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This is Canada. It is an election year. Canadians do not like to pay tax. They blame the government when they do.
Connect the dots
"he'd raise the Import threshold from $20 to $100"
Not a smart political move. It would offend small businesses and retailers putting them in an unfair uncompetitive position versus American retailers and mail order businesses. The result may be layoffs in Canada. As a federal politician, you do not want to do that in an election year as it could be political suicide.
It is much easier to quietly let things slide while nobody pays attention.
"business owners don't lose a dime because of my online shopping habits"
Sometimes it is best to look at the big picture, involving 35,000,000 Canadians.
If a Canadian in Ontario (for example) can purchase an item for $50 online from a Canada supplier or an American supplier, there are basically two options:
1) buy from the Canadian supplier and pay 13% tax
2) buy from an American supplier and pay no tax (should the postal import exemption be increased to $100)
We know that postage cost from the USA to Canada are generally even cheaper than domestic rates for parcels so shipping charge in many instances should not be a factor.
For the government to encourage Canadian consumers to purchase outside the country for the purpose of not paying taxes in this country seems wrong to me.
Money does not grow on trees in this country. The results can only be one of two things:
1) less tax collection (GST/HST) on imports results in fewer services provided by provincial and federal government
2) less tax collection (GST/HST) on imports results in the shortfall being paid by increased income or other taxes
In addition profits made by American suppliers are not taxed in Canada. The tax goes to the State and American federal governments and whatever labour is used in those millions of transactions is earning wages and paying associated taxes in the USA, not in Canada.
I do not see any real benefits, do you?
"The average Canadian buying online does not look at the "big picture"."
I totally agree with you. Most individuals try to find "what's in it for me?"
However, a government should look at the "big picture" today and how changes may affect tomorrow.
On October 8th 2014, Stats Canada published an excellent analysis of cross border shopping and imports by mail and courier. Since it takes quite some time to acquire and analyze the numbers, data is for 2012.
A few points to keep in mind:
1) total retail sales in Canada (one of the largest sector of the economy): $468 billion dollars
2) Goods imported into Canada from abroad by post and courier: $3.1 billion dollars (growing quickly and representing an increase of 50% from 2006)
http://www.statcan.gc.ca/daily-quotidien/141008/dq141008a-eng.htm
While goods imported by mail and courier still represent a very small fraction of the overall retail business, I do not see why the government should do anything to encourage its growth if it means lowering tax revenues and less sales for Canadian retailers.
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