best models in the world at how to do it right and how Canada can lead. As we continue to scale our Canadian tech accelerators, both in the U.S. and globally, there's an opportunity to look at e-commerce and specialize one of the key pillars to help our companies in that area.

Ultimately, we need to make sure that Canada stays competitive. We need to reduce the internal trade barriers we have as a nation. We need to make sure our tax, other infrastructure, and regulatory systems are conducive to scaling great entrepreneurs. Remember, the Government of Canada can be one of the best buyers of new business products and services, so we need to get behind our companies.

Just in closing and echoing my colleagues' remarks, we really need to brand Canada as an innovation nation. We need to make Canada best in class as it relates to entrepreneurship. We need to attract the best entrepreneurs, investors, and multinationals to our country, and we need to do it now. Our regulatory and tax systems will be important to attracting the best and brightest to Canada.

Thank you for the opportunity.

3:50 p.m.

Liberal

The Chair Liberal Mark Eyking

Thank you, Ms. Lennox.

That's a good segue into our dialogue with the MPs here. Without further ado, we're going to get going right off the bat.

We have the Conservatives up first.

Mr. Carrie, you have the floor for five minutes.

3:50 p.m.

Conservative

Colin Carrie Conservative Oshawa, ON

Thank you very much, Mr. Chair.

Thank you to the witnesses for being here today on such short notice on such an important topic.

I thought I would start with Mr. Wilson.

As you know, I'm the Oshawa MP, and we have a lot of manufacturing. You mentioned some things about how we really have to look at how this affects competition. I think you said B2B portals, product design, and plant operations.

One of the things you said that concerned me was about the investment in advanced technologies. The U.S.A. invests eight times more than Canada. What I'm hearing from our manufacturers is that government policies, especially in Ontario with, as you know, the high cost of electricity and the uncertainty of carbon taxes and how these are going to play out, are really affecting our international competitiveness, especially with the United States.

Can you expand on whether e-commerce will help or hinder Canada's domestic and global competitiveness? How do you see that rolling out? It seems to be the future.

3:55 p.m.

Senior Vice-President, Canadian Manufacturers & Exporters

Mathew Wilson

E-commerce is just another tool to sell things. I believe this is what Ethan said as well. In and of itself, it won't help or hinder. I guess a big part of our point was that, if other things aren't aligned, it doesn't really matter. You're going to miss out on the opportunities that e-commerce does provide.

The real opportunity is that you have access to consumers and business partners from all around the world that 15 years ago you would have had a hard time finding. Today the online community is massive and you have the ability to access it, but without the government policies in place....

You mentioned electricity rates, but it's not just electricity rates in Ontario. It ranges from bad regulatory policy or red tape that adds cost to municipal tax rates and levies that go on at that level, up to international tariffs. A bit of everything combines into that kind of business environment that impacts the business investment decisions that companies are making.

It's a wide-ranging problem, and it's a major problem. When we talk to our members about what their number one issue is, it is skills followed almost immediately by bad government policy. It's not a political thing at all. It's across the board everywhere in the country and with every type of government imaginable.

They have a problem with the way governments tend to treat business. It's as an afterthought rather than as a contributor, and something we try to get across to all governments at all levels is that industry is there as a contributor, a supporter, a partner of government to grow the economy and create new jobs. It's not there to do other things that sometimes you get blamed for doing.

3:55 p.m.

Conservative

Colin Carrie Conservative Oshawa, ON

What advice can you give the government in terms of what needs to align? You mentioned the red tape. I think Ms. Lennox talked along the lines of regulations and taxes.

What advice can you give us here at our committee about action that needs to be taken fairly promptly, or else we may miss out on this great opportunity?

3:55 p.m.

Senior Vice-President, Canadian Manufacturers & Exporters

Mathew Wilson

I think there are a number of things. You mentioned taxes and regulations. Just from a regulatory perspective in Canada, we seem to do everything imaginable to make regulations as complex as possible. Bureaucrats are excellent at creating new regulations that everyone has to follow, in our individual personal lives as well as our businesses. Some of them are helpful and can be constructive. A lot of other ones are restrictive and not pro-growth. We have put forward, for example, a regulatory bill of rights that we're pushing for government to adopt. It creates more transparency and more openness in the regulatory process. It looks at outcomes and not just the steps to get to those outcomes, which regulations often focus on.

I think a number of things could be done from a cost input perspective. We need to look at things like electricity costs. I saw a study—from an automotive producer in your riding—that had a comparison chart of automotive assembly plants across North America in terms of electricity prices. In Ontario they're four times those of their U.S. competitors. That is going to drive investment out of the country.

It's not just one thing. My colleague Mike likes to call it “death by a million paper cuts”, and that's really what it is. It's a whole bunch of really small things that add up to a really big problem. It's not one government or one political party. It's a cumulative effort over time that's having this effect.

3:55 p.m.

Conservative

Colin Carrie Conservative Oshawa, ON

How do you see this with the discussions we're having on NAFTA right now, in terms of the importance of it for...? To my understanding, for example, your organization is very supportive of NAFTA. With some of the challenges that are coming forward, how do you think we—

3:55 p.m.

Liberal

The Chair Liberal Mark Eyking

I'm sorry, Mr. Carrie, but we have a problem. You have five seconds left.

It sounds like a really good question, and I think they're ready to go, but maybe your colleague could....

3:55 p.m.

Conservative

Colin Carrie Conservative Oshawa, ON

It was brilliant.

3:55 p.m.

Voices

Oh, oh!

3:55 p.m.

Liberal

The Chair Liberal Mark Eyking

I wouldn't want to cut them off on a good answer, so we'll just move on to the Liberals.

Ms. Ludwig, you have the floor.

4 p.m.

Liberal

Karen Ludwig Liberal New Brunswick Southwest, NB

Thank you.

I'll jump right in there. Certainly, regarding NAFTA, we've heard President Trump stress the wish to increase the limit that a Canadian can bring in through e-commerce, from $20 to $800 Canadian, which is well over $1,000 U.S.

I'm wondering, Mr. Wilson, what impact that might have on Canadian businesses.

Then I'd like to follow up with Ms. Lennox in terms of small businesses as well.

Thank you.

4 p.m.

Senior Vice-President, Canadian Manufacturers & Exporters

Mathew Wilson

We didn't mention it in our statements today, but we have in the past pushed for higher limits. I mean, $800 is.... I don't really know what the number is, but $20 is just ridiculously low, in our opinion.

4 p.m.

Liberal

Karen Ludwig Liberal New Brunswick Southwest, NB

But you had a number, did you?

4 p.m.

Senior Vice-President, Canadian Manufacturers & Exporters

Mathew Wilson

We had put $200 because that's the personal exemption. If you or I travel across the border for 48 hours, that's what we can bring back. We think it's a reasonable number and in line with what an individual can do but a business can't do.

Nothing is bought for $20 today. It was set in the 1980s. I think in the early 1990s it was changed to $20. We're just out of step globally. I think an increase is merited. As to unlimited numbers like $1,000 or $800, I actually don't know what the impact would be. It just shouldn't be.... Even if it were kept up to inflation, I think it would be $45 today, which would be a lot better than the $20 that it is.

We have pushed $200 in the past to align it with personal exemptions.

4 p.m.

Liberal

Karen Ludwig Liberal New Brunswick Southwest, NB

Thank you.

Ms. Lennox.

4 p.m.

Co-Founder and Chief Executive Officer, Startup Canada

Victoria Lennox

Similarly, I don't have any numbers on it, but I have some examples. I think increasing the threshold will definitely increase the competitiveness of our companies, but the entrepreneurs right now are finding ways around it. They work with some of the UPS stores and Amazon warehouses in order to go across the border and have everything shipped to the U.S. Then they drive over with their families and their colleagues or whatever they need to do.

Even so, I'm not sure what the impact will be, but certainly anything we can do to open up our borders and make it easier to do commerce with the United States would certainly help our small businesses to scale.