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Wednesday, May 23, 2012

Runs to the U.S. border to shop costly to Canadian economy


   Canada column for Sunday, May 20/12

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   THE CANADIAN REPORT
   (c) By Jim Fox

   Canadians making a run to the U.S. border to shop are costing the economy much more than earlier believed, the Bank of Montreal says.
   "There are already more than 50-million visits to the U.S. by Canadian residents annually,” with the number expected to swell with higher duty-free limits starting June. 1, said Doug Porter, the bank’s deputy chief economist.
   "A culmination of factors is likely to unleash a wave of Canadians cross-border shopping this summer in numbers not seen in two decades," he added.
   This is happening even as the bank assessed the gap between Canadian and U.S. prices for consumer goods has narrowed to 14 percent on average from 20 percent a year ago.
   Canadian business owners are not pleased that the government is raising the duty-free limit to $200 from $50 for stays longer than 24 hours and to $800 for visits of two days and more. It has been $400 after two days and $750 for seven days away.
   Generally, most people aren’t charged anything extra on same-day shopping trips for groceries, which are duty free, gasoline or goods amounting to less than $100.
   Since many people don’t report everything they’ve bought, even a “conservative estimate” of five percent more in goods drains an added $20 billion a year from the economy, Porter said.


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   Quebec’s attempts to get tough with rioting students with large fines are being called a “blow to freedom of expression” by student leaders.
   An emergency bill allows for fines of $1,000 to $5,000 for preventing anyone from entering an educational institution in protests over planning tuition-fee increases.
   The penalties climb to between $7,000 and $35,000 for a student leader and $25,000 and $125,000 for unions or student federations.
   All the fines will double for repeat offenders and there are strict regulations for demonstrations, including having to give eight hours’ notice.
   The latest protests have included blocking university campuses, roads and businesses.
   Premier Jean Charest said the measures are aimed at restoring order after three months of student walkouts and demonstrations that have turned increasingly violent.

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   News in brief:
   - There were mixed signals from the Canadian government over planned changes to jobless benefits after Finance Minister Jim Flaherty suggested a hardline approach. He said “any job is a good job” and the current rules are a disincentive to work. Human Resources Minister Diane Finley said later there are no plans to force unemployed workers receiving benefits to take any job available or refusing jobs significantly below their previous earnings level.
   - Superior Court Judge Thomas Heeney called Michael Rafferty, 31, of Woodstock, Ontario a “monster” as he sentenced him to life in prison for the rape and murder of Tori Stafford, 8. The Grade 3 student was abducted as she walked home from school three years ago. Terri-Lynne McClintic, 21, who assisted Rafferty, was earlier sentenced to life in jail.

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   Facts and figures:
   Canada’s inflation rate edged up one-tenth of a point to two percent last month, led by increases in transportation costs and food prices.
   There was a big dip for the Canadian dollar in the past week, down 2.5 cents to 97.89 cents in U.S. funds on Friday. The U.S. dollar rose to $1.0214 Canadian, before bank exchange fees.
   The Bank of Canada’s key interest rate is steady at 1 percent while the prime-lending rate is 3 percent.
   Stock markets are again lower, with the Toronto exchange index at 11,347 points and the TSX Venture index 1,232 points.
   Lotto 6-49: (May 16) 2, 3, 12, 15, 19 and 49; bonus 5. (May 12) 4, 5, 10, 34, 37 and 45; bonus 7. Lotto Max: (May 11) 1, 6, 7, 24, 31, 36 and 39; bonus 26.

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   Regional briefs:
   - A review into the G20 economic summit in Toronto two years ago recommends criminal charges against several police commanders for misconduct. The charges would be in addition to 28 frontline officers facing disciplinary hearings for offenses including unlawful arrests and use of excessive or unnecessary force.
   - Five people were killed in a mid-air collision near St. Brieux, Saskatchewan involving a Piper Cherokee and a Lake Buccaneer amphibious plane. Eric and Joy Jackson of Regina, Saskatchewan died in the crash along with Eric and Wade Donovan of Mossleigh, Alberta and pilot Denny Loree of Nanton, Alberta.

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Jim Fox can be reached at canadareport@hotmail.com

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