MONTREAL — The Canadian government is removing tariffs on imported fabrics that could save domestic clothing manufacturers about $25 million a year, converted from Canadian dollars.
The decision on Friday eliminated a 14 percent tariff on yarn, fibers and textiles imported by Canadian apparel manufacturers. The tariffs were implemented to protect Canadian textile firms.
The removal is retroactive to Jan. 1, and importers will be allowed to claim a refund of any duties paid since then. Canadian designers also will be allowed to import duty-free fabric as long as they partner with a domestic subcontractor to manufacture.
The Canadian International Trade Tribunal spent six months examining textiles used in the clothing sector before submitting a list of 341 fabrics, yarns and fibers that could be imported duty free without harming domestic textile makers.
In addition, the tribunal is undertaking another review to see if more textiles should enter Canada duty free. A decision is expected in six months, and the elimination of those tariffs could result in another $10.5 million in savings annually.
And after a recommendation from the Canadian Textile Institute, the Canadian government has agreed to lift or reduce tariffs on imported clothing from low-cost developing countries if they are made with Canadian textiles.