As of September 8, Canada has imposed counter-tariffs on a wide range of US products. If you import inputs from the United States or export to the US market, here is what you need to know—and what you should immediately verify.
What Has Changed on the US Side
The United States has imposed new tariffs, most of them reaching 50% of the customs value, on targeted products. This time, the situation is different: until now, most US tariffs—with the notable exceptions of steel and aluminum—did not apply to CUSMA-covered goods. The new tariffs, however, apply to goods that are Canadian and enter the United States, including agricultural and industrial products.
For now, these new tariffs do not stack on top of tariffs already in effect on CUSMA-covered goods, such as steel, aluminum, and automobiles, which remain subject to separate tariffs. Another point to watch: certain products are now outright prohibited from being imported into the United States, including alcoholic products, certain dairy products, and motorcycles.
Canada’s Response
In response, Canada introduced counter-tariffs effective September 8, ranging from 15% to 50% on a broad range of products, including:
- Dairy products
- Electronics
- Industrial inputs, e.g., steel chains, tanks, and steel screws
For the most part, these counter-tariffs mirror the US measures: the same products and the same rates. Canada is therefore responding to both the new US measures and tariffs that have already entered in force.
A Duty Relief Program to Know About
The federal government has provided a potential safety valve: an exceptional customs duty remission program. You may qualify in two situations:
- You can demonstrate that you cannot reasonably source the affected input from anywhere other than the United States.
- You can establish “other exceptional circumstances” that warrant a remission.
This program could result in significant savings if your supply chain depends on US inputs that are difficult to replace in the short term.
Three Checks to Make This Week
With product lists changing rapidly on both sides of the border, it is better to have accurate information than to guess. Affilia can help you quickly determine:
- Whether your exported products are subject to the new US tariffs.
- Whether your imported inputs are subject to Canada’s counter-tariffs.
- Whether you qualify for customs duty relief or another federal or provincial assistance program.
Stay Alert: The List Is Changing Quickly
In just a few days, products have been added to the US list, others have been removed, and some cannot even be exported. A review conducted two weeks ago may already be out of date.
Against this backdrop, and with the ongoing impasse over the renegotiation of the CUSMA, Affilia’s team can also help you take a broader look at your supply chains and identify alternative markets where Canada already benefits from favorable trade agreements.
Unsure how these measures may affect your business? Contact us before new changes take place.