Customs Notice 25-24: Order Imposing a Surtax on the Importation of Certain Steel Goods
June 27, 2025
The Government of Canada is implementing a surtax on certain steel goods effective June 27, 2025. This measure aims to prevent steel trade diversion into Canada due to U.S. tariffs. The Canada Border Services Agency (CBSA) will administer the surtax under the Customs Tariff and Customs Act, and Global Affairs Canada (GAC) will manage import permits for affected goods.
Below is a summary of Customs Notice 25-24. To review the complete Customs Notice, please click on the link below:
Customs Notice 25-24: Order Imposing a Surtax on the Importation of Certain Steel Goods
Application
- Effective Date: A 50% surtax on certain steel goods imported into Canada will take effect on June 27, 2025.
- Surtax Application: The surtax applies to imports exceeding specified tariff rate quotas (TRQ) for various steel products from non-free trade agreement countries.
- Quota Management: Annual quotas are divided quarterly, allowing unused amounts to carry over. Exceeding these quotas results in a 50% surtax.
- Permit Requirement: Importers need a shipment-specific permit to declare imports under the TRQ. Without it, the surtax applies automatically.
- Monitoring and Refunds: The GAC monitors quota utilization. Importers can request refunds for surtaxes paid on shipments imported without a permit if they later obtain one.
- Country of Origin: The surtax is determined based on the country of origin, following specific regulations.
- Commercial Use: The surtax applies to steel goods imported for commercial purposes, including those from countries not listed in the exemption schedule.
- Duties Relief Programs: Canadian businesses may benefit from Duties Relief and Duty Drawback Programs for surtaxes paid under CUSMA provisions.
Proof of origin
- Proof of Origin Requirement: All imported goods must provide proof of origin upon request, as mandated by subsection 35.1(1) of the Customs Act and the Proof of Origin of Imported Goods Regulations.
- Acceptable Documentation: Proof of origin can be presented through various documents, including:
- Commercial invoices
- Canada Customs Invoices
- Other documentation indicating the goods’ country of origin
- Compliance with Trade Agreements: The documentation must align with obligations under free trade agreements and Canada’s Most-Favoured-Nation (MFN) or General Tariff treatment provisions.
Calculation of surtax when accounting for commercial importations
- The surtax on imported steel goods is 50% of the value for duty of the goods.
- This surtax is in accordance with the Order Imposing a Surtax on the Importation of Certain Steel Goods.
- The surtax is additional to any other duties, including:
- Customs duties
- Anti-dumping and countervailing duties
- Other applicable surtaxes and taxes
- It is crucial to note that the surtax applies in addition to any other applicable surtax.
- Please review Customs Notice for calculation examples
Exceptions to surtax
- Surtax Exceptions:
- The surtax does not apply to steel goods in transit to Canada on the effective date of the surtax.
- Importers must have proof of transit, such as shipping documents, to validate the exemption.
- Origin Exemptions:
- Steel goods from countries listed in Schedule 2 of the surtax order are exempt.
- Casual goods, as defined by regulations, are also not subject to the surtax.
- Tariff Item Exemptions:
- Goods classified under Chapter 98 of Canada’s Customs Tariff are exempt, regardless of other classifications.
Accounting
- Importers must present a General Import Permit (GIP) and Country of Melt and Pour (COM) information to release goods into Canada, especially when using the Single Window Integrated Import Declaration (IID).
- Key references include:
- Memorandum D19-10-2: Administration of the Export and Import Permits Act.
- Customs Notice 24-38: Amendments to GIP numbers related to carbon steel and specialty steel products.
- Surtax declaration is mandatory when completing a Commercial Accounting Declaration (CAD) via various platforms (CARM Client Portal, EDI, API).
- Surtax Codes:
- 25148A: Goods imported over the TRQ without a permit (50% surtax).
- 25148B: Goods under a valid shipment-specific permit (no surtax).
- 25148C: Goods under a valid permit, subject to the China Surtax Order (2024).
- 25148D: Multiple surtaxes apply; manual calculation required.
- The amount of surtax is entered in field 85 of the CAD.
- For goods qualifying for surtax exceptions, they must be declared as non-subject to surtax.
- Refer to Memorandum D17-1-10 for guidance on completing the CAD, applicable to goods in the Courier Low Value Shipment (CLVS) Program.
- Goods eligible for remission of customs duties under relevant orders must also be accounted for, even if subject to surtax.
Corrections, re-determinations, and refunds
- Adjustments to Declarations: Corrections or re-determinations must follow the Customs Act and relevant memoranda, specifically D11-6-6 and D6-2-3.
- Self-Assessing Surtax: If surtax is incorrectly self-assessed for commercial goods, adjustments can be submitted via CCP or EDI/API, as detailed in Memorandum D17-2-1.
- Re-determination Process: The origin, tariff classification, and value for duty of imported goods can be re-evaluated under the Customs Act and associated regulations, considering any undeclared surtax.
- Surtax Exceptions: Commercial goods exempt from surtax must be declared as such during accounting.
- Surtax Declaration: When declaring surtax at importation, refer to Memorandum D17-1-10 for guidance on completing the Customs Accounting Document (CAD).
- Remission Eligibility: Goods eligible for remission under the Postal or Courier Imports Remission Orders must still account for any applicable surtax.
Examinations and verifications
Imported goods may be subject to examination at the time of importation and to post-release verification for compliance with the tariff classification, valuation, origin, and any other applicable provisions administered by the CBSA. In cases of non-compliance, in addition to the imposition of surtax, customs duties and taxes, penalties may be assessed, and interest may accrue on the amount owing.
Advance rulings for commercial importations
- National Customs Rulings (NCR): Essential for ensuring predictability and certainty in accounting for goods. Requests must be made to the CBSA before importing goods.
- Advance Rulings: Necessary for determining the origin of goods and entitlement to preferential tariff treatment under Canada’s Free Trade Agreements (FTAs). Applications should be submitted prior to importation.
- Memorandum References:
- D11-11-1: Details on National Customs Rulings.
- D11-4-16: Information on Advance Rulings for Origin Under FTAs.
- D11-11-3: Guidelines for Advance Rulings on Tariff Classification.
- Surtax Considerations: Goods qualifying for surtax exceptions must be declared accordingly during accounting. For details on declaring surtax, refer to D17-1-10.
- Remission of Duties: Goods eligible for remission under specific orders must be accounted for despite any surtax.
Recourse – surtax and appeal process
- Surtax Imposition: The Governor in Council imposes a surtax which is not appealable under the Customs Tariff or the Customs Act.
- CBSA Review: The Canada Border Services Agency (CBSA) reviews accounting documents to confirm the correct surtax declaration.
- Appeal Process:
- Determinations by officers regarding the surtax can be appealed under the Customs Act.
- Individuals receiving a notice of re-determination can request a review within 90 days after ensuring all duties and interest are paid or secured.
- Important Reference: For detailed guidelines, refer to Memorandum D11-6-7, which outlines the request process for re-determination or review by the CBSA.
Should you or your organization have any questions,
please do not hesitate to contact your Dominion Customs Consultants representative,
or feel free to reach us here
