The CBSA proposes changes to regulations to protect the competitiveness of Canadian businesses
May 29, 2023 Ottawa, ON
The Canada Border Services Agency (CBSA) is continuously reviewing customs processes, including legislative and regulatory instruments, to protect the competitiveness of Canadian businesses and meet the increasing volume of e-commerce.
As part of its efforts, the CBSA is proposing amendments to the Valuation for Duty Regulations that will strengthen the statutory and regulatory frameworks to help Canadian importers compete on a more level playing field with foreign-based importers and address lost customs revenue to the Government of Canada in duties paid on lower value for duty declarations.
Currently, Canada’s regulatory framework on determining the value for duty of imported goods does not align with international consensus established at the World Customs Organization. This creates an unfair advantage for foreign-based importers as they can declare a lower priced sale in the trade chain to value their goods and pay less duty on imported goods. Creating a definition for “sold for export to Canada” and changing the definition of “purchaser in Canada” would allow us to address this misalignment. The proposed regulatory amendments will provide a consistent and reliable method for calculating the value for duty for all imported goods.
Draft regulations have been published in the Canada Gazette, Part I. Any interested parties, such as importers, businesses, and customs brokers, have until June 26, 2023 to submit written comments on the draft regulations.
Between January 1 and December 31, 2022, the CBSA assessed over $39 billion in duties and taxes (Customs duties, Special Import Measures Act duties, GST and Excise taxes).
From February 2020 to July 2022, retail e-commerce sales increased by 67.9%, and the share of retail e-commerce sales as a proportion of total retail sales, rose from 3.9% in 2019 to 6.2% in 2022, making e-commerce an important platform for business operations.
In Budget 2021, the government proposed changes to the Customs Act to improve duty and tax collection by ensuring that goods are valued in a fair and consistent manner by all importers.
From June 4 to July 4, 2021, the CBSA launched an informal consultation notice on its website regarding these proposed amendments.
Canada Border Services Agency
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