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Import duty & taxes when importing into Canada
Overview

Import duty and taxes are due when importing goods into Canada whether by a private individual or a commercial entity. The duty valuation method is FOB (Free on Board), which means that the import duty is calculated exclusively on the value of the imported goods.  In addition to duty, imports may be subject to other taxes such as GST/PST/HST and excise.

Duty Rates

Duty rates in Canada range between 0% and 35%, where the average duty rate is 8.56%.  Some goods are not subject to duty (e.g. certain electronic products, antiques, etc.).

Preferential duty rates

Canada has signed free trade agreements with a number of countries.  To be entitled to preferential tariff treatment, a good must meet the “originating” criteria as set out on the Rules of Origin of individual FTAs.  A certificate of origin is required upon importation, when the value of an import is greater than CA$1600, for preferential duty rates to apply.

NB:

  • If the benefit of preferential tariff treatment under NAFTA, CCFTA, CCRFTA, CPFTA or CCOFTA is claimed for casual goods (i.e. goods other than commercial goods), the importer and owner of the goods are exempt from the Certificate of Origin requirements, provided that certain conditions are met.
  • If the benefit of preferential tariff treatment under NAFTA, CCFTA, CCRFTA, CPFTA or CCOFTA is claimed for commercial goods whose estimated value for duty is less than $1,600, the importer and owner of the goods are exempt from the Certificate of Origin requirements, provided that certain conditions are met.
Sales Tax

In Canada there are three types of sales tax: a federal Goods and Services Tax (GST) at a rate of 5%, a provincial sales tax (PST) which rate varies by province, and a combination of both, a Harmonized Sales Tax (HST) Commercial importers are only subject to GST.  Private importers are subject to GST, PST or HST. Sales tax is calculated based on the sum of the value of the goods, the duty, and the excise duty (if applicable). The amount of sales tax due depends on the place of residence of the importer rather than on the location where the goods enter Canada. The table below outlines the sales tax rates in the different provinces:

Province Code Sales 
tax type
Provincial
rate
Combined effective rate
Alberta AB GST 0% 5%
British Columbia BC GST + PST 7% 12%
Manitoba MB GST + PST 8% 13%
New Brunswick NB HST 10% 15%
Newfoundland and Labrador NL HST 10% 15%
Northwest Territories NT GST 0% 5%
Nova Scotia NS HST 10% 15%
Nunavut NU GST 0% 5%
Ontario ON HST 8% 13%
Prince Edward Island PE GST + PST 10% 15%
Quebec QC GST + QST 9.975% 14.975%
Saskatchewan SK GST + PST 6% 11%
Yukon YT GST 0% 5%
Minimum thresholds

Duty and GST/PST/HST are not charged if the FOB value, i.e. the value of the goods excluding shipping and insurance cost, does not exceed CA$20.00.

Other taxes and custom fees

Excise fee is applicable on alcohol and tobacco products.  It is based on FOB but also on quantity measurements and alcohol content in case of alcohol products.

Duty and tax refunds

In case of overpayment of duty and taxes or returns of imported products to the seller, the importer might be entitled to a duty and tax refund.

Local Customs office and contacts

More information on import declaration procedures and import restrictions can be found at Canada Border Agency Services.

 

Original resource: dutycalculator.com

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