Push to remove interprovincial trade barriers hits high gear

The threat of tariffs from the U.S. has sparked calls to eliminate barriers to trading within Canada. We take a look at some of the roadblocks.

B.C. wineries are a major player in the country’s $12-billion wine industry, one that’s fed up with trade barriers making it harder to sell wine within Canada than to the United States.

“The majority of U.S. states now allow for direct-to-consumer delivery, whereas in Canada we’ve been fighting this for the same amount of time, over 25 years,” said Dan Paszkowski, the president and CEO of Wine Growers Canada, on Wednesday.

There is a dizzying patchwork of regulations between the provinces, notes Jeff Guignard, executive director of the Alliance of Beverage Licensees (ABLE BC).

“We have different taxaton systems, different markup systems, we have different rules around storing alcohol, importing alcohol,” he said Wednesday.

Unlike the U.S., the rules in many provinces – including Ontario – prevent a B.C. winery from shipping its product directly to consumers. In Ontario, B.C. wine has to be ordered through that province’s liquor board, which then marks up the cost by a whopping 72 per cent.

“There’s always a misconception that B.C. wines are too expensive to begin with,” said Lorin Inglis, general manager of Enrico Winery on Vancouver Island.

“If you’re going to add 72 per cent, I mean, who can afford that? No one can afford that.”

It’s not just wine though. Trade barriers encompass everything from rules governing professionals working in different provinces to the flow of goods. UBC Economics Prof. Kevin Milligan notes it’s estimated various trucking regulations add up to eight per cent more in cross-country transport costs.

“That’s very tangible to Canadians because so many of our goods have to be transported,” said Milligan. “If you can cut the cost of goods, that’s good for everybody’s pocketbooks.”

Of course, Milligan notes, with a vast country, there are arguments for regional differences.

“We also make sure that the safety of B.C. citizens is upheld, whether it’s for trucking or baby seats, or whatever the sevice or product might be,” he said.

The trade tensions with the United States have triggered a sense of urgency on the issue. The premiers and prime minister met Wednesday, again discussing ways to remove these trade barriers.

“To get into the minutae of the regulations that exist in various industries and harmonize them, I think, is going to take a lot of time,” said Hamish Telford, a political science professor at the University of the Fraser Valley.

But a looming trade war with our neighbour to the south may just be the push needed to make this happen.