eCommerce News
Are you affected by Canada’s counter-tariffs? A step-by-step check for brands selling into Canada
Your goods are affected only if they both mark as US-origin under CUSMA marking rules and appear by specific tariff line on Canada’s counter-tariff schedule. Category alone does not decide it. Several personal care lines widely reported as affected are not actually on the list, and a brand that thinks of itself as one category is usually five or six separate tariff lines, each with its own answer.
Learn How to Make Listings That Convert in 2025!
Read our step-by-step guide on how to optimize your listings using Rufus AI insights. Sign up for our newsletter and get your copy for free!
Show me howCanada’s counter-tariffs took effect at 12:01 a.m. on September 8, 2026. The measures apply surtaxes of 15, 25 and 50 percent on roughly C$27.6 billion of US goods, with each rate matched to the corresponding US tariff on Canadian goods. The six checks below walk you through whether your catalog is on that list, and if it is, what to do next.
The short version
If you want the fifteen-second answer before reading the detail, run through these six lines:
- You are affected only if you (or your Canadian counterparty) are the importer of record on the goods.
- Your product has to mark as US-origin under Canada’s CUSMA marking rules, a different test than the CUSMA preferential-origin rules used to claim duty-free treatment.
- Your exact ten-digit tariff line has to appear on the schedule. Categories are not the test; tariff lines are.
- The rate (15, 25 or 50 percent) applies to the customs value for duty, not your retail price.
- A handful of exceptions exist, the most useful being goods already in transit to Canada on September 8.
- If you are affected, relief options exist: duty drawback, duties relief, and a remission process for exceptional cases.
Each step below expands one of these lines and tells you exactly where to look.
Who pays Canada’s surtax on US goods?
The surtax is owed by whoever is the importer of record in Canada, not by whoever manufactured the good. That distinction decides who has to run the rest of this check.
Three structures cover the common ways brands sell into Canada. If your brand is the importer of record into a Canadian 3PL or an FBA Canada node, the surtax liability sits with you directly. If a Canadian distributor imports on your behalf, the liability sits with them, though it still shows up in your landed cost the moment they pass it through. If you sell direct-to-consumer on a delivered-duty-unpaid basis, the Canadian customer becomes the importer of record on that specific shipment.
None of these structures lets a brand avoid the surtax by shipping small or shipping direct. CBSA’s Customs Notice 26-23 confirms the surtax applies to goods imported for both commercial and casual purposes, which covers postal and courier shipments. A US brand shipping single units to Canadian customers does not sidestep the measure by staying out of commercial customs entries. Whoever is the importer of record self-declares the surtax and calculates the amount owing; nothing about it is automatic.
How do you know if your product counts as US origin?
This step causes the most confusion, because it looks like a question you already answered when you set up CUSMA duty treatment.
Origin for surtax purposes is determined under the Determination of Country of Origin for the Purpose of Marking Goods (CUSMA Countries) Regulations. These marking rules are a separate and generally less strict test than the CUSMA preferential rules of origin used to claim duty-free treatment. Qualifying for preferential CUSMA treatment and marking as a good of the United States are two different questions, and answering one does not answer the other.
Goods eligible to be marked as originating from Puerto Rico, Guam, the Northern Mariana Islands, American Samoa or the US Virgin Islands are excluded from the surtax, even though those territories are commonly grouped with “US-made” in a spreadsheet.
Origin for marking purposes also turns on where a good was produced, not on the route it took to reach Canada. A product manufactured in a third country that simply passed through a US warehouse before shipping to Canada is not thereby transformed into a US-origin good. The reverse is not true: CBSA’s notice states the surtax applies to goods imported for commercial and casual purposes “even when exported from a country other than the U.S. into Canada,” so a US-origin good does not escape the surtax by routing through a third country on its way to Canada.
Run this check per SKU, not per brand. Origin marking can vary by production run, so the answer for one SKU does not automatically apply to the next one on your listing.
What US products are subject to Canada’s counter-tariffs?
The schedule lists specific ten-digit tariff items, not categories, and the gap between the two is where brands are currently making mistakes.
Personal care is the clearest example. Canada’s published schedule contains exactly five lines from Chapter 33, all carrying a 50 percent surtax:
| Tariff item | Description | Rate |
|---|---|---|
| 3303.00.00 | Perfumes and toilet waters | 50% |
| 3304.10.00 | Lip make-up preparations | 50% |
| 3304.20.00 | Eye make-up preparations | 50% |
| 3304.30.00 | Manicure or pedicure preparations | 50% |
| 3305.90.00 | Hair preparations, classified as “other” | 50% |
Skin care and sunscreen, facial powders, shampoo, oral and dental hygiene products, shaving and deodorant preparations, soap, and general washing preparations do not appear on the schedule at all.
Some coverage of the measures listed sunscreen among the affected products. The confusion has a mechanical explanation: Canada’s schedule repeats the full HS heading text as a prefix on every subheading row, and the heading for tariff heading 3304 reads “including sunscreen or sun tan preparations.” That phrase shows up next to the lip, eye and manicure rows even though sunscreen itself, which sits under a different subheading, is not a listed item. A reader scanning the heading column sees “sunscreen” attached to every 3304 row and assumes it is covered.
The lesson generalizes past beauty. A brand that thinks of itself as one shelf category is usually five or six separate tariff lines, some listed and some not. Sort your Canadian catalog by tariff item rather than by product type, and check each line against the schedule individually.
The published schedule also groups into three broader tiers worth knowing at a glance:
| Rate | Representative categories |
|---|---|
| 50% | Steel and aluminum products previously at 25%, furniture, clothing and apparel, the Chapter 33 personal care lines above |
| 25% | Appliances, dairy products such as cheese, certain steel and aluminum derivative products |
| 15% | Air conditioners, forklifts, certain machinery parts, molds, and some tools |
Do not rely on a tariff-line count to gauge how broad the schedule is; public counts vary depending on how items are grouped, and the C$27.6 billion figure from the official release is the more stable number to cite.
How is Canada’s surtax calculated?
The surtax rate is 15, 25 or 50 percent, set by which schedule your tariff line sits in, and it is charged on the customs value for duty, not on retail price and not on landed cost.
Value for duty is determined under sections 47 to 55 of the Customs Act. GST is then calculated on the value for duty plus the surtax amount, so the true cost increase runs slightly ahead of the headline percentage once tax is included.
Using the method CBSA’s Customs Notice 26-23 lays out: a shipment with a $10,000 value for duty and a 0 percent Most Favoured Nation duty rate, subject to a 50 percent surtax, owes $5,000 in surtax. GST at 5 percent is then calculated on $15,000 (the value for duty plus the surtax), adding $750. The total surtax and GST on that shipment comes to $5,750, before any customs duty that would otherwise apply.
Whoever is the importer of record declares the surtax on the Commercial Accounting Declaration, using code 26186A for the 15 percent schedule, 26186B for 25 percent, or 26186C for 50 percent, with the amount entered in field 85. The amount is self-assessed and calculated manually. There is no system that flags this for you.
What exceptions exist to Canada’s surtax?
Four exceptions cover most of the situations a brand selling into Canada is likely to run into.
Goods already in transit to Canada on September 8, 2026 are exempt. CBSA defines “in transit” as bound for Canada and under a carrier’s control before the surtax took effect, and the importer has to hold proof, such as a bill of lading, a report of entry, or cargo control documents, since a CBSA officer can request it at any time.
Goods classified under Chapters 98 and 99 of the tariff schedule are generally exempt, unless the specific tariff item is separately listed in Schedule 4 to the Order.
Goods previously imported into Canada, duty-paid, and later sold to and returned by the original Canadian purchaser are exempt as returning goods.
Casual, postal and courier shipments remain subject to the surtax. This is the assumption most likely to trip up a direct-to-consumer brand: shipping small parcels through the mail does not avoid the measure, it just moves the accounting into separate casual-goods procedures.
Can you get a refund or remission of Canada’s surtax?
Two relief paths exist if you determine you are affected, and they serve different situations.
Duty drawback and Duties Relief apply to surtax already paid or payable. For goods that qualify as CUSMA-originating, the “lesser of two duties” limitation that normally caps relief does not apply, which can mean full relief where the underlying criteria are met. This matters most for brands that import into Canada and later re-export the same goods.
Remission is the second path, for businesses not already covered by an existing remission order. Canada extended its existing surtax remission framework to these measures, and Finance assesses individual requests, generally where the goods cannot reasonably be sourced domestically or from a non-US supplier, or where exceptional circumstances apply. Requests go to [email protected], and there is no fixed decision timeline published.
The surtax itself is not something you can appeal. What can be reviewed under section 60 of the Customs Act is the underlying tariff classification, origin or valuation determination, which is the practical route if you believe your good was placed on a listed tariff line incorrectly. Corrections to a self-assessment are filed within the legislative timeframes through the CARM Client Portal or EDI/API for commercial goods, or Form B2G for casual goods.
Do Canada’s counter-tariffs apply to Amazon FBA Canada and Walmart.ca?
The six steps above answer whether your product is affected at all. This section covers what changes once you know it is, and it is the part a spreadsheet from a customs broker will not tell you.
Amazon and Walmart have never known your landed cost. If part of your catalog sits on the counter-tariff schedule, your break-even ACoS moved lower on those SKUs the moment the surtax took effect, while unaffected SKUs did not move at all. Neither Seller Central nor Walmart’s ad console flags this. The campaigns on affected SKUs will keep reporting the same ACoS they reported before September 8, against a cost base that is no longer accurate. Re-derive break-even by SKU before touching any bids, and reset targets only on the affected subset rather than across the account.
Passing a surtax straight through to price has a rank cost as well as a margin one. A sharp price increase reduces conversion rate, which feeds organic rank, and rank takes longer to rebuild than a temporary trade measure may last. The right response differs by category and price point: staged price increases, pack-size or bundle changes, shifting promotional weight toward unaffected SKUs, or holding price and accepting thinner margin to protect rank are all reasonable options depending on the brand, and there is no single correct answer across all of them.
Bundles and gift sets that combine a listed item with an unlisted one raise a classification question of their own, one worth flagging to a customs broker rather than guessing at.
If you hold inventory in an FBA Canada node or a Canadian 3PL, the customs entry on that inventory has already happened or is about to. Sell-through timing on pre-September-8 inventory is a real margin variable worth modelling before you decide how to reprice new stock.
Upstream inputs count too. If a Canadian co-packer imports your US-made components or packaging, that cost lands before the finished SKU you have been watching even shows up in your own numbers.
FAQ
Are beauty products subject to Canada’s tariffs?
Only five specific lines: perfumes and toilet waters, lip make-up, eye make-up, manicure or pedicure preparations, and hair preparations classified as “other.” Skin care, sunscreen, shampoo, soap and oral care are not on the schedule.
Is sunscreen subject to Canada’s counter-tariffs?
No. Sunscreen sits under a different subheading than the listed lip, eye and manicure items, even though the shared HS heading text mentions sunscreen. Coverage that lists sunscreen as affected is reading the heading, not the actual listed items.
What is the difference between CUSMA origin and CUSMA marking rules?
CUSMA preferential rules of origin determine whether a good qualifies for duty-free treatment under the trade agreement. CUSMA marking rules, a separate and generally less strict test, determine whether a good is considered a good of the United States for purposes like this surtax. A product can qualify under one test and not the other.
Who pays Canada’s surtax on US goods?
The importer of record in Canada, whoever that is on a given shipment: the brand itself, a Canadian distributor, or a Canadian customer on a delivered-duty-unpaid sale. The surtax is self-assessed and calculated manually by that party.
Are goods in transit exempt from Canada’s surtax?
Yes, if they were already bound for Canada and under a carrier’s control before 12:01 a.m. on September 8, 2026. The importer needs documented proof, such as a bill of lading or cargo control document, on hand.
Can I get a refund or remission of Canada’s surtax?
Duty drawback and Duties Relief apply to surtax already paid on CUSMA-originating goods, particularly for import-and-re-export scenarios. A separate remission process exists for businesses facing exceptional circumstances, submitted to Finance Canada with no fixed decision timeline.
Do Canada’s tariffs apply to Amazon FBA Canada?
Yes. The surtax applies at the point of customs entry, regardless of which platform ultimately sells the product. Inventory entering an FBA Canada node is subject to the same check as inventory going to any other Canadian warehouse.
Does this apply if my product is made in China but ships from a US warehouse?
Generally no. The surtax turns on whether a good is eligible to be marked as originating in the United States, which depends on where it was produced, not on which warehouse it shipped from. Confirm the specific marking determination with a customs broker rather than assuming based on the shipping address alone.
What to do next
Run your Canadian catalog through the six checks above, sorted by tariff line rather than by shelf category. If you are newer to selling on Amazon generally, our first 90 days advertising playbook covers the sequencing questions that come before a cross-border complication like this one.
If part of your catalog just moved into a different margin structure, the ad spend behind it is now buying against numbers that changed on September 8. A free Amazon audit shows you what your current campaigns are actually buying against the new cost base, the same way our audits already surface real budget leaks with real account data.
LET’S DISCOVER WHAT’S POSSIBLE FOR YOUR BRAND
We’re here to listen and uncover opportunities tailored to your unique goals.
Fill out the form to get started, and you’ll walk away with real insights and actionable recommendations—whether we work together or not.
- HANDS-ON LEADERSHIP
- AWARD-WINNING PARTNERSHIPS
- CUSTOM-BUILT SOLUTIONS