Cam Bissonnette, the general manager of the Osoyoos Duty Free Shop, received support from Town of Osoyoos council on Monday as they agreed to send a letter of support for a national rebate program that would allow duty free shops to return the five per cent GST on goods purchased in Canada to Americans who shop in border communities like Osoyoos. (Keith Lacey photo)
Town of Osoyoos council has thrown its full support behind a program designed to attract more American customers to travel to Canada and spend money at businesses and duty free shops in border towns like Osoyoos.
Cam Bissonnette, the longtime general manager of the Osoyoos Duty Free Shop, asked for and received support from town council to promote a new initiative called Road TRIP (Road Travel Rebate Incentive Program).
Members of the national Frontier Duty Free Association are seeking support from border communities across Canada and there has been overwhelmingly positive response thus far, said Bissonnette.
The pilot project is designed to encourage Americans to visit Canada and spend money at various businesses in border communities like Osoyoos, said Bissonnette.
Town council agreed to sign a “form letter” that will be sent to Canada’s Minister of Finance, Bill Morneau.
The National Chamber of Commerce in their upcoming requests in the federal budget has unanimously accepted Road TRIP, said Bissonnette.
This program would allow duty free shop owners like Bissonnette to pay out cash rebates to customers who shop in Osoyoos and provide receipts of proof of purchase, he said.
“I would give them some of their money back on the spot,” he said.
The proposed tax rebate would encourage American tourists to shop in Canada by allowing them to “take five”, meaning U.S. visitors travelling into and out of Canada through a land border crossing would be eligible for a rebate of five per cent (equal to the GST) on purchases made during their trip.
Applications for this rebate would be available at participating Canadian duty free stores, located at land border crossings across Canada. The rebate could then be spent at each crossing’s respective duty free store.
Border communities like Osoyoos have been faced with many barriers to attracting American shoppers over the past decade, including post-9/11 border security, a strong Canadian dollar, increased popularity of online shopping, high gas prices and lower sales taxes in many American jurisdictions, he said.
All of these factors have resulted in 24 per cent less American travellers to Canada over the past decade and an alarming 14 per cent reduction between 2008 and 2013.
Over the same five-year period, there has been a reduction of 33 per cent in the total dollar amount spent by American visitors to Canada, said Bissonnette.
Many of Canada’s strongest rivals for tourist dollars, including Great Britain, the European Union, and India, have all instituted tax rebate programs for international visitors, he said.
“The Road Trip proposal is wisely targeted at stimulating American tourism and increasing the extent to which border communities, and Canada as a whole, can benefit from U.S. tourists, by reducing the tax burden on Americans travelling to Canada,” said Bissonnette, in a letter presented to town council. “Despite the aforementioned negative trends, the U.S. remains Canada’s largest source of tourism and shopping routinely ranks amongst the top three reasons for tourism in Canada, so Road TRIP would be an impactful policy.”
While the benefits of this proposal are many, the costs would be minimal, said Bissonnette.
The 28 land border crossing duty free stores that would be eligible for Road TRIP already possess the capacity to self-administer the pilot project and provide regular audited updates on its impact, without additional administrative burden or cost to the federal government, he said.
It’s estimated that the program would offer $5.2 million in rebates to American shoppers who visit Canada and would greatly assist border retailers and duty free stores, as well as Canadian supplier companies to increase foot traffic and sales, he said.
“It is truly a thank you to American customers in providing an incentive to have their goods receipts rebated,” he said.
Under the old Visitor Rebate Program, over 70 per cent of customers, when they received their money back at duty free stores, would spend back in the stores, assisting the Canadian government in reinforcing the goal to repatriate sales otherwise lost to the United States, he said.
Since many border retailers and duty free stores do not have e-commerce sites, a program like Road TRIP is needed to stay competitive, he said.
He has customers in his duty free store all the time asking about rebate programs and ultimately leave dissatisfied when they discover there is no longer any rebate program offered, said Bissonnette.
“We are the only country out of all the Organization for Economic Co-operation and Development (OECD) that doesn’t offer a rebate on a national tax,” he said. “The VRP was cancelled in 2007.”
With the value of the Canadian dollar dropping significantly over the past several months and the relative strength of the American dollar, many Americans will be looking to visit Canada in 2016 and an incentive rebate program like this would really help local businesses, said Bissonnette.
Town councils in numerous Canadian cities, including Windsor, Sarnia, Toronto, Sault Ste. Marie and Niagara Falls, have all supported the Road Trip program proposal, he said.
“In closing, I would like to state that I strongly support instituting Road TRIP in order to encourage more Americans to travel to Canada … and to encourage those travellers to spend more during their stay in Canada,” he said. “Should the Road TRIP initiative receive the support of the federal government, I will commit to allocating funds from my municipality’s marketing budget to raise public awareness about the program.”
KEITH LACEY
Osoyoos Times
