The Canadian government said it will “vigorously defend” its trade policies and infrastructure investments against any of the findings of a Federal Maritime Commission study looking into the diversions of U.S. imports to Canadian ports.
Gerald Keddy, parliamentary secretary to Minister of International Trade Ed Fast, said on Wednesday the Canadian government has invested in its port infrastructure as part of “an ambitious pro-trade, low-tax plan that is creating jobs and economic growth.” The FMC earlier approved an inquiry into whether the U.S. is losing Harbor Maintenance Tax revenue from American imports, particularly from those diverted through the Port of Prince Rupert, B.C.
FMC Chairman Richard Lidinsky said the study will also see if HMT revenue is lost due to Mexican and Canadian ports’ “differences in container inspection practices and costs, rail costs and infrastructure cost investments.” Despite allegations of Canada subsidizing cargo diversion, Lidinsky said the agency hasn’t found any evidence of this.
The FMC will focus on the effect of the Harbor Maintenance Tax on the diversion of cargo. Carriers pay the tax based on the value of their cargo each time a ship calls at a U.S. port. Cargo landing in Mexico or Canada for shipment to the U.S. does not pay the tax.
Washington State’s two senators, Patty Murray and Maria Cantwell, both Democrats, sent a letter to Lidinsky on Aug. 28 requesting the study after hearing their states’ ports might be losing business to Prince Rupert. Eight House members, six Democrats and two Republicans, sent an identical letter Friday, with an additional letter from a Democratic member from California.