Duty free stores suffering ‘severe impact’ from U.S. travel boycott, with revenue losses of up to 50%

Liz Bucar, sales supervisor at the Tunnel Duty Free Shop in Windsor is shown in the store on May 7, 2025. Photo by WINDSOR STAR - DAN JANISSEArticle contentDuty free stores are bearing the brunt of the travel boycott to the United States as the steep decline in traffic at Canadian land borders has cut revenues in half for some businesses.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe duty free shops at Canada’s land borders depend entirely on cross-border traffic into the U.S., and the downturn is placing extreme pressure on small businesses in border communities across the country, said the Frontier Duty Free Association in a press conference in Ottawa on Thursday.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.We apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Play VideoArticle contentArticle contentOn Monday, Statistics Canada released its travel data for the month of January, reporting a 22 per cent decrease in trips to the U.S. by Canadian residents compared to the year before. Of these, 1.3 million were made by automobile — 26.3 per cent of trips that month.Article contentPosthasteBreaking business news, incisive views, must-reads and market signals. Weekdays by 9 a.m.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Posthaste will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article content“This decline is hitting land border duty free stores immediately,” said Barbara Barrett, executive director of the group, which represents Canada’s 31 land border duty free stores. “Our members… can only sell to travellers leaving Canada, which means when traffic declines, revenues decline with it.”Article contentJanuary marked the 13th consecutive month of year-over-year declines in cross-border travel to the U.S., which totalled 2.1 million trips in the month, according to Statistics Canada.Article contentBarrett said that, for many duty-free businesses, revenues are down “between 40 and 50 per cent,” with even steeper declines in smaller or more remote crossings. The stores are small, often family-run Canadian businesses, she said.Article contentShe added that the stores — federally regulated, licensed, export-only businesses operating under the oversight of Canada Border Services Agency — has no domestic market to fall back on and no alternative channel to offset the losses.Article contentArticle content“There is no way for these stores to pivot their business,” she said. “Across the country, stores are seeing severe impacts.”Article contentBarrett said the downturn in cross-border travel is “temporary” and not structural, driven by external pressures — political tension, trade friction — and “not a permanent shift in travel behaviour.”Article contentShe said that while those conditions will change, the businesses are operating at a disadvantage relative to their U.S. competitors. The group has already presented solutions to the federal government.Article contentCanada’s duty free businesses face a structural tax disadvantage relative to their American counterparts and are not treated consistently with other Canadian export channels, the group said.Article content“Duty free stores represent the final opportunity to keep dollars in Canada that would otherwise be spent in the United States,” Barrett said. “When these businesses are competitive, that spending stays here; when not, it goes directly to the U.S.”Article contentTrending Iran oil revenue soars as it's the only exporter out of Hormuz Oil & Gas Meet the Canadian e-bike maker who is redefining the factory floor Electric Vehicles LNG Canada signs key pipeline agreement required for phase two expansion Energy Canada’s economic performance has been lagging the U.S. for years, and this is to blame Economy Why market bets for interest rate hikes in Canada are so high Economy Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Iran oil revenue soars as it's the only exporter out of Hormuz Oil & Gas Meet the Canadian e-bike maker who is redefining the factory floor Electric Vehicles LNG Canada signs key pipeline agreement required for phase two expansion Energy Canada’s economic performance has been lagging the U.S. for years, and this is to blame Economy Why market bets for interest rate hikes in Canada are so high Economy