Made-in-Canada Cars to Be Sales-Tax Free, Conservatives Promise

Conservative Leader Pierre Poilievre pledged to remove the federal sales tax on new Canadian-made cars, offering his response to the Trump administration’s auto tariffs while trying to shore up support from workers whose jobs are at risk.

Author of the article:

Bloomberg News

Randy Thanthong-Knight

Published Apr 03, 2025  •  2 minute read

Pierre Poilievre. Photo by Arlyn McAdorey /Photographer: Arlyn McAdorey/Blo

(Bloomberg) — Conservative Leader Pierre Poilievre pledged to remove the federal sales tax on new Canadian-made cars, offering his response to the Trump administration’s auto tariffs while trying to shore up support from workers whose jobs are at risk. 

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Poilievre — who’s now trailing chief rival Liberal Leader Mark Carney in opinion polls ahead of the April 28 election — announced the plan on Thursday, the same day US President Donald Trump’s 25% tariffs on auto imports went into effect and Carney’s government retaliated with import taxes on American vehicles.

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The Conservative leader is also calling on provincial governments to follow suit in removing sales taxes. Under his plan, buyers would save C$2,500 ($1,779) in tax on a vehicle made in Canada with a price tag of C$50,000. If provincial sales taxes were removed, he said those savings would be up to C$7,500.

He said his plan will boost the sale of Canadian-made cars and support the country’s auto industry and workers. 

In the auto manufacturing province of Ontario, examples of vehicles that would benefit from the tax break include a new Chevy Silverado from a factory in Oshawa, a Honda CR-V from Alliston, a Toyota RAV4 from Woodstock or a Chrysler Pacifica from Windsor, according to Poilievre. 

Canada’s auto sector is deeply integrated with the American industry, and more than 93% of its car and light truck exports are destined for the US. Trump’s tariffs on imported vehicles have already disrupted the Canadian sector that employs more than 100,000 workers. 

Stellantis NV, the owner of Jeep and Ram brands, said it will pause its Windsor, Ontario plant for two weeks beginning Monday. 

The uncertainty around Trump’s tariff plan had prompted businesses to front-run shipments in January, only to reverse course a month later. Exports of cars and parts fell in February, mainly due to lower exports to the US. 

Separately on Thursday, Carney announced Canada will apply 25% retaliatory tariffs on US-made vehicles that aren’t compliant with the US-Mexico-Canada Agreement, as well as on American components of vehicles that do comply with the trade deal. 

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