Toronto, December 29, 2025
Further to Prime Minister Mark Carney’s recently announced new trade measures for Canada’s steel industries, as reported in our December issue of Route (Universal Logistics’ monthly newsletter), this 25 percent Steel Derivative surtax has been detailed in Canada Border Services Agency (CBSA) Customs Notice 25-33: Steel Derivative Goods Surtax Order.
Effective December 26, 2025, certain steel derivative goods imported into Canada are subject to a surtax in the amount of 25 percent on the full declared value for goods listed in the Schedule to the Steel Derivative Goods Surtax Order. The surtax will apply to steel derivative goods imported into Canada, for commercial purposes, from all countries of origin.
Canada maintains a non-stackable policy for its surtaxes on steel. Only one of these measures can apply to a particular good, following this order of precedence:
- Surtax on steel imports over the established tariff rate quotas for non-CUSMA countries
- Either: a) surtax on U.S. steel products; b) surtax on Chinese steel products; or c) surtax on non-U.S. imports that contain steel melted and poured in China
- Surtax on steel derivative products from all countries
Exceptions to the surtax
The surtax will not apply to steel derivative goods that are in transit to Canada on the date on which the surtax comes into force. This includes goods that were in transit before the surtax comes into force. For the purpose of this Customs Notice, ‘in transit to Canada’ refers to goods bound for but not yet arrived in Canada, and under the control of a carrier. Importers must have proof in their possession that such goods were in transit to Canada in order to demonstrate that the surtax is not applicable. Such proof may include the following documentation: shipping documents (for example, a bill of lading), report of entry documents, and cargo control documents. Such proof may be requested at any time by a CBSA officer.
Steel derivative goods that are subject to a surtax under the China Surtax Order (2024), the United States Surtax Order (Steel and Aluminum 2025), the Order Imposing a Surtax on the Importation of Certain Steel Goods or the Steel Goods and Aluminum Goods Surtax Order are not subject to the surtax.
Casual goods as defined in section 2 of the Persons Authorized to Account for Casual Goods Regulations (SOR/95-418) are not subject to the surtax.
Steel derivative goods that are classified under a tariff item of Chapter 98 of the Schedule to Canada’s Customs Tariff, even if the goods are otherwise classifiable under a tariff item set out in the Schedule to the Steel Derivative Goods Surtax Order, are not subject to the surtax.
Steel derivative goods that are imported before July 1, 2026 for use in the manufacture of motor vehicles or chassis for motor vehicles or in the manufacture of parts of or accessories for motor vehicles or chassis for motor vehicles are not subject to the surtax.
Steel derivative goods that are imported before July 1, 2026 for use in aircraft, ground flying trainers or spacecraft or in parts of aircraft, ground flying trainers or spacecraft are not subject to the surtax.
Utility wind towers, and sections of those towers, that are classified under tariff item 7308.20.00 and are imported for installation in energy projects located west of the Ontario–Manitoba border are not subject to the surtax.
For subject goods imported into Canada and subsequently re-exported Canada’s Duties Relief and Duty Drawback Programs will be available to importers for surtax paid or owed by Canadian businesses, subject to the provisions of the Canada-United States-Mexico Agreement (CUSMA). When goods are of CUSMA (US/Mexico) origin, the goods are not subject to the limitations of CUSMA and the “lesser of two duties” determination does not apply. Therefore, in these circumstances, the goods may be eligible for full relief, if the CUSMA criteria is met, as outlined in CBSA’s Memorandum D7-4-3: CUSMA Requirements for the Duty Drawback and the Duties Relief Programs.
For more information, please call Brian Rowe, Director – Customs Compliance & Regulatory Affairs at (905) 882-4880, ext. 1213.
