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Customs Notice 26-23: United States Surtax Order (2026)

https://www.cbsa-asfc.gc.ca/publications/cn-ad/cn26-23-eng.html 

Ottawa, September 7, 2026

1. This notice provides information on the application of the United States Surtax Order (2026), specifically regarding surtax provisions effective September 8, 2026, on certain goods originating in the United States (U.S.).

2. The surtax is introduced by Canada in response to the U.S.’ imposition of Section 338 tariffs on goods imported into the U.S. from Canada. The goods subject to Canada’s surtax are drawn from those targeted by U.S. Section 338 and Section 232 tariffs, with the surtax applicable to each product generally corresponding to the U.S. tariff rate.

3. The administration of the United States Surtax Order (2026) is the responsibility of the Canada Border Services Agency (CBSA).

Application

4. Effective September 8, 2026, certain goods imported into Canada and originating in the U.S. are subject to a surtax of either 15%, 25% or 50% of the value for duty, as applicable, in accordance with the United States Surtax Order (2026). The value for duty is determined in accordance with sections 47 to 55 of the Customs Act. The Schedules to the United States Surtax Order (2026) contain a complete list of goods subject to the surtax and the applicable surtax rate.

5. The surtax will only apply to goods that originate in the U.S., which shall be considered as those goods eligible to be marked as goods of the U.S. in accordance with the Determination of Country of Origin for the Purpose of Marking Goods (CUSMA Countries) Regulations. The surtax does not apply to goods eligible to be marked as originating from Puerto Rico, Guam, the Northern Mariana Islands, American Samoa or the U.S. Virgin Islands.

6. The surtax will apply to goods imported for commercial and casual purposes, even when exported from a country other than the U.S. into Canada.

7. Goods classified under Chapters 98 and 99 are exempted from the surtax, unless the applicable Chapter 98 or 99 tariff item is specifically listed in Schedule 4 to the Order. This exemption applies even where the goods' otherwise applicable tariff classification is listed in Schedule 1, 2 or 3 to the Order.

8. Where goods are subject to a surtax under both this Order and the Steel Derivative Goods Surtax Order, only the surtax imposed under this Order applies. The surtaxes from these two Orders are not cumulative.

9. The surtax applies to goods that originate in the U.S., including those that may be eligible for the remission of customs duties, sales and/or excise taxes under the Postal Imports Remission Order or the Courier Imports Remission Order. Surtax is applicable on shipments that fall under de minimis thresholds.

10. The surtax is remitted for commercial and casual goods eligible for remission under the Akwesasne Residents Remission Order.

11. Canada’s Duties Relief and Duty Drawback Programs will be available for surtax paid or payable, subject to the provisions of the Canada-United States-Mexico Agreement (CUSMA). When goods are of CUSMA (US/Mexico) origin, the goods are not subject to the limitations of CUSMA and the “lesser of two duties” determination does not apply. Therefore, the goods may be eligible for full relief, if the CUSMA criteria is met, as outlined in CBSA’s Memorandum D7-4-3: CUSMA Requirements for the Duty Drawback and the Duties Relief Programs

Proof of Origin

12. Pursuant to subsection 35.1(1) of the Customs Act, proof of origin must be furnished for all imported goods subject to exceptions set out in the Proof of Origin of Imported Goods Regulations and Customs Notice 20-22: The Canada-United States-Mexico Agreement’s (CUSMA) Regulatory Amendments and New Regulations Made Pursuant to the Customs Act.

13. For commercial goods, proof of origin may be in the form of a commercial invoice or any other documentation that contains the minimum data elements as set out in Annex 5-A (Minimum Data Elements) of CUSMA and replicated in Appendix H of Memorandum D11-4-2: Proof of Origin of Imported Goods.

14. Personal importations of goods, also known as casual goods (meaning goods that are imported into Canada other than commercial goods) are considered to originate in the U.S. when the goods are marked as a good of the U.S.

15. Casual goods imported from a country other than the U.S. that are marked as made in, produced in or originating in the U.S. are considered to originate in the U.S.

Calculation of Surtax when Accounting for Commercial Importations

16. The amount of surtax payable is calculated in the amount of either 15%, 25% or 50% of the value for duty of the imported good in accordance with the United States Surtax Order (2026). This is in addition to any other duties owing (e.g. in addition to anti-dumping duties that may be applicable).

Example 1: Calculation of a 25% surtax on imports.

The value for duty (VFD) of an imported good subject to a surtax is $150. The imported good has a Most Favoured Nation (MFN) duty rate of 0%. The applicable surtax is 25%, as per the Schedule 2 to the United States Surtax Order (2026).

The amount of surtax is calculated as follows:

$150 (VFD)×0.25 (% surtax)=$37.50 (surtax payable).

Customs duties and taxes are to be calculated as follows:

$150 (VFD)×0 (% MFN duty)=$0 (customs duty)

$150 (VFD)+$37.50 (surtax payable)+$0 (customs duty)=$187.50 (value for tax)

$187.50×0.05 (% GST)=$9.38 (GST)

Total of surtax, customs duty, and GST payable is$37.50+$9.38=$46.88

Example 2: Calculation of a 50% surtax on imports.

The value for duty (VFD) of an imported good subject to a surtax is $150. The imported good has a Most Favoured Nation (MFN) duty rate of 0%. The applicable surtax is 50%, as per the Schedule 3 to the United States Surtax Order (2026).

The amount of surtax is calculated as follows:

$150 (VFD)x0.5 (% surtax)=$75 (surtax payable).

Customs duties and taxes are to be calculated as follows:

$150 (VFD)x0 (% MFN duty)=$0 (customs duty)

$150 (VFD)+$75 (surtax payable)+$0 (customs duty)=$225 (value for tax)

$225x0.05 (% GST)=$11.25 (GST)

Total of surtax, customs duty, and GST payable is$75+$11.25=$86.25

Example 3:

The value for duty (VFD) of an imported good subject to a surtax is $150. The imported good has a Most Favoured Nation (MFN) duty rate of 5% and is subject to anti-dumping duties of $34. The applicable surtax is 25%, as per the Schedule 2 to the United States Surtax Order (2026).

The amount of surtax is calculated as follows:

$150 (VFD)x0.25 (% surtax)=$37.50 (surtax payable).

Customs duties and taxes are to be calculated as follows:

$150 (VFD)x0.05 (% MFN duty)=$7.50 (customs duty)

$150 (VFD)+$37.50 (surtax payable)+$7.50 (customs duty)+$34.00 (anti-dumping duties)=$229.00 (value for tax)

$229.00x0.05 (% GST)=$11.45 (GST)

Total of surtax, customs duty, anti-dumping duty, and GST payable is$37.50+$34.00+$7.50+$11.45=$90.45

17. The value for duty must be determined in accordance with sections 47 to 55 of the Customs Act. Refer to the Customs valuation handbook for more details. GST payable is calculated on the value for tax, which is inclusive of surtax even when customs duties are remitted. However, GST is not payable on non-taxable importations, even if the importation is subject to the surtax.

18. Under the transaction value method, transportation and associated costs, and insurance costs, arising after the place from which goods begin their direct and uninterrupted journey to Canada would not be included in the transaction value of the goods. Any amounts for Canadian customs brokerage fees which are included in the price paid or payable may be deducted as associated costs and as such are not included in the transaction value of the goods. Estimates of the transportation costs are not acceptable. Refer to Memorandum D13-3-3: Transportation and Associated Costs, Memorandum D13-3-4: Place of Direct Shipment, and Memorandum D13-4-7: Adjustments to the Price Paid or Payable (Customs Act, Section 48) for details.

Exceptions to Surtax

19. The surtax will not apply to U.S. goods that are in transit to Canada on the day on which the surtax comes into force. This includes goods that were in transit before the surtax comes into force. For the purpose of this Customs Notice, ‘in transit to Canada’ refers to goods bound for but not yet arrived in Canada, and under the control of a carrier. Importers must have proof in their possession that such goods were in transit to Canada in order to demonstrate that the surtax is not applicable. Such proof may include the following documentation: shipping documents (for example, a bill of lading), report of entry documents, and cargo control documents. Such proof may be requested at any time by a CBSA officer.

20. The surtax will not apply to goods that are imported from the United States at a port of entry on Campobello Island, New Brunswick, if the goods are imported by a person who ordinarily resides on Campobello Island and who is returning after an absence from Canada of less than 24 hours, are in the person’s possession or form part of their baggage, and are for personal or household use. CBSA officers may request proof of residency to apply this exception.

21. The surtax will not apply to goods under the authority of a permit issued under subsection 8.3(3) of the Export and Import Permits Act, where the permit specifies that it is issued for purposes of the Import for Re-Export Program. Such goods must meet all of the conditions of that program, including further processing in Canada and exportation within the specified timelines.

22. In the following scenarios and in accordance with the United States Surtax Order (2026), the importation would not be subject to the surtax:

  • Returning goods that are made in the U.S. and previously imported into Canada and duty-paid – for example, a Canadian tourist or businessperson is returning from the U.S. with goods (such goods would have previously been released and accounted for under the Customs Act before its sale to the Canadian owner).
  • Goods that are made in the U.S. and are repaired or altered across the border, excluding vessels returned to Canada after foreign repair or alteration (i.e., goods of 9971.00.00) – for example, a good in the U.S. might require repair in Canada before being exported back to the U.S., or vice versa. If the good was in Canada, it must have already been duty paid (e.g., goods of 9993.00.00 or 9992.00.00). For details, refer to Memorandum D8-2-26: Goods Returned After Repair or Alteration in the United States, Mexico, Chile, Israel or Another CIFTA Beneficiary, Colombia, Costa Rica, Peru, Jordan or Panama.
  • Baggage and conveyances temporarily imported by a person who is not a resident of Canada for use by that person in Canada (i.e., goods of 9803.00.00). For details, refer to Memorandum D2-1-1: Temporary Importation of Baggage and Conveyances by Non-residents. Examples of goods that fall under 9803.00.00 include food and beverages, personal care products, household supplies, health-related items like vitamins or over-the-counter medication for personal use, and baby items.
  • Eligible ships’ stores that are not diverted (e.g., broken the sealing requirement) are not subject to surtax. Refer to Memorandum D4-2-1: Ships’ Stores for details. For more information on relief from taxes and duties (including surtax) imposed on imported goods used as Ships’ Stores, refer to the Ships’ Stores Regulations.

23. A qualifying individual returning to Canada may import goods up to a certain value into Canada without paying customs duty and taxes. Surtaxes may apply to goods that do not qualify for an exemption. Surtaxes will apply on all other goods not subject to personal exemptions and on those goods the value of which exceeds the value of the personal exemption. For more information, visit the Guide for residents returning to Canada.

Accounting

24. Importers must declare imported goods as subject to a surtax when completing a Commercial Accounting Declaration (CAD) via CARM Client Portal (CCP), Electronic Data Interchange (EDI) or Application Programming Interface (API) and declare the applicable surtax code as seen below:

  • for goods subject to 15% of the value for duty (items listed in schedule 1), the surtax code is 26186A;
  • for goods subject to 25% of the value for duty (items listed in schedule 2) the surtax code is 26186B; or
  • for goods subject to 50% value for duty (items listed in schedule 3), the surtax code is 26186C.

25. The amount of surtax owing is entered in field 85 “Surtax” of the CAD. If importers elect to use the self-declare option in CARM, the amount of surtax owing must be calculated by the importer and entered in the Surtax field.

26. Accounting for surtax under the United States Surtax Order (2026) will follow the instructions outlined in Memorandum D16-1-1: Information pertaining to the application, collection, and adjustment of a surtax.

27. Commercial goods qualifying for an exception to a surtax must be declared as non-subject to surtax at the time of accounting.

28. When an amount of surtax is being declared at importation, refer to Memorandum D17-1-10: Coding of Customs Accounting Documents for additional information on completing the CAD. This also applies to goods released and accounted for in the Courier Low Value Shipment (CLVS) Program.

29. Goods eligible for the remission of customs duties, sales and excise taxes under the Postal Imports Remission Order or the Courier Imports Remission Order and subject to a surtax must be accounted for.

30. Casual goods will be accounted for in accordance with Memorandum D17-1-3: Casual Importations.

Corrections, Re-Determinations, and Refunds

31. Corrections or adjustments to original declarations and requests for re-determinations are to be made in the prescribed form and manner under the relevant provisions of the Customs Act, in accordance with the procedures outlined in Memorandum D11-6-6: “Reason to Believe” and Self-Adjustments to Declarations of Origin, Tariff Classification, and Value for Duty, Memorandum D6-2-3: Refund of Duties and Memorandum D6-2-6: Refund of Duties and Taxes on Non-commercial Importations. This also includes goods released and accounted for in the CLVS Program.

32. If surtax was not correctly self-assessed or was self-assessed in error for commercial goods, then an adjustment or correction to the CAD, as applicable, may be submitted via the CCP or via EDI/API. For more information on how to submit an adjustment for commercial goods, refer to Memorandum D17-2-1: Adjusting Commercial Accounting Declarations. An adjustment to a CAD may only be made after the payment due date and within the legislative time frame. Changes required before the payment due date may be submitted as a correction, as per Memorandum D17-1-5: Accounting for Commercial Goods.

33. If an adjustment is required for casual goods, including those accounted for on a CAD, a request must be made using a Form B2G, CBSA Informal Adjustment Request. Adjustments for casual goods cannot be submitted through CARM. For more information on refunds for casual goods please refer to Memorandum D6-2-6, Refund of Duties and Taxes on Non-Commercial Importations.

34. The origin, tariff classification, and value for duty of imported goods may be re-determined or further re-determined in accordance with the Customs Act and the Determination, Re-determination and Further Re-determination of Origin, Tariff Classification and Value for Duty Regulations. This may occur further to a self-adjustment. In so doing, as with customs duties and taxes, the CBSA may consider the applicability of any undeclared amount of surtax.

Examinations and Verifications

35. Imported goods may be subject to examination at the time of importation and to post-release verification for compliance with the Tariff Classification, Valuation, Origin, and any other applicable provisions administered by the CBSA. In cases of non-compliance, in addition to the imposition of surtax, customs duties and taxes, penalties may be assessed, and interest may accrue on the amount owing.

Advance Rulings for Commercial Importations

36. For predictability and certainty on how goods are to be accounted for, a binding ruling on the Free Trade Agreement (FTA) Origin, tariff classification, or marking of goods imported from a Canada-United States-Mexico Agreement (CUSMA) country in advance of the importation of goods can be requested under the Customs Act. Refer to the Rulings for tariff classification, valuation, origin, and marking: Overview and Memorandum D11-4-16: Advance Rulings for Origin Under Free Trade Agreements for additional information. Refer to Memorandum D11-11-3: Advance Rulings for Tariff Classification for additional information on requesting an advance ruling on the tariff classification of goods.

Recourse - Surtax and Appeal process

37. Please be informed that the imposition of a surtax is not subject to appeal under the Customs Tariff or the Customs Act. However, the CBSA reviews accounting documents to ensure that the correct amount of surtax has been self-assessed by the importer. While the surtax itself cannot be appealed, determinations, re-determinations, or further re-determinations made by the CBSA may be subject to appeal under the Customs Act.

38. In accordance with the Customs Act, and section 12 of the Customs Tariff, those who have received a notice of re-determination or further re-determination under s.59(2) of the Act, may request review under s.60 of the Customs Act within 90 days and after having paid amounts owed. Refer to Memorandum D11-6-7: Request under Section 60 of the Customs Act for a Re-determination, a further Re-determination or a Review by the President of the Canada Border Services Agency for details.

Remission

39. The Government has established a remission framework to help importers who may need to seek transitional relief from surtax on products from the United States. For goods not already eligible for remission under the United States Surtax Remission Order (2025), requests for remission continue to be accepted and assessed under the U.S. Remission Framework. Further details on the remission framework, including the application process and eligibility criteria for relief, can be found on the Department of Finance website.

Additional Information

40. Refer to Memorandum D16-1-1: Information pertaining to the application, collection, and adjustment of a surtax, for additional information concerning the administration and enforcement of surtax orders under sections 53(2), 55(1), 60, 63(1), 68(1), 77.1(2), 77.6(2) or 78(1) of the Customs Tariff.

41. For more information call the Border Information Service (BIS) at 1-800-461-9999 (toll-free in Canada and the USA). If calling outside Canada and the United States, call 1-204-983-3500 or 1-506-636-5064. Long distance charges will apply. Our automated telephony service provides general information in English and French on CBSA programs, services and initiatives through recorded scripts. Live agents are also available to assist you Monday to Friday 8 am to 4 pm local time, as per time zones in Canada and USA (closed on federal statutory holidays). TTY is also available within Canada: 1-866-335-3237. Alternatively, you may send your enquiries using our Client Support Contact Form.

Related Links

Topic(s)

U.S. Tariffs and Canadian Retaliatory Surtax
Security and Trade Facilitation Programs
International Trade and Border Management

Information source

Canada Border Services Agency (CBSA)
Disclaimer

The foregoing information is provided for informational purposes only and is not intended as, nor should it be considered, professional advice or a substitute for conducting your own thorough research and review. Before making any decisions or taking any action based on the information provided, you should conduct your own independent investigation and/or seek professional advice from a qualified expert in the relevant field. The CSCB disclaims all liability for actions taken or not taken based on the information provided.