CUSTOMS WORKFLOW

How the Canadian Surtax Works

Classification, origin, value for duty, relief and border administration — the steps behind the headline rate.

HOW TO READ THE SURTAX

The legally relevant sequence is classification → origin → value → rate → relief → accounting. Skipping any step can produce the wrong answer.

1. Classify the product

Canada’s countermeasure list is organized by tariff item. Commercial names are not enough. The Schedule to Canada’s Customs Tariff controls classification.

2. Determine legal origin

Finance Canada states that the new measures apply to U.S.-origin goods under the Determination of Country of Origin for the Purpose of Marking Goods (CUSMA Countries) Regulations. A U.S. seller, warehouse or invoice does not by itself establish U.S. origin.

3. Determine the calculation base

Existing Canadian counter-surtax orders on U.S. steel, aluminum and motor vehicles use “value for duty” determined under Customs Act §§47–55. The new September 8 order must be checked before FCA treats that existing pattern as the controlling formula for every new tariff item.

Illustration, not a legal conclusion: if an operative order applies a 25% surtax to a $100,000 value for duty, the surtax component would be $25,000 before other duties, taxes, fees, adjustments or relief.

4. Test relief before stopping at the headline rate

Canada maintains a remission process for exceptional cases. Finance Canada says requests may be considered where an input cannot be sourced domestically or reasonably from non-U.S. sources, among other situations. Existing remission orders also create specific relief.

Issue	Authority to check
Countermeasure power	Customs Tariff §53
Goods already in transit	Customs Tariff §79 + operative surtax order
U.S. origin	CUSMA marking-origin regulations + operative order
Value for duty	Customs Act §§47–55 + operative order
Applicable rate	Operative tariff-item schedule
Border administration	CBSA Customs Notice / CARM instructions
Remission	Remission orders + Finance remission process

Who ultimately bears the cost?

The importer faces the customs accounting obligation, but the economic burden can be shared or shifted. A U.S. exporter may discount; a Canadian importer may absorb; a manufacturer may change suppliers; a retailer may pass through cost; a customer may substitute. Customs liability and economic incidence are related, but they are not the same question.

Authorities

Research cutoff: September 7, 2026. Federal Claims Advisors separates announced measures from operative instruments and updates status after primary-source verification.