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NAFTA Negotiations and Canadian Taxes

Those Canadians following the North American Free Trade Agreement (NAFTA) negotiations during the Fall 2017 may have noticed that the talks are not progressing very quickly or productively. United States President Donald Trump seems committed to taking a hard line on negotiations. Some are even speculating that the US President may want to see the talks fail now and fix the problems later. According to media outlets, lingering uncertainty could be a drag on the Canadian economy and could be reflected by interest rate hikes.

NAFTA topics of interest include:

  • the President's interest in a sunset clause that will allow for the renegotiation of the agreement every five years, and its automatic termination without unanimous agreement to extend;
  • clauses addressing ecommerce given that ecom was not a factor at the original negotiating table;
  • a proposed increase in the minimum amount of U.S. parts required in automobiles to avoid tariffs;
  • a new chapter focused on small and medium sized enterprise;
  • US demands for an end to Canada's supply management system for dairy.

For Canada's part, Prime Minister Trudeau is pushing a social reform agenda aimed at clauses that address elements like climate change, the environment, women's and Indigenous rights.

Stay tuned.

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