Former Bank of Canada governor Stephen Poloz said governments, including Canada’s, may use tariffs more widely as a means to generate revenue without raising taxes on their citizens—whether or not Canada and the U.S. implement specific tariffs as initially planned. (The Logic)

Talking point: At a Canada Club Toronto event Wednesday, Poloz said he expects Canada and the U.S. to move forward with tariffs of some sort, which will likely hurt Canada’s already fragile economy more than its southern neighbour’s. GDP could take a bigger hit than the four or five per cent decline that economists are predicting. Poloz added that Canada should agree to increase defence spending in its negotiations with Trump, and suggested the government could raise the money by introducing a small sales tax, for example. “No matter what sort of deal we negotiate, there’s very likely to be a permanent regime of tariffs in the United States,” he said. – Catherine