Better Value in Dollar

Lately I was asked a lot of questions regarding importing large screen Plasma/LCD TVs from the US.

After a brief survey, I wasn’t surprised that there’s a sharp price disparity between the US and Canadian prices. Take the popular Sharp – AQUOS 52″ 1080p Flat-Panel LCD HDTV for example, both BestBuy.com and BestBuy.ca have a special offer, one at US$1299, the other at CA$1,899. 46% price difference.

So it makes all the sense to shop in the US. Or is it?

Now how much duty or tax will you be charged? This may change the equation significantly. Here’s the list of taxes that you’ll have to pay when importing that big screen TV.

• US state tax, depending on which state you purchase the TV. New Hampshire has 0% state tax, whereas Washington taxes 6.5%.
• Duty of 5% (8528.72, covering high-definition, flat-screen, projection, CRT ), if the TV is not made in Mexico or US. One reader reported 7% being labeled as “luxury tax”. I cannot find reference on excise tax.
• GST/PST on top of all above.

If you have stayed outside Canada over 48 hours, you can claim your personal exemption of $400 or $750.

One tip, many good brand TV, e.g. Panasonic 50″ Plasma T.V, are  made in Mexico. You can get away without paying the duty by choose those brands. When you cross the border, choose a senior-looking officers who would be more experienced in dealing with NAFTA and duty issues, and make less mistake in calculating the duty/tax.

Do your math, then you know whether it’s worthwhile.

Update Jan. 6 2010: A reader reported that the duty of an HD display TV is 3.5%,  assuming it’s made outside North America.

Another Update: If you live close to the border, try get free shipping to a UPS store near the border and you can go pick up. Amazom.com has the best deals on HDTV, Cameras, and Computers. I saved myself 25%, doing this, see blog here.

To every Canadian shoppers, the exchange rate of Canadian over US dollar is always on our mind.  After hitting the record high over 1.08 (CA$/US$) in Nov. 2007, Canadian dollars had been trending downwards.

When CA$ was at the lowest point in Feb. 2009 was 0.78, it felt like the miserable old days in the last twenty years.

Now the million dollar question is “Will Canadian dollar appreciate to par with US$ again?”.

Given our limited population (30M vs. 300M in US) and limited dominance in hi-tech (considering the failure of Nortel), the most valuable thing in Canada is our natural resources.  Canadian dollar will be moving in tandem with natural resource prices.

When the recession is fading away, natural resource prices will move up and so will Canadian dollar . Meanwhile the huge bailout spending by the US government will significantly weaken the value of US dollar. The predication from forecasts.org is that by Oct. our loony will be in the 0.92~0.95 range.

The good time of cross border shopping will be back.

As Canadian, we strongly feel that we are different from Americans. The Molson “Rant” ads for Canadian beer recounted all the differences. However Americans don’t appreciate it so. There goes the saying,

“Canadians and Americans are indistinguishable. The only way to distinguish them is to make the previous statement in front of them”.