EV tax credit ‘not good news’ for Canada, ambassador to U.S. says
Canada’s ambassador to the U.S. stressed further that a proposed tax credit that encourages production in the U.S. would cause harm to Canada’s economy.
“It’s not good news for Canada. It’s also really not good news for the U.S.,” Ambassador Kirsten Hillman said during an interview with Global News’ Mercedes Stephenson on The West Block.
The tax provision is currently under debate at the House of Representatives and has not been passed yet.
It calls for a $4,500 incentive for union-made vehicles and $500 for U.S.-made batteries. Vehicles would have to be made in the United States starting in 2027 to qualify for any of the $12,500 credit.
It will be an item of discussion during a “Three Amigos” summit between Canada, the U.S. and Mexico next week, Foreign Minister Melanie Joly has said. Joly also took up the tax credit matter with U.S. Secretary of State Antony Blinken recently.
‘Three Amigos’ summit: Trudeau, Biden, López Obrador to all meet in Washington next week – Nov 10, 2021
Hillman agreed that the credit would disrupt the supply chain, but pointed out that disruption could also cost tens of thousands of American jobs.
“The degree of integration that we have in our auto sector will mean that that tax credit will disrupt our very efficient and effective supply chains in the auto sector, supply chains that literally tens of thousands of American jobs rely on,” she said.
Hillman said she and her team are working hard to get those facts to U.S. Congress and are also talking to the House of Representatives and the White House.
“We’re explaining to them that this tax credit just isn’t in the U.S. interest,” she said.
“It will hurt American jobs. It’s inconsistent with their international commitments, including their most recent commitments under CUSMA.”
Hillman said the proposal won’t put more electric vehicles on the road but instead would “disrupt” the EV sector.
Canada’s new industry minister, Francois-Philippe Champagne, has also said Canada would respond “appropriately” if the tax credit were approved.
READ MORE: Canada says U.S. electric vehicle tax credit plan could harm industry, violate trade pact
“They understand that legislation like that would generate a response on the Canadian side,” Champagne said. “We have always responded appropriately to these types of legislation.”
“I’m able to contact them. So we are able to talk to them when we want to on things that matter to us and on things that matter to them,” she said.
–with files from Reuters
