Conference highlights N.D.-Canadian trade
October 5, 2012 at 1:00 am in Grand Forks Herald
UND, the state Chamber of Commerce, state Trade Office and the Grand Forks Region Economic Development Corp. are also presenting the conference, called “Beyond the Border Action Plans: What do they mean for North Dakota?” at 2 p.m. at the Alerus Center. Continue Reading
GF is in a unique situation along with only 3 other US cities. There are only 4 large Canadian cities that are directly north of an American city that acts as a destination for Canadian consumers. They are 1. Vancouver/Seattle, 2. Winnipeg/Grand Forks, 3. Windsor,Ont./Detroit & 4. Niagra Falls,Ont./Buffalo,NY. Because of Canada’s value added tax system(VAT) people in those Canadian cities travel to these 4 US cities to shop. These are the only 4 locations on the US-Canada border where cities are close enough to create significant travel by consumers from Canada. There are no cities to the south of Calgary, Alberta, e.g., in Montana to create the same sort of destination that GF is. Thunder Bay in Ont. is too far from Duluth for it to represent a significant destination for shopping. Detroit is the next city to the east in MIch. that is close to Canadian consumers across the Detroit R. in Windsor with Buffalo being the next in NY across from Niagra Falls Ont. Of course the 3 of the 4 largest places mentioned would dwarf Winnipeg/GF in terms of VAT $ streaming south from Canada but for GF it is huge as we know. GF would rank 4th in consumer trade among these 4 cities & is also the further south from Winnipeg than these other cities are from their Canadian shoppers. I’m sure this is the reason that 10 yrs. ago national consultants identified GF’s potential as a destination city because of the significance for shopping $ from Manitoba’s VAT. Of course Fargo @ 3 hrs. from Winnipeg isn’t so far that it isn’t benefiting too.
Canada uses its VAT to finance its national healthcare & education systems. Since these industries will not be nationalizing in the US for the forseeable future GF will continue to reap the rewards of having enough shopping/hotel infrastructure in place to service Canadians. Anything that is considered a luxury in Canada is subject to an added tax, from fur coats to duck decoys & books, the list is as long as your arm.
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Obviously, the migration south is heavily influenced by the exchange rate. For sometime it’s been around par. A few years ago, when the C$ was at .62, the Canadian presence dried up, despite the tax savings.
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Did it actually dry up? Not living there I didn’t hear about that but whenever I visited during that time the Canadians still seemed very visible.
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There may have individual families still coming down, but at .62 there wasn’t a Grey Goose bus to be seen.
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I saw as many Manitoba family cars in GF parking lots 25 yrs. ago as I do now. In fact it has always been cars that have been most visible.
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The combined sales taxes levied by provincial & the Feds. = 12%. I wonder how much more products cost in Canada before the 12% tax. Likely they are more expensive.
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Their products are likely more expensive because they are imported in many cases.
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As I understand it many Canadians come to GF to buy cars.
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It could be that cars are considered a luxury when mass transit is available.
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The VAT is 5% while the provincial tax is 7% =12%
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Let’s say the average product in Canada costs the same since Canadian $ are now on par with US $. Does that mean that the product actually costs the same in Canada?
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Why don’t you visit and find out for yourself?
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Thanks for the advice Alan.
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Let’s look @
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this a bit closer.
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OK
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LOL. Hard to get a conversation going when you’re talking to yourself, but nice try.
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It should be noted here that it would be pretty darn hard to find a Canadian who would know what Spearman was talking about when he says VAT. EH? VAT??? Oh…..you mean the GST…..now I gotcha! Calling the GST a VAT is attempting to put a European spin on the subject. I have NEVER heard ANYONE where I live in Canada for 1/2 the year call the GST anything but the GST. VAT. Something you cook lutefisk in, right?
Or how about this: VAT you talkin about, Spearman?? And Canadian buying cars in the U.S.? Yes, I’ve heard of people doing that where I live…..but it is usually someone who doesn’t mind having to pay that VAT….er….GST when you bring the car across the border. Then you have to pay the PST…or provincial sales tax too when you buy your plate for the car. So you’re really not saving anything. Oh…and if you buy a new car in the U.S., it is very possible that the Canadian dealer of the same car would not honour (honor) the warrantee. I know the reverse is true. The new car we are driving right now has only a Canadian warrantee. If we have warrantee work done on it in the U.S. we have to pay for it, OR purchase the U.S. warrantee to be covered here. VAT you say? It’s true.
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Alan, you had to find something to criticize? Anyway, living 400 mi. from Manitoba means I can’t get there anytime soon so thought I’d see if anyone knows what it si besides the GST that makes purchases attractive for Canadians shopping in GF. If the GST is only 5% & the PST 7% then is it there a higher product cost in Canada to begin with?
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Spearman….didn’t know you were such a sensitive guy! Sorry for hurting your feelings! VAT the heck!!! PST & GST are a fact of life in Canada, and the people have accepted that, probably because they don’t have to worry about losing their home if they get sick. That is another matter. But shipping is part of this too…..so you pay .88 cents for a bag of carrots in AZ and $1.88 in Canada…..59 cents a lb for bananas in AZ and .89 in Canada. Selection is also an issue…stores don’t stock the same stuff in small Canadian towns. A gallon of milk in Canada is waaay more expensive because of govt. controls on production. A lot of things factor in. But most of it is the glamour of driving down to GF, living the high life and swigging down that 3.2% beer!
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Thank you Alan. What products besides groceries are more attractive to a Pegger? I understand the bright lights are attractive too. It used to be 40 yrs. ago that you came down for the night life because of your Blue laws. I remember you couldn’t carry a beer from one table to the next in a bar legally. There was actually a white line on the beer glass that was the fill line & no higher. Then there were the MEN’S BARS that had the neon sign saying so hanging in the window. You had to go to a government liquor commission store to buy booze & wait in line like you were in a bank making a withdrawal. I think some of those rules are still in effect & if they are it is the night life in GF that must be the draw because it was for sure a main attraction for you back in the 60s-70s. So anyway, what products are cheaper & easier to get down here?
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Oh, Alan, I forgot to mention the beer is 5-6% in ND &MN. 3.2% is in grocery stores. BTW, how late are the bars open in the Peg?
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They enjoy traveling to the states. And our shopping offers them a better selection then what is available in Canada. Not only for clothing but also groceries, even restaurants.
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So devil, the taxes don’t make a diff. to them?
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I’m sure it does Spearman. But I often hear selection is a key factor as well.
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