Canada: $24,599 U.S.: $21,820 Price Gap: 12.7% Reason: rules and regulations, taxes and tariffs
Here tariffs do play a role. For example, tariffs on imports from non-NAFTA countries run at 6.5% but only 2.5% from the U.S. Other factors are different auto safety regulations—all the way down to small tweaks like converting dashboard displays to metric.
Rules and regulations
Altering products to comply with the rules of regulatory bodies such as the Canadian Standards Association or Health Canada can add to product costs. The Electro-Federation Canada, estimates compliance costs can add up to 10% to gadget prices.
Taxes and tariffs
Import tariffs are the most variable factors in the price gap: some products are free to enter the country, while others are subject to massive government taxes. Sometimes the tax is artificially high to protect domestic industry; many are just revenue-generators for government.
Sometimes the price difference really is pure economics: Canada is a sprawling country with a small population, which means higher costs for shipping, storage, distribution and economies of scale. And, of course, retailers can charge more simply because there’s less competition up here, so we have no choice but to pay up.
Graham F. Scott: Why do goods cost more in Canada?