Canada seeks to align incentives for electric cars with the United States – Chihuahua News – Intrelíneas

The Canadian government is looking for all kinds of alternatives to avoid suffering the blow from the new tax advantages for electric cars offered in the United States.

Canadian Prime Minister Justin Trudeau has confirmed that his administration could align tax incentives with US President Joe Biden’s proposal if electric cars and batteries assembled on Canadian soil were included in the new US credit program.

“There are several solutions that we have proposed. One of them is to align our incentives here in Canada with those of the United States to ensure that there is no unfair advantage for either party, ”the President said during the meeting. of a press conference.

Biden’s proposal would increase credits for purchasing electric cars in the United States from $ 7,500 to $ 12,500 if they are assembled in unionized US factories and their batteries meet a national minimum content.

Canada and Mexico have accused the proposal of protectionist and discriminatory, threatening to spark controversies within the Treaty between Mexico, the United States and Canada (T-MEC) and even impose tariffs if it is. approved without change in the Senate.

Last week, the Economy Ministry even threatened to impose tariffs precisely “where it also hurts” US imports, saying the credit scheme could cost Mexico heavy auto investments.

Despite what was said by Tradeu, Mary Ng, Minister of Foreign Trade of Canada, reiterated yesterday that her office is considering retaliation such as tariffs or the suspension of benefits for dairy products and American intellectual property.

“I hope we don’t have to do all of this. The important thing is that Canada is preparing for the worst, ”the official said in a television interview.

At the same time, US Vice President Kamala Harris yesterday announced a federal plan to build 500,000 electric car charging stations, underscoring the White House’s intentions to lay the groundwork for “electrification” of the automotive sector. .

The strategy – tied to Biden’s infrastructure and social spending plan – also includes proposals to make the production and purchase of green cars cheaper.

“The future of transportation in our country and around the world is electric… We want electric vehicles to be accessible to everyone,” Harris said at a press conference.

In this context, the Mexican private initiative took a positive view of the Canadian Prime Minister’s proposal, as it seemed to them that it would be more in line with the T-MEC.

“We believe that this is how it could come out, in addition to strengthening the region, which is the main objective of T-MEC,” said Fernando Ruiz, director general of the Mexican Commercial Council for Foreign Trade, l investment and technology. (Come).

In this sense, Ruiz believes that it is possible for Mexico to also align its tax policy for electric cars with that of the United States if it benefits cars manufactured on national soil. Exceptions to the payment of tenure or the elimination of vehicle verification could be made for these cars, he said.

In this sense, Jesús Carrillo, director of sustainable economy at the Mexican Institute for Competitiveness (IMCO), also called the stimuli viable, although he doubted the disposition of the Mexican government.

“I am not sure the federal government is that interested in offering what the Prime Minister of Canada is proposing. The usual messages from the presidency suggest that his government is less likely to want to follow its peers, ”he commented.

The US Senate hopes to pass the proposal – included in the so-called Build Back Better Act – before Christmas and send it to Joe Biden’s office before the end of 2021. However, the package that would cost a total of $ 1 trillion is quite a lot sturdy and complex so a rough road awaits you.

“It is impossible to think that it will come out exactly as the House of Representatives approved it, especially with the elections which will take place next year,” said Jorge Molina, foreign trade expert and professor at Tecnológico de Monterrey.