Should Canada Close a Customs Loophole That Benefits Foreign Importers?
Official title: Potential regulatory amendments to the Valuation for Duty Regulations
The Canada Border Services Agency wants to fix a loophole in how imported goods are valued for customs duties. Right now, some foreign companies with minimal Canadian operations pay less duty than Canadian businesses importing the same goods. The proposed changes would define what counts as a 'sale for export to Canada' and ensure companies need a real presence here to benefit from certain valuation methods.
Why This Matters
This is mostly about leveling the playing field for Canadian importers and businesses. If you run a company that imports goods, you might be paying more in customs duties than foreign competitors with shell operations in Canada. Closing this loophole could mean fairer competition for Canadian businesses.
What Could Change
Companies would need a substantial Canadian presence to use certain customs valuation methods. That means having a real office here, making decisions in Canada, keeping books and bank accounts here, and paying Canadian income tax. Consignment arrangements and sales between Canadian entities would be treated differently for duty calculations.
Key Issues
- Do the revised regulations address concerns about domestic sales being unintentionally included as 'sales for export to Canada'?
- Are the proposed changes aligned with the World Customs Organization's Customs Valuation Agreement?
- What conditions should businesses meet to demonstrate a 'substantial presence' in Canada?
How to Participate
- Review the summary of proposed revisions to understand the three key changes being considered.
- Email your feedback on the proposed revisions to ctpd/dpsce@cbsa-asfc.gc.ca.
- Complete the survey to help CBSA understand how your business values and imports goods (about 30 minutes).
Submit Your Input
Questions Being Asked (4)
- Do the revised regulations address the key concerns raised during the initial Canada Gazette Part I consultations?
- How can we best ensure that the intent of the proposed regulations is achieved?
- Do the revisions address concerns about unintended inclusion of domestic sales as a sale for export to Canada?
- Do the revisions address concerns about misalignment with the Customs Valuation Agreement?