Congressman Bill Owens urged U.S. Trade Representative (USTR) Ron Kirk today to use Canada's recent invitation to enter into the Trans-Pacific Partnership negotiations as an opportunity to address a competitive trade barrier that is unfairly imposed against New York wineries. Owens was joined by 12 bipartisan Members of Congress from the New York State and Washington State delegations.
Currently, Canadian residents who purchase wine in the U.S. face provincial and federal taxes that are much higher than corresponding fees for U.S. citizens. Following an April announcement of a $100 million winery project in Ontario, Owens met with representatives of Coyote Moon and 1000 Islands Winery to discuss this wine tax disparity.
"New York wineries contribute a great deal to the region's economic development," said Congressman Bill Owens. "This is a commonsense step that the USTR and the Canadian government should take to ensure our wineries are competing on a level playing field."
A U.S. citizen visiting Canada can return with two bottles of wine duty free, with an additional three percent duty charged on any additional bottles. Canadian residents must stay abroad for at least 48 hours before they can bring back two bottles of wine duty free. Each additional liter is subject to a 62-cent Canadian federal tax and a 39.6% provincial excise tax, effectively doubling the price of the value of the wine. This price hike leads to lost customers for New York wineries.
The New York Farm Bureau and local wineries support this move by Owens:
"An opportunity to have a level playing field is all New York wineries are wanting. New York offers some of the finest wines in the world and removing the unfair competitive trade barriers will allow our neighbors to the north to enjoy the wine long after they return home without being penalized with higher taxes and fees. More importantly, it will provide an economic boost to New York wineries that depend on tourism dollars. We commend Rep. Owens for once again making sure our farmers' interests are being addressed," said Dean Norton, New York Farm Bureau President.
"Being the closest New York Farm Winery to Canada, our family farm is negatively impacted every day by the existing Canadian wine trade barrier. While our Canadian winery colleagues estimate that 35% of their wine sales are made to visiting Americans, conversely, American wineries experience virtually no retail wine sales to Canadians due to the unfair trade barrier. I fully support my elected officials efforts to stop the lopsided, one way flow of wine into the US and encourage them to work with the Canadian officials to create a dynamic economic environment where wine flows in both directions and thereby increases tourism and trade between both countries," said Steve Conaway, President of Thousand Islands Winery in Alexandria Bay.
"The winery industry in Upstate New York is a new and tremendous economic engine that is transforming the North Country. If we are to grow our economy we need the Canadian market. The protectionism policy of the various Canadian governments is preventing that from happening. Citizens of the North Country need our governments help, and we need our government to fight for what is right," said Phil Randazzo of Coyote Moon Vineyards in Clayton.