Last updated September 28, 2026. Canada’s counter-tariffs of 15, 25, or 50 per cent on listed U.S.-origin goods took effect September 8, 2026. This guide explains the landed-cost impact using the calculation method confirmed in CBSA Customs Notice 26-23, published September 7.
A tariff rate is easy to quote. Its effect on cash, unit cost, pricing, and margin is harder to see. A purchase order that looked profitable when it was approved can become a very different transaction once the surtax, GST cash requirement, freight, brokerage, and carrying costs are combined.
If you have not yet confirmed whether your products are affected, start with our September 8 counter-tariff importer guide and the official Finance Canada product list.
September 28 update: keep the trade measures separate
Canada’s published counter-tariff rates remain 15, 25, or 50 per cent on the listed U.S.-origin goods as of this review. The examples below remain valid under their stated assumptions.
The U.S. tariff-coverage changes took effect September 15. CBP’s implementation guidance also narrows eligibility for the zero per cent Section 338 treatment. As of September 28, targeted U.S. import bans remain scheduled for September 29. These measures concern Canadian goods entering the United States; they are not additional Canadian import charges in this worksheet. For southbound orders, check admissibility, the exact tariff line and the legally relevant import date first. An import ban cannot be modelled simply as a higher tariff cost. See our September 29 import-ban guide for the timing and transitional treatment.
Finance Canada’s September 9 statement also confirms the existing canned-vegetable safeguard continues during review of the CITT report. It is a separate measure. CBSA’s scope and exceptions exempt U.S.-origin goods and exclude frozen vegetables. Do not add a blanket 10 per cent to this U.S.-origin example; check eligibility separately when modelling a change of supplier or origin.
What belongs in landed cost?
Landed cost is the full cost of getting a product to the point where your business can use or sell it. Depending on the transaction, it can include:
- the product purchase price and any additions required to establish value for duty;
- regular customs duty, surtax, SIMA amounts, excise duty, or other border charges;
- international and domestic freight, insurance, brokerage, disbursements, and handling;
- foreign-exchange costs and financing; and
- storage, delays, inspection, demurrage, and inventory carrying cost.
The correct starting point for customs calculations is the value for duty, not necessarily the total on an internal landed-cost worksheet. CBSA’s Customs Valuation Handbook explains the valuation methods and the adjustments that may be required.
Under the transaction-value method, CBSA Customs Notice 26-23 says transportation and associated costs after the place of direct shipment can be excluded from value for duty when the requirements are met. Use actual supporting charges, not estimates, for customs valuation. Budget estimates can help forecast operating costs, but do not establish a customs deduction. Avoid counting freight twice when reconciling the customs value with the landed-cost worksheet.
How a surtax enters the customs calculation
Customs Notice 26-23 confirms that the applicable surtax is calculated on value for duty. Regular duty and applicable trade-remedy amounts remain separate. GST is calculated on the value for tax, including surtax; non-taxable importations remain exempt from GST.
The examples below match the final CBSA method under the stated assumptions. A real shipment still requires verification of classification, origin, valuation and relief eligibility.
Worked example: a $100,000 shipment at a 25 per cent surtax
Assume the following:
- Value for duty: $100,000 CAD
- Applicable counter-tariff rate: 25 per cent
- Regular customs duty rate: 0 per cent, used only to isolate the surtax
- No SIMA, excise, or other customs amounts
- GST rate: 5 per cent
| Calculation | Amount |
|---|---|
| Value for duty | $100,000 |
| Regular customs duty | $0 |
| Counter-tariff: $100,000 × 25% | $25,000 |
| Value for tax: $100,000 + $25,000 | $125,000 |
| GST: $125,000 × 5% | $6,250 |
| Surtax and import GST payable | $31,250 |
In this simplified example, the counter-tariff adds $25,000 to the customs transaction. It also increases the GST cash requirement by $1,250 compared with GST calculated on the original $100,000 alone.
A GST-registered business may be able to recover import GST through an input tax credit, depending on its circumstances. That can make GST a cash-flow requirement rather than a permanent product cost. The surtax itself is a different cost. Confirm tax treatment with your accountant or tax adviser.
This example shows the amounts payable, not a single payment date. Actual cash timing depends on your customs payment arrangements and supplier terms. Eligible importers enrolled in Release Prior to Payment with the required financial security can obtain release before paying duties and taxes, then pay by the applicable deadline. Confirm your RPP status and payment deadline when forecasting cash flow.
How the three rates compare
The exact rate depends on the tariff item in Finance Canada’s list. Using the same $100,000 value for duty and the same simplified assumptions, the scenarios look like this:
| Rate | Surtax | Value for tax | GST at 5% | Surtax and import GST payable |
|---|---|---|---|---|
| 15% | $15,000 | $115,000 | $5,750 | $20,750 |
| 25% | $25,000 | $125,000 | $6,250 | $31,250 |
| 50% | $50,000 | $150,000 | $7,500 | $57,500 |
These figures exclude regular customs duty, SIMA, excise, freight, brokerage, and other costs. They are scenarios, not a quote or entry calculation.
Turn the customs calculation into a per-unit cost
Now add the operating costs that sit outside the simplified customs calculation. Assume the same shipment contains 1,000 units and also has:
- $8,000 in freight and insurance not already included in the value-for-duty baseline; and
- $1,200 in brokerage, disbursement, and handling costs.
| Landed-cost component | Shipment | Per unit |
|---|---|---|
| Product/value baseline | $100,000 | $100.00 |
| Freight and insurance | $8,000 | $8.00 |
| Brokerage and handling | $1,200 | $1.20 |
| 25% counter-tariff | $25,000 | $25.00 |
| Landed cost before potentially recoverable GST | $134,200 | $134.20 |
| GST cash requirement | $6,250 | $6.25 |
| Total modelled cash requirement | $140,450 | $140.45 |
Without the surtax, the modelled landed cost before GST would be $109.20 per unit. With the 25 per cent surtax, it becomes $134.20 per unit. If purchasing, finance, and sales are still using the old $109.20 baseline, the business may underprice the product or approve an order without enough cash to meet its payment obligations.
Costs that can make the real result higher
The example isolates one tariff rate. A real entry can be more complex.
Regular customs duty
A product can face regular customs duty as well as a counter-tariff. Do not replace one rate with the other in your model.
SIMA and other trade-remedy amounts
Anti-dumping or countervailing duties under the Special Import Measures Act can apply independently. A product’s classification, origin, exporter, and description all matter.
Foreign exchange
Customs values are converted to Canadian dollars using the applicable exchange rate for customs purposes. Your commercial payment rate or hedge may be different, so finance teams should model both.
Delays and inventory
Classification or origin questions can add storage, handling, demurrage, financing, and stock-out costs. These may be smaller than the surtax percentage but still material to the shipment’s margin.
Check exceptions and accounting before filing
Goods already in transit to Canada under carrier control when the measure began can qualify for an exception; retain shipping evidence. The notice also provides Chapter 98/99 and other exceptions. This surtax does not stack with the Steel Derivative Goods Surtax Order.
Commercial declarations use codes 26186A, 26186B or 26186C for 15, 25 or 50 per cent respectively, with surtax in CAD field 85. CARM corrections apply before the payment due date; adjustments apply afterward within legal time limits. Relief, drawback and remission have eligibility conditions. Review the complete notice with your broker before claiming relief.
A landed-cost checklist for procurement and finance
- Confirm the Canadian tariff classification using complete product information.
- Confirm the country of origin and retain supporting supplier records.
- Match the exact tariff item to Finance Canada’s current list and rate.
- Confirm the value-for-duty method and currency conversion.
- Add regular duty, surtax, SIMA, excise, and the GST cash requirement separately.
- Add freight, insurance, brokerage, handling, storage, and financing without double-counting amounts already included.
- Divide the result by the usable quantity, then test the effect on price and gross margin.
- Recheck the model when the product, supplier, origin, shipment terms, or government rules change.
How Welke can help
A useful landed-cost model starts with reliable customs data. Welke can help your team organize product descriptions, classifications, origin information, shipment values, and timing before the entry reaches the border. We can also coordinate customs brokerage and freight information so procurement and finance are working from the same shipment facts.
Request a quote and send us the product descriptions, tariff codes currently used, origin records, purchase orders, and expected arrival dates for your upcoming imports.
This article provides general planning information, not shipment-specific legal, tax, valuation, or customs advice. Confirm the current rules and the treatment of your goods before importation.