Canada implements new US counter-tariffs and doubles rates on most steel and aluminum products

Summary

Effective 8 September 2026, Canada imposed surtaxes of 15%, 25% or 50% on specified US-origin goods. The measures cover CA$27.6 billion of imports and target products including dairy, appliances, agricultural equipment, pulp and paper, clothing, furniture and electronics. Surtax is calculated on the customs value for duty. [orders-in-….canada.ca], [cbsa-asfc.gc.ca], [canada.ca]
Canada also increased the surtax on most US-origin steel and aluminum products from 25% to 50%. Selected products remain at 25%, including aluminum goods under tariff heading 7615 and specified steel articles. Goods already in transit to Canada on 8 September remain subject to the previously applicable treatment. [orders-in-….canada.ca], [cbsa-asfc.gc.ca]
Importers should validate tariff classification, US origin, customs valuation and shipment dates, while updating CARM reporting and landed-cost models. Businesses should retain transit evidence and examine Chapter 98 or 99 exceptions, statutory remission, duties-relief and drawback opportunities. Surtax may also increase import GST and working-capital requirements. [cbsa-asfc.gc.ca], [cbsa-asfc.gc.ca], [canada.ca]

Article

Canada has implemented a new round of counter-tariffs on imports originating in the United States, following measures announced on 25 August 2026 in response to US tariffs on Canadian goods. The countermeasures, which took effect on 8 September, apply to CA$27.6 billion of imports and focus on sectors identified as particularly exposed to the US measures. [cbsa-asfc.gc.ca], [canada.ca], [globaltaxnews.ey.com]

Under the United States Surtax Order (2026), goods classified under the tariff items in Schedules 1, 2 and 3 are subject to surtax rates of 15%, 25% and 50%, respectively. Covered goods include certain dairy products, household appliances, agricultural and handling equipment, wood and paper products, clothing, electronics, furniture and sporting equipment. The legal schedules, rather than general product descriptions, determine whether an import is affected. [orders-in-….canada.ca], [canada.ca]

The surtax applies to the goods’ value for duty, determined under the Customs Act. Origin is based on whether goods are eligible to be marked as goods of the United States under the applicable CUSMA marking rules. Consequently, US-origin goods may be taxable even when shipped to Canada from another country. The measure applies to commercial and casual imports, including certain low-value courier and postal shipments. [orders-in-….canada.ca], [cbsa-asfc.gc.ca]

A separate amending order raises the surtax from 25% to 50% for most steel and aluminum goods already covered by the 2025 regime. Aluminum products in Schedule 1 and steel products in Schedule 2 remain at 25%, while products transferred to new Schedules 1.1 and 2.1 attract 50%. For goods in transit on 8 September, the earlier rate continues to apply, subject to documentary evidence showing that the shipment was Canada-bound and under carrier control. [orders-in-….canada.ca], [cbsa-asfc.gc.ca]

The cash-flow effect can extend beyond the surtax itself. Canada Border Services Agency guidance confirms that import GST is generally calculated on a tax base that includes the surtax and other applicable duties. Importers must report the measures through the correct surtax codes in CARM; errors may require corrections or adjustments and may lead to interest or penalties following verification. [cbsa-asfc.gc.ca], [cbsa-asfc.gc.ca]

Businesses should immediately identify affected tariff items, test origin support, confirm valuation and preserve transit records. They should also assess Chapter 98 and 99 treatment, existing remission provisions, duties relief and drawback. Exceptional remission requests may be considered where inputs cannot reasonably be sourced domestically or outside the United States, or where severe economic effects can be demonstrated. [orders-in-….canada.ca], [cbsa-asfc.gc.ca], [canada.ca]

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