Last-minute changes in USMCA keeps lid on e-com

18 Oct '18
2 min read

Eleventh hour changes to a new trade deal torpedoed US hopes of making Canada and Mexico allow higher-value shipments by online retailers, according to Mexico’s economy minister Ildefonso Guajardo. The pact was set to double the value of goods that could be imported without customs duties or taxes from the United States through shipping companies to Mexico.

But as Canada adopted a more restrictive threshold during its efforts to salvage the trilateral deal, Mexican negotiators followed Canada’s lead, global news wires quoted Guajardo as saying.

The final version of the agreement will protect retailers in both countries from facing greater competition from e-commerce companies.

In the new deal, called the United States-Mexico-Canada Agreement (USMCA), US negotiators originally pushed the other two countries to raise import limits to the US level of $800 from current thresholds of $50 and C$20 respectively, which Mexican retailers opposed fearing online companies would sell cheap imports from Asia through the United States.

Guajardo said Canada, after Mexico had finished negotiations, set its sales tax exemption at just C$40, about $30, and put a ceiling of C$150, about $117, on custom duties exemptions.

The Retail Council of Canada said the deal will protect retailers against a ‘massive change in the competitive landscape’. (DS)

Fibre2Fashion News Desk – India

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