An American proposal to hike the fees Canadian truckers pay for agricultural inspections when they cross the U.S. border violates the North American free trade agreement, the Canadian Trucking Alliance says.
The industry group says the U.S. Department of Agriculture’s proposed fee increases, which would fund increased inspections and be charged even to trucks carrying no food, plants or livestock, would harm U.S.-Canada trade as well as the bottom lines of trucking businesses, big and small.
“They claim it is to protect the domestic food supply and the domestic agricultural industry, but then they assess the fees on every truck that crosses Canada-U.S. border,” said David Bradley, president of the CTA. “So a truck hauling auto parts on plastic pallets pays the fee and has nothing to do with agricultural products.”
In a submission to the U.S. Department of Agriculture, the Canadian government says it agrees the fee increase “may not be consistent with U.S. international trade obligations” and “would have disproportionate and negative effects on Canadian commercial enterprises exporting to the United States.”
With 60 per cent of Canadian goods flowing over the border by truck, the Canadian government says its analysis shows that U.S. imports from the rest of the world would drop by $116-million (U.S.) a year while those from Canada would drop by $31.8-million.
That is a small chunk of the $152-billion in exports trucked from Canada to the U.S. last year. But the government also estimates that the Canadian trucking industry could end up paying as much as $15.5-million a year in new fees.
The Department of Agriculture’s Animal Plant and Health Inspection Service says its proposed fee hikes would see commercial trucks now crossing the border using $105-a-year transponders pay $320 a year. Trucks without the transponders and paying at each crossing would see their fees hiked to $8 from $5.25 per crossing.
U.S. officials say the fee increases will cover the costs of inspections aimed at keeping “foreign pests” that could infest crops or livestock out of the United States, a job made more expensive by the increased flow of goods from all over the world. The Department of Agriculture also says that some fees, such as those for airline passengers and railway cars, will go down, as the changes are meant to reflect the different costs of inspecting each mode of transportation.
The Canadian Trucking Alliance successfully opposed a U.S. proposal to charge truckers new customs fees back in 1999. And Mr. Bradley says the CTA has a legal opinion from Gowling Lafleur Henderson LLP that describes the latest proposed fee increase as a “disguised restriction on trade” that violates both NAFTA and rules under the global General Agreement on Tariffs and Trade that restrict fees at the border.