YOU ARE HERE: LAT HomeCollections

Travel Insider

Weakening U.S. Dollar Still Finds Strength in Canada : Currency: The greenback is buying more in the 13 provinces. And hotels offer tax refunds on the spot.

July 17, 1994|CHRISTOPHER REYNOLDS | TIMES TRAVEL WRITER; Reynolds travels anonymously at the newspaper's expense, accepting no special discounts or subsidized trips

Let us all now say a small prayer of thanks for Canada and its currency. While the U.S. dollar crumbles against the Japanese yen in global currency markets, our money is buying steadily more in Canada. The trend is strong--in May, the U.S. dollar reached its strongest level in seven years against its Canadian counterpart--and experts say it's likely to last at least through this year.

Still, if you're like many Americans, you don't have a clear sense of how far one of our dollars goes when it's renting a room in Vancouver or buying dinner in Toronto. The answer is that right now those dollars can go far indeed--not only because of exchange rates, but also because of the generally reasonable prices of hotels and restaurants in Canada's leading cities, and Canada's often-overlooked system of tax refunds for foreigners.

Exchange rates. For about the last three months, the Canadian dollar has been buying about 72 American cents in currency markets. That's down four cents from the beginning of the year, six cents from a year ago, 11 cents since 1989. Citing the independence movement in Quebec and Canada's high public debt, some analysts say the Canadian dollar is likely to continue weakening and may soon match its all-time low against the U.S. dollar when it was worth 69.2 cents in February, 1986.

For the Record
Los Angeles Times Sunday July 31, 1994 Home Edition Travel Part L Page 4 Column 6 Travel Desk 1 inches; 31 words Type of Material: Correction
Canada provinces--Due to an editing error, a headline on the Travel Insider column for July 17 ("Weakening U.S. Dollar Still Finds Strength in Canada") indicated that Canada has 13 provinces. Canada has 10 provinces.

This doesn't mean that the current trend in exchange rates will inevitably save American tourists money. Tourists in Canada who buy goods that have come from the United States (clothes from a Canadian outlet of The Gap, for example) will find the economic machinery working against them. It's better, when in Canada, to buy Canadian.

Food and shelter. By one widely used measure, upscale travelers' costs in three of Canada's most-visited destinations, Toronto, Montreal and Vancouver, run at least $40 a day less than they do in Los Angeles or San Francisco, and about $180 a day less than in New York.

The figures come from the U.S. and Canada offices of business travel consultants Runzheimer International, which calculates per diem rates for business travelers. (Budget travelers, do not be alarmed at the numbers that are about to follow. To get its figures, Runzheimer surveys advertised prices at top-notch hotels and restaurants near a city's business center--the most expensive places in town, basically. But even if you're staying somewhere far cheaper, the prices are indicators.)

In figures gathered since last October, Runzheimer sets its Los Angeles figure at $202.65 for a day's first-class lodgings and meals. Its San Francisco figure: $192.15. New York: $338.05.

Meanwhile, in Montreal, Runzheimer's most recent per diem rate--calculated last August, before rates got even better for Americans--was $141.65 in U.S. dollars ($104 for lodging, $37.65 for meals).

In Toronto, the rate was $140.10 ($105.50 for lodging, $34.60 for meals). For a broader view of lodging in that city, consider the 1993 hotel survey cited by the Toronto Convention & Visitors Assn., which found an average advertised price per room-night of $86.81 in Canadian dollars--in the neighborhood of $65 U.S.

In Vancouver, where prices can vary widely by season, the per diem estimates were $147.80 ($115 for lodging, $32.80 for meals) for the months from May through September, and $123.30 ($90.50 for lodging, $32.80 for meals) for the months from October through April. Most leisure travelers spend substantially less; when the Greater Vancouver Convention & Visitors Bureau surveyed more than 10,000 visitors last year, they reported an average of $85 per day in total expenses.

Tax refunds. Like the value-added taxes found throughout Europe, Canada's Goods and Services Tax (also known as the GST and currently set at 7%) is added to most goods (excluding meals, beverages, tobacco, rental cars, gasoline, airline and train tickets, and some artworks and jewelry) and is generally refundable to foreign tourists who collect receipts, fill out a form and mail them in. But unlike many value-added taxes elsewhere in the world, Canada's GST levies on hotel rooms are easily refundable to individual travelers.

If an American traveler has sales receipts for more than $100 Canadian in total spending, he or she can get a refund claim form from a store, hotel or any border crossing. The traveler fills out the form and can either seek a refund immediately (in Canadian currency) from a Canadian Duty Free Shop, or mail the form and receipts in within a year of the purchases and receive by mail (an estimated 6-8 weeks later) a check in U.S. currency. Spend three nights in a $100 hotel room and you have at least $21 coming to you. For more information on GST refunds, call (613) 991-3346 from the United States, (800) 668-4748 from Canada. (The provinces of Quebec and Manitoba also offer sales tax refunds for purchases totaling more than $100.)

Los Angeles Times Articles