Oct. 1 (Bloomberg) -- Canadian Finance Minister Jim Flaherty said today his government will waive a 25 percent tax on imported cargo vessels, which will save ship owners C$25 million ($24.5 million) a year for 10 years.
The finance minister, who was speaking by the Welland Canal that links Lake Ontario and Lake Erie, said the measure will apply to general cargo vessels, tankers, and larger ferries.
“The measure responds to Canada’s need to maintain a modern and efficient shipping industry that serves as a vital transportation link for Canada’s internal and external trade in agriculture, mining and manufacturing,” Flaherty said.
“This is going to position all Canadian ship owners to look at their older ships and consider replacing them,” said Wayne A. Smith, Algoma Central Corp.’s senior commercial vice-president. “The time to renew is now.”
The company’s ‘Algocanada’ -- an 11,000 metric ton tanker built 2 years ago and loaded with diesel -- was visible at Flaherty’s announcement. St. Catharines-based Algoma Central owns and operates as fleet of vessels that carry raw materials such as coal and grain.
The measure applies retroactively, according to a statement issued on the Finance Ministry’s website. Earlier today, B.C. Ferries announced that it would use part of the C$119.4 million in tariff rebates it will receive to reduce fares by 2 percent.
To contact the reporter on this story: Colin McClelland in Toronto at email@example.com