Government waives operator fees in Canada

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The government has waived fee payments from Canada's duty-free operators following the conclusion of a three and a half year regulatory review into the business. Land border operators will no longer be liable for the 3% of sales which they have traditionally paid, saving some operators up to C$900,000 ($588,000) a year.

Among the other findings of the review was to retain Canadian citizenship and residency as a requirement for duty-free licences, return to five-year licences for land border contracts, allow only one duty-free shop per border crossing, and to fix a system of licence renewal rather than re-tender licences.

The news was celebrated by existing operators and the Frontier Duty Free Association (FDFA), which had feared the government might allow foreign competition for licences at the border. World Duty Free Americas had previously expressed an interest in operating on the Canadian side of the border.

FDFA president Julian Lewin said: "We're very pleased. It doesn't make up for the blow of the tobacco tax [implemented last month] but the government has responded to all our requests on the review. And it's a victory for the travelling public." But operators continue to struggle with the effects of the export tax on cigarettes, and many customers have expressed anger that taxes of C$10 ($6.50) have been added to cartons of cigarettes.