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Halloween costume prices should drop, next year




CBC News-
It's not just you. Those Halloween costumes really are more expensive in Canada than they are in the United States.

Relief could be on the way after some large retailers lobbied to get a pricey import tariff on costumes eliminated — but not until next year.
Canadian consumers are used to paying higher prices than Americans for just about everything, even with the loonie now sitting above par with its U.S. counterpart. On many items, manufacturers and distributors charge Canadian retailers a higher price than they offer to U.S. retailers, the Retail Council of Canada says.

In the case of Halloween costumes, a CBC News comparison found that the price of an identical costume can often be as much as three times more expensive in Canada than the United States.

Online shopping can lead to savings. But few people are organized enough to take advantage around the time they need the costumes.

"It's not a big ticket item, and you don't have a lot of options," University of Alberta Prof. Paul McElhone says. "If you could buy it somewhere else you probably would. But in terms of disposable incomes, it's a small amount of money."

Beyond often being impulse buys, there are systemic reasons why costumes have gotten so pricey.

They're especially expensive in part because they're subject to an 18 per cent import tariff on "textiles and textile articles." Everything with that classification faces the hefty tariff.

Also, the vast majority of store-bought Halloween costumes are imported from low-cost suppliers such as China and Indonesia, which brings the tariff into play.
They are then subject to other import costs. Canadian-bound costumes are often first imported into the U.S. before entering Canada, which adds even more costs that are then passed on to the ultimate buyers.

Those costs add up. Canadians currently spend about $1 billion on costumes, decorations and candy every year.

"Americans for years have been absolutely Halloween crazy," McElhone says. "It's a big retail time period for them, and … we're just getting some of that spilling over into Canada.

"People are treating it like a mini-Christmas, in some ways."

Many stores pop up to cater to that market niche.

"It's an eight-week business, so on the one hand you want to make as much money as you can," says Lorna Pierson, who owns the Custom Costumes store in Edmonton. "But you also want to encourage people to shop local and buy Canadian.

"Chains are coming in with big buying power and they can get their stuff in cheaper, so it's a tough business."

Indeed, the sector is dominated by major retailers. That's why a group of them lobbied to have the classification changed from textiles to "festive products" which have no tariffs attached to them, because they are really more like temporary decorations than actual items of clothing.

In August, the Canadian International Trade Tribunal agreed with a motion brought forward by Loblaws Cos. Ltd. to make the change.
Effective immediately, imported Halloween costumes won't be subject to the same stringent import tariff. The catch? Because retailers generally order costumes nine to 12 months in advance, shoppers are unlikely to see any difference at the cash register until this time next year.
The tariffs came into effect to protect Canadian manufacturers. But Anne Kothawala of the Retail Council of Canada says there hasn't been a major Canadian costume industry to protect for several years, so there's no need for the outdated tariffs at all.

"The fact that Halloween costumes are no longer subject to a tariff was not a public policy decision whereby government decided to remove one of the competitive barriers in place for Canadian retailers, it was simply a re-classification," Kothawala says.

"[We] hope that when the government hears … about the impact that tariffs have on retail prices they will move to reduce and ultimately eliminate them."





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