- An American tradition for those who live near the Canadian
border has been to travel into Canada and buy gasoline or other things
there. For many years, Americans were delighted to save about 20 to 25
cents on the dollar or more.
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- But those glory days are over for the foreseeable future:
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- Blue label shows the current price of a Canadian dollar
as of this writing. The above chart also illustrates a sharp drop on October
26th, 2007 when the Canadian dollar was actually worth about 9 cents more
than the American dollar.
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- The above chart shows the past 5 years of the value of
the Canadian dollar vs. the American. We can see that in 2009 Americans
could use 1.00 to buy about $1.25 worth of Canadian goods. Although the
GST sales tax in Canada is quite high, if you spent enough money there
customs had a form you could fill out and mail in to get your GST money
back.
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- The above chart shows the currency exchange at 1 minute
intervals. As this was written it was still moving downward. We also see
that for all practical purposes, the Canadian dollar and the American are
essentially at parity. In fact, at many places in Canada they charge you
a fee to exchange one currency for the other, which will turn any purchases
made in Canada into quite a loss. And there may be duty fee issues, too.
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- In addition, there are no real deals to buy anything
in Canada right now. With their new "harmonized sales tax" (which
the government calls it there) averaging around 14% around Canada going
into effect this summer, those planning a vacation in Canada had best bring
far more money for their trip than they planned on. Canada calls it the
harmonized tax because provincial sales tax and the federal tax have been
rolled together.[1]
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- In America, we know that as double taxation. For Canadians
living under a monarchy disguised as a voting democracy, it's shut up and
pay up.
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- Canada's gasoline prices are charged on a per-liter basis.
One gallon consists of 3.785 liters. Buying 3.785 liters of gasoline in
Canada usually costs more than a gallon of gasoline in America. Many years
ago, Americans living in border states often went into Canada just to fill
up their vehicles to save money. Those days are quickly ending. If you
plan to drive into Canada for a day or two, fill your vehicle's tank to
the brim as near to the Canadian border as possible before crossing over.
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- After I finished this article, the Canadian dollar has
already dropped to 1.00440.
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- Ted Twietmeyer
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- Chart source - real time Forex data
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- [1] - http://en.wikipedia.org/wiki/Sales_taxes_in_Canada
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- tedtw@frontiernet.net
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