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Updated: Memorandum D18-5-1: Coding Excise and GST exemption codes in the CBSA Assessment and Revenue Management (CARM) system

https://www.cbsa-asfc.gc.ca/publications/dm-md/d18/d18-5-1-eng.html

Ottawa, March 4, 2025

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This Memorandum is the reference document for applicable excise codes and applicable GST exemption codes available in the CBSA Assessment and Revenue Management (CARM).

Plain language summary

  • Target audience: Importers of commercial goods
  • Key content: Provide an overview of the changes on excise and GST in CARM; provide information on the different excise codes, excise exemption codes and GST exemption codes.
  • Keywords: CARM, excise tax, excise duty, cannabis, GST, exemption

On this page

Updates made to this D-memo

This memorandum has been amended to update:

Addition of Nova Scotia vaping product excise codes

Guidelines

Background information

To help importers account for goods and pay duties and taxes owing according to the applicable legislative provisions found in Acts and Regulations such as the Excise Act, the Excise Act, 2001, and the Excise Tax Act, the CBSA has revised the coding system of Excise codes and GST exemption codes, as explained below.

Excise duties, excise taxes, and GST exemptions remain legislated and regulated by the Canada Revenue Agency (CRA), though the responsibility to administer and collect duties and taxes at the border falls onto the CBSA.

The tables found below provide the codes’ uses and guidance on where to find the information. The tables are separated by code type:

  • Excise duties (alcohol, tobacco, cannabis and vaping products)
  • Excise taxes (fuel-inefficient vehicles, automobile air conditioners, certain petroleum products, and Luxury Tax)
    • for the purpose of this memorandum, charges and specialty taxes are considered excise taxes
  • Excise exemptions
  • GST exemptions

CBSA Assessment and Revenue Management (CARM)

CARM’s new Commercial Accounting Declaration (CAD) only allows for a single excise code to be selected per line, and provides the proper fields to account for the information relating to the goods.

Goods that can incur more than one excise charge, such as luxury vehicles and cannabis products, now have designated codes to allow a single code to account for multiple applicable excise charges. These codes cover all possible importation scenarios where multiple codes could apply, such as when the Luxury tax applies with the Air Conditioning Tax on a vehicle, or when both federal and provincial (additional) duties on cannabis apply to a hand lotion.

The Luxury codes are tabled below under “Excise taxes,” and the Cannabis codes are tabled under “Excise duties.”

Luxury vehicles

Existing codes for Luxury vehicles found in Memorandum 18-4-1: Select Luxury Items Tax on Importation, are unchanged and remain valid, though they are to be used for instances where only the Luxury Tax on vehicles apply.

In cases where multiple excise tax scenarios apply (e.g., when the luxury vehicle is also subject to the excise tax on fuel-inefficient vehicles and/or the Air Conditioner’s Tax), L-codes were created for each possible combination of these different three excise taxes.

It is the importer’s responsibility to review the list of codes and, based on their goods, select the code that pertains to their importation from the drop down list of the Excise Tax Code field on the CAD.

Below are examples of importation scenarios using the new L-codes:

Example 1

The vehicle is imported by a Registered Vendor which is exempt from Luxury tax. The vehicle has a weighted average fuel consumption rating of at least 13 L but less than 14 L per 100 kilometers, and is subject to the air conditioners excise tax. In this case, code L26 is to be selected.

Figure 01

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Example 2

The lowest rate of luxury tax determined for an imported luxury vehicle is 20% of the taxable amount above $100,000 of the vehicle. The vehicle also has a weighted average fuel consumption rating of 16 L or more per 100 kilometers, but is not subject to the air conditioners excise tax. In this case, code L04 is to be selected.

Figure 02

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Example 3

The lowest rate of luxury tax determined for an imported luxury vehicle is 10% of the value of the vehicle. The vehicle also has a weighted average fuel consumption rating of at least 14 L but less than 15 L per 100 kilometers, and is subject to the air conditioners excise tax. In this case, code L17 is to be selected.

Figure 03

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Example 4

The vehicle is conditionally exempt from luxury tax, but is subject to the automobile air conditioners excise tax. In this case, code L35 is to be selected.

Figure 04

Text version

Cannabis products

Cannabis excise codes have been created to account for the combination of Federal and Additional (Provincial) excise duties and group them together, therefore eliminating codes E50-E57 effective May 13, 2024.

It is the importer’s responsibility to review the list of codes and, based on their goods, select the code that pertains to their importation from the drop down list of the Excise Tax Code field on the CAD.

Below are examples of importation scenarios using the new C-codes:

Example 1

Baked goods not containing cannabis are being imported into Canada. As the excise duty does not apply to goods without cannabis, code C00 is to be selected.

Figure 05

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Example 2

Cannabis viable seeds are being imported into Manitoba. As only the federal excise duty applies to goods imported in Manitoba, code C03 is to be selected.

Figure 06

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Example 3

A vegetative cannabis plant is being imported and destined for Ontario. Based on the amount to be imported, the Federal and Additional (Provincial) excise duties to be paid are both higher when the specified rate is selected. In this case, code C14 is to be selected.

Figure 07

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Example 4

Hand lotion containing cannabis is imported into British-Columbia. Topical goods containing cannabis only incur Federal excise duties for the time being, as the current rate for additional (Provincial) excise duties is set at 0%. In this case, code C16 is to be selected.

Figure 08

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Example 5

Cannabis viable seeds are being imported into New Brunswick. Based on the amount imported, the Federal ad valorem rate is higher, while the Additional (Provincial) rate is higher in its specified rate. In this case, code C20 is to be selected.

Figure 09

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Excise Framework

Currently, all excisable goods fall under a specific excise tax code in order for all excise duties and taxes to be relieved should an excise exemption code apply to the commodity being imported.

For example, Lager (classified under 2203.00.00.31) now falls under Excise Code E33. If imported for Ships’ stores purposes, Excise exemption code E91 now relieves the excise duties because the commodity is placed under an excise tax code, not linked via the HS classification itself.

Removal of codes

The CBSA’s review revealed that some codes had been repealed, misinterpreted or duplicated. In order to streamline and modernise the Excise Framework, the codes no longer in effect or applicable to CARM have been removed.

For a complete list of codes that were removed, as well as the reasoning, refer to Appendix E.

Validations

System validations have been added to Excise and GST exemption codes (Appendix D) in CARM. These not only link potentially applicable codes to the appropriate Tariff Classification numbers, but can also be further validated wherein specific commodity qualifications, such as Alcohol percentage or Province of Destination, must be entered in the system for it to accept the CAD.

For example, Excise Code E11 applies to wines more than 1.2% or equal to 7% of absolute ethyl alcohol by volume. In this case, the validation includes alcohol percentage, meaning it must be entered on the CAD to accept the code and proceed to the next step.

Rate types

Below are the different rate types found in the Excise Framework, and a definition for each:

  • Specified: A dollar or cent amount is applied as an excise charge. This charge is calculated automatically in CARM.
  • Ad Valorem: A percentage amount is applied as an excise charge. This charge is calculated automatically in CARM.
  • Accept Rate: The importer is responsible for determining the amount owed. The amount owing is to be manually calculated and entered on the CAD.
  • Free: An amount of $0.00 is applied and calculated automatically in CARM. This rate type is reserved for Excise and GST exemption codes.
  • Non-applicable: No value is applicable as an excise charge. This rate type is reserved for C00, and E93.

See link for Appendices  

 

References

Consult these resources for further information.

Applicable legislation

Related D memoranda

Issuing office

Trade Policy Division
Trade and Anti-dumping Directorate
Commercial and Trade Branch

Contact us

Contact border information services

Related links

Page details

Date modified:

2026-03-04

Topic(s)

CBSA Assessment and Revenue Management (CARM)
CBSA Policies & Decisions

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.