Commentary on Tariff Classification 9948.00.00.00

Further to earlier messages regarding tariff classification 9948.00.00.00, Jean-Marc Clément, a lawyer with BCF Business Law in Montreal, an associate member of the CSCB, has provided commentary on the ongoing issue concerning the use of this classification.

We thank Mr. Clément for his remarks, available below.

The “iPod tax”, Code 9948 and the media

You may have seen a recent article in the Financial Post talking about yet another tariff classification dispute concerning Code 9948, this one scheduled to be heard on October 1st (CITT AP-2013-004, Ubisoft Canada Inc.). The article from the Post is one of many newspaper articles published this year on Code 9948. Most of the other articles centered on the so-called “iPod tax” and the conflict between CBSA and the 9948 Fair Treatment Coalition involving the television and consumer audio industry. Although the Ubisoft appeal involves the video gaming industry, what is particularly interesting to note in the article is the quote found in the closing paragraph: “A 6% tariff is not a lot. I have to wonder how much going through all these steps is costing the company, rather than sucking up and paying the tariff.”

Although newspapers rarely pay attention to tariff matters, Code 9948 changed all that and made several headlines. Bringing these topics to the attention of business people and the general public is a good thing. But what is often reported in those articles shows blatant ignorance of the complexity of cases where tariff issues come to exist in the first place, and then be resolved. Comments like the one referred to above only serve to perpetrate the misunderstanding that tariffs are no big deal and just a cost of doing business. We obviously know better and spend countless hours explaining why this is not so to our clients.

Showcasing customs and tariff issues in the media and raising awareness on these issues is an interesting development, though one that deeply merits input from the trade community.