Canada Tax double-dinged?

[TrevTremaine]

Are we seriously looking at being double-dinged if the government applies tariffs to Teslas? That is, we're going to be hit with a luxury tax and now an additional tariff? Will they apply the tariff first, then the luxury tax on top of it?

 

[Tz00]

And HST on top of them both?!

 

[kingston-ont]

Is there reason to think that retaliatory tariffs would target EVs? The auto sector was mentioned, but I wonder if auto parts would be a more likely target, along with a host of non-automotive goods (e.g. dairy).

 

[TrevTremaine]

Is there reason to think that retaliatory tariffs would target EVs? The auto sector was mentioned, but I wonder if auto parts would be a more likely target, along with a host of non-automotive goods (e.g. dairy).

It's all dependent upon the mindset of the government - can anybody reasonably predict what they'll do?

 

[Calliope]

It's only a luxury tax for their higher end models (S and X), not because they're Teslas and not for all Teslas. If you want to drive a Tesla, you don't have to pay a luxury tax.

As for the tariff, my bet is it will never come to pass -- it's political posturing and threats because Biden is threatening to violate the Free Trade act, whatever it's called these days.

 

[mrElbe]

Traditionally the US will only abide by agreements if they are advantageous to them.

 

[pabla]

If anyone is curious about the luxury tax, the federal govt just released an update here and on the PDF page 53 it states that we will see draft legislation early 2022. Meaning the tax won't go into effect on January 1 2022, likely Spring 2022 and maybe even a slightly modified taxing scheme to align with the responses they received.

 

[paulis]

Exact text from the update linked above:

Luxury Tax

Budget 2021 proposed to introduce a tax on the sales, for personal use, of luxury cars and personal aircraft with a retail sales price over $100,000, and boats, for personal use, over $250,000. The tax would be calculated at the lesser of 20 per cent of the value above the threshold ($100,000 for cars and personal aircraft, $250,000 for boats) or 10 per cent of the full value of the luxury car, boat, or personal aircraft. The Department of Finance has undertaken consultations with respect to the design of this measure and is working to incorporate the results of this consultation into the proposed tax framework. Draft legislation, including details on coming-into-force, will be released in early 2022.