The measures were introduced by Canada in response to U.S. Section 338 tariffs imposed on Canadian goods.
What Importers Need to Know
The surtax applies to specified U.S.-origin goods listed in the schedules to the United States Surtax Order (2026). The applicable surtax is calculated as a percentage of the value for duty:
- 15% surtax – goods listed in Schedule 1
- 25% surtax – goods listed in Schedule 2
- 50% surtax – goods listed in Schedule 3
The surtax applies to both commercial and casual imports, including U.S.-origin goods exported to Canada from a third country.
Importantly, the measure is based on origin rather than country of export. Goods must therefore be reviewed to determine whether they qualify as U.S.-origin under Canada’s applicable marking rules.
Key Exceptions and Considerations
Certain goods may not be subject to the surtax, including:
- U.S.-origin goods that were already in transit to Canada when the surtax came into effect, provided appropriate supporting documentation is available.
- Most goods classified under Chapters 98 and 99, unless the applicable tariff item is specifically listed in Schedule 4 of the Order.
- Certain returning goods, temporary imports, repaired or altered goods, eligible ships’ stores, and qualifying goods imported under the Import for Re-Export Program.
- Goods eligible for remission under certain existing remission programs.
Where a product would otherwise be subject to both the United States Surtax Order (2026) and the Steel Derivative Goods Surtax Order, only the surtax under the United States Surtax Order (2026) applies. The two surtaxes are not cumulative.
Importers should also note that the surtax may apply to shipments that fall within de minimis thresholds.
Canada’s Duties Relief and Duty Drawback Programs may be available for surtax paid or payable, subject to applicable requirements.
Accounting Requirements
Importers must declare applicable surtaxes when completing the Commercial Accounting Declaration (CAD) through CARM.
The applicable surtax codes are:
- 26186A – 15% surtax
- 26186B – 25% surtax
- 26186C – 50% surtax
The surtax amount must be reported in Field 85 – Surtax of the CAD.
Importers are responsible for ensuring that the correct origin, tariff classification, value for duty, and surtax treatment are declared. CBSA may conduct examinations and post-release verifications, and non-compliance may result in additional duties, penalties, and interest.
Recommended Actions
Buckland recommends that importers:
- Review their Canadian imports to identify products included in the surtax schedules.
- Confirm the country of origin and tariff classification of affected goods.
- Review shipments that were in transit before September 8 and retain supporting transportation documentation where an exception may apply.
- Evaluate whether any available remission, duties relief, or drawback provisions apply.
- Review pricing and landed-cost impacts associated with the additional surtax.
The Government of Canada has also established a remission framework for importers seeking transitional relief on certain U.S.-origin products.
For the complete list of products and applicable surtax rates, please refer to the Government of Canada’s Complete List of U.S. Products Subject to Counter Tariffs.
If you have questions regarding how these surtaxes may affect your imports into Canada, please contact your Buckland representative for assistance.