Saying that Canadian editions of U.S. magazines are unfair competition, Canada plans to slap them with an 80 percent excise tax.

Heritage Minister Michel Dupuy will announce the tax at a news conference Thursday afternoon, External Affairs spokesman Kevin Sinnott confirmed Wednesday.The tax will affect "split-run" editions - in which a few pages of a U.S. magazine are replaced with Canadian editorial content. The publisher also resells a few advertising pages to Canadian businesses.

Canadian magazine publishers say the practice is unfair because it eats up scarce advertising dollars needed to keep home-grown publications afloat.

A U.S. State Department spokesman said Tuesday that American officials were examining their right to retaliate against such a tax under the North American Free Trade Agreement.

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NAFTA allows the Canadian government to prop up cultural industries such as magazine publishing. But Canada faces possible retaliation of "equivalent commercial effect" if the measure has a financial impact on its trade partner.

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