Published in The Hill Times
By: Charles De Land
April 27, 2026
Reducing internal trade barriers is more important than ever. Encouragingly, Canada is taking positive steps.
Imagine if Canadians could unlock more than $200-billion in economic potential without discovering a single new resource, or by raising taxes by simply removing the barriers we’ve built between ourselves.
A recent report from the International Monetary Fund estimates that eliminating internal trade and regulatory barriers could boost this nation’s GDP by roughly seven per cent. Today, those same regulation-driven frictions act like a hidden nine per cent tariff on Canadians resulting in raising costs, limiting opportunity, and holding back growth within our own country. In this time of disrupted trade relationships and falling productivity, reducing internal trade barriers is more important than ever. Canadian internal free trade should be a national goal.
Encouragingly, Canada is taking positive steps. While acknowledging those actions, it is important to remain focused on long-term implementation and expansion toward a fully free system. For example, Canada should speed up its plan to eliminate trade barriers in food and alcohol. And it should do the same for services, with instant recognition of valid credentials of people from other provinces. While some provinces have taken positive steps, a clear and robust solution is not in place.
The federal government’s removal of all its 53 federal exceptions to the Canada Free Trade Agreement is welcome, as is the Canadian Mutual Recognition Agreement (CMRA) on goods, which critically moves an item to be freely traded from a historical system of “asking for permission” to “inclusion by default.” More can be done. The CMRA excludes food and alcohol. While a memorandum of understanding agreed to by provinces on direct-to-consumer alcohol sales is supposed to be implemented by May 2026, there is little clarity about implementation. Bringing alcohol sales under the CMRA would be a better move.
Even if a food product meets federal standards, individual provinces can still impose additional requirements, such as inspection, which can limit market access. Under the Safe Foods for Canadians Act, food sold across provincial borders must meet the same threshold as exports. While this has improved regulatory consistency, it has limited the ability of small and medium-sized enterprises to scale up, particularly in Western Canada, as they do not have access to provincial markets the size of Ontario or Quebec. Bringing agri-food under the CMRA would mean that any product meeting standards could be sold anywhere, making food more available and more affordable for Canadians.
Additionally, skilled Canadians should be allowed to work in any province. The Committee on Internal Trade’s commitment to expand mutual recognition to services by the end of the year is encouraging. A Canadian worker in good standing with their provincial body should be welcomed by any province, expanding employment opportunities and boosting productivity by getting the right person in the right job.
Strong momentum for free internal trade must be sustained. The Canada West Foundation has previously called for an independent, federally funded Internal Trade Bureau to collect data, update the public on progress, identify and investigate where regulations are more restrictive than they should be. This bureau would serve as a means to promote internal trade, much like the Competition Bureau does.
Finally, Canadian prosperity requires a robust network of physical trade infrastructure such as ports, highways, railroads, airports, electricity transmission and pipelines. Homegrown companies need to be able to effectively move their products and materials to those who wish to buy them, whether it’s Saskatchewan farmers selling wheat to industrial bread producers in Ontario, or a Nova Scotia tire-maker selling to a Belgian driver. This means making smart and strategic investments in trade infrastructure.
Advancing this work would benefit from a co-ordinated national strategy that brings the federal government and the provinces to develop a shared trade infrastructure plan. Such a strategy could better define Canada’s national trade corridors, establish clear criteria for potential projects of national significance and engage the private sector in identifying opportunities for collaboration and investment.
Reducing Canada’s internal trade barriers would result in a significant tax cut, one that would boost Canadian household incomes by thousands of dollars each year, while also strengthening productivity. We cannot let this momentum slip away.
Charles De Land is the vice-president, research at the Canada West Foundation. He has more than 25 years of experience in economic analysis and public policy, with senior roles in government, industry, and think tanks. His work focuses on energy markets, emissions, trade and investment.