Relief (potentially) in sight – The availability of remission under the Canadian retaliatory tariff regime (Part I)
Government has implemented some processes which they hope will provide Canadian businesses and importers with some much-needed relief.
Update: An earlier version of this article was published before an updated Customs Notice from the Canada Border Services Agency (CBSA) was released May 20, 2025. As has been the case the last few months, the landscape under which importers operate is constantly changing, and below is our updated commentary on this topic.
Background
To date, Canada’s “retaliatory” tariffs against the United States have been implemented via a series of Orders in Council issued by the Department of Finance Canada, beginning on March 3, 2025, with United States Surtax Order (2025-1).[1]
Additional Orders in Council were issued to address tariffs on U.S. steel and aluminum, and U.S. vehicles: United States Surtax Order (Steel and Aluminum 2025) on March 12, 2025,[2] and United States Surtax Order (Motor Vehicles 2025) on April 7, 2025.[3]
Recently, the Department of Finance Canada laid out the groundwork for possible relief from these tariffs via two distinct methods.
The first method provides for industry-specific relief via Orders in Council (detailed below). The second method is a more general framework governing submissions for relief. Both methods are being implemented via the “remission” process set out under s. 115 of the Customs Tariff.[4]
The remission process has existed since the current version of the Customs Tariff was enacted in 1997. The process allows the Governor in Council, on recommendation from the Minister of Finance, to remit and/or refund tariffs, in whole or in part, paid on goods imported to Canada. Since the Minister has substantial discretion on whether to recommend remission, the criteria for when remission will be recommended, and subsequently granted, is not well defined.
Factors previously considered by the Minister of Finance have included (i) whether similar remission claims have been submitted in the past, and what the outcome was; and (ii) the nature of the goods in question and the market of the goods, including competitive or comparator goods.[5]
Industry-specific remission
In addition to the processes for remission for importers of vehicles,[6] United States Surtax Remission Order (2025)[7] provides for remission of tariffs for certain goods including:
- Goods imported by or on behalf of various government or emergency organizations such as government or clinical health research organizations, firefighting and law enforcement organizations, the Department of National Defence, the Canadian Forces, and others;
- Goods imported for use in the provision of medically necessary health care services, including services provided at hospitals, health care or dental clinics, long-term care facilities, and others; and
- Goods imported for use, in Canada, in the manufacture or processing of any good, or the packaging of a food product or beverage.
At this time, the Order applies to goods imported into Canada before October 16, 2025. The Order sets out the specific processes for importers to apply for remission under the above categories.
A follow-up Customs Notice clarified the eligibility of certain goods for remission under the Order:
- Goods eligible for remission for “health care purposes” include those imported for use in the provision of medically necessary human health care services;
- Goods used in primary material production (i.e. extraction of mineral ores) or for construction are not eligible for remission; and
- Only goods imported for the packaging of a food product or beverage for human consumption are eligible for remission, and only the empty packaging is eligible (i.e. food products in eligible packaging cannot be imported as one good and qualify for remission).
The Customs Notice confirms that importers can only claim remission on eligible goods, and the Order is not intended to be a catch-all for all importations by importers in the above-noted industries.
Key Takeaway: Though relief from tariffs is available to Canadian importers, it is not intended to be a catch-all, and eligibility for remission will depend on the industry and nature of the goods.
In Parts II and III of this series, we outline the remission process and canvas decisions by the Federal Court in order to provide guidance to eligible importers on what some of the terminology used by the Department of Finance might mean.
This client update is provided for general information only and does not constitute legal advice. If you have any questions about the above, please contact the author.
Click here to subscribe to Stewart McKelvey Thought Leadership.
[1] United States Surtax Order (2025-1). Note that the original United States Surtax Order (2025) was implemented February 1, 2025, but was repealed two days later by Order Repealing the United States Surtax Order (2025) when the U.S. announced a 30-day pause on their tariffs of Canadian goods.
[2] United States Surtax Order (Steel and Aluminum 2025).
[3] United States Surtax Order (Motor Vehicles 2025).
[4] Customs Tariff, SC 1997, c. 36, s. 115.
[5] Transport Desgagnés inc. c. Canada (Procureur général), 2015 FC 1330
[6] See United States Surtax Remission Order (Motor Vehicles 2025), where remission is granted to certain importers for vehicles imported between April 9, 2025, and April 8, 2026. Each affected importer was granted a quota for the number of vehicles for which they could seek remission.