November 08, 2018
Canada Application of the United States Surtax Remission Order
On October 11, 2018, Canada Border Services Agency (CBSA) published Customs Notice 18-16 which provides information on the application of the United States Surtax Remission Order.
Provided the goods are qualifying goods in the U.S. Surtax Remission Order and no other claim for relief (drawback) has been claimed, Canadian importers may:
- Obtain a refund of surtaxes paid retroactively to July 1, 2018
- Proactively apply this remission to relieve payment of applicable surtaxes going forward upon import
Under certain conditions, the U.S. Surtax Remission order relieves the surtaxes imposed by the U.S. Surtax Orders SOR/2018-152 and SOR/2018-153 which were effective on July 1, 2018:
- Goods listed in Schedule 1 and Schedule 2 of the remission order:
o Schedule 1: determined to be in “ongoing short supply.” Relief is granted for an indefinite period for products imported from the U.S. on or after July 1, 2018.
o Schedule 2: determined to be in “temporary short supply.” Relief is granted for a limited period for products imported from the U.S. from July 1, 2018 to December 31, 2018.
- Goods classified under tariff item No. 8903.10.00, 8903.91.00, 8903.92.00 or 8903.99.90, excluding those that have been exported from Canada and then re-imported into Canada.
- “Goods temporarily imported into Canada for the purposes of repair, alteration, or storage, including those classified under tariff item No. 8903.10.00, 8903.91.00, 8903.92.00 or 8903.99.90 that have been exported from Canada.”
For goods considered as ‘qualifying’ under the remission, the following applies:
- Good must be of U.S. origin
- HS/tariff item must be listed on Schedule 1 or Schedule 2, please note that certain HS are listed on both Schedules
- The description associated with the HS/tariff items on Schedule 1 and 2 must be an exact match to the product imported.
- As the validity period is different between the two Schedules, importers need to confirm which description, under which Schedule applies, this will determine the applicability period.
- Evidence demonstrating inability to source the product, or substitutes, from Canadian or non-U.S. suppliers, including the names of companies canvassed and, if possible, copies of replies from these companies. Relevant company information on the sourcing model may be required.
Importers taking advantage of this remission of surtaxes should exercise all necessary due diligence to ensure applicability, as subsequent CBSA/Finance audit activity may result.
For more information, please contact your local FedEx Trade Networks Transport & Brokerage office. For a complete list of office locations, go to ftn.fedex.com/us/locations.
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