February 17, 2011 / 7:14 PM / in 7 years

Harper talks of "horrendous" U.S. budget gap

TORONTO (Reuters) - In blunt comments on the U.S. economy, Canadian Prime Minister Stephen Harper said the United States faced “horrendous” budget challenges but should not look to Canadians to help overcome them.

Responding to a U.S. proposal for a passenger inspection fee that would apply to Canadians visiting the United States by air or sea, Harper said an additional $5.50 tax on travel was not constructive for relations between the two big trading partners.

“We all know what the context of this is. The United States has a budgetary situation that is horrendous,” Harper told reporters in Toronto, noting deficits of over a trillion dollars and enormous borrowing requirements.

“I think it’s clear that the U.S. government is casting around for ways to raise revenue. I would obviously say that I think that this is not a useful way to do that.”

Harper said trade and travel between Canada and the United States should be made easier, not more difficult.

The proposed tax is contained in the 2012 draft budget that U.S. President Barack Obama presented to Congress on Monday. Media reports say it should generate around $100 million a year.

Government figures released on Thursday showed 85 percent, or 4.1 million, of Canadians who traveled abroad in December of 2010 were visiting the Unites States.

Reporting by Claire Sibonney; editing by Janet Guttsman

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