Canadian operators welcome first step in allowance restructure

Canada’s border retailer association the Frontier Duty Free Association (FDFA) has welcomed the increase in duty-free allowances for Canadians returning to the country after 48 hours or more, revealed on RavenFox.com earlier today, while calling for further improvements to the country’s inbound allowances.

The changes were welcomed by FDFA allowances committee chair and Peace Bridge Duty Free manager Chuck Loewen and FDFA executive director Laurie Karson. In a joint statement they said: "This change will impact positively both Canadian manufacturers, as well as Canadian duty-free stores, allowing the greater purchase of these goods prior to leaving Canada and allowing for their return to Canada after the specified period."

In a letter to the Canadian alcohol, tobacco and excise legislation chief Carlos Achadinha, Karson recommended further measures to encourage travellers to "buy Canadian" before leaving Canada. The recommendations, wrote Karson, follow on from the 2005 Canadian Senate review "to immediately increase Canadian dollar allowances to levels consistent with the US and Mexico, and to increase the Canadian allowance to C$2,000 ($1,695) by 2010".

The FDFA proposals include: raising the returning exemption for passengers spending over one day out of Canada to C$200 ($169.49); raising the exemption to C$800 ($677.97) after 48 hours away and; raising the liquor allowance to 1.14l of liquor plus 24x355ml of beer and 1.5l of wine.

Karson argued: "It may appear that Canadian allowances would be of little concern to Canadian duty-free shops which serve customers exiting Canada. However, a significant part of the Canadian duty-free shop mandate is the promotion of Canadian products. Travellers consistently show a great deal of interest in our Canadian offering, but under the current allowance structure many are reluctant to utilize their limited allowance on returning to Canada by making purchases before they have left the country. Increased allowances would encourage travelers to "buy Canadian" before leaving Canada. Such increased sales of Canadian product within Canada would benefit not only the Canadian duty-free industry, but the many Canadian suppliers and craft people who rely on duty free as an outlet for their products."