The Obama administration has submitted a draft budget proposal to the Congress, which includes a proposed fee of $5.50 for Canadians traveling to the USA by air and sea. According to the US Department of Homeland Security, the revenues from this charge would generate approximately additional $110 million a year. This amount is intended to financially support activities of US Customs and Border Protection’s inspection, which has intensified its activities recently.
It was confirmed that the fee would not apply to Canadians traveling to US by road.
The charge is not a new idea, and people coming from other countries into the US already pay a fee. It isusually included in the ticket price, and the method of charging the entrance fee to Canadians will likely be the same. Since 1997, visitors coming to the US from Canada, Mexico and a number of Caribbean countries have been exempted from paying the fee.
The issue could become politically sensitive, since the proposal comes just one week after Canada’s Prime Minister, Stephen Harper, and Barack Obama agreed on establishing the North American Security and Trade Perimeter. Displeased by the proposal, Harper said “Some 40 percent plus of the American spending is financed by borrowing. These are enormously challenging figures”. He also added “We want to ensure that trade and travel is easier, not more difficult, and we don’t need additional taxes on that kind of economic activity.”
According to Canadian official statistics for 2009, 16.3 million Canadians flew to the US in that year alone. The National Airlines Council of Canada (NACC) has also expressed concerns about the proposed entry charges. It could disadvantage Canadian airlines in competition with low cost operations. NACC President George Petsikas commented “Indeed, the announcement of an additional cost advantage for border facilities should make clear the need to reduce the commercial aviation cost structure in Canada.”
As the idea of entrance charge is still in a proposal phase, it is yet to be seen whether it will be approved by the Congress. In the meantime, new lanes were recently added at the Peace Arch border crossing between the US and Canada, making the total number of lanes up to 10.