This article is probably of no use to consumers — unless, of course, you enjoy giving yourself a headache.

But if you’re a business paying Canadian tariffs… no, wait, customs duties… no, wait, surtaxes… then this might just be worth your while. Why? Because knowing what you are paying — and whether you can minimize its impact — could save you real money.

Tariffs vs. Customs Duties: What’s the Difference?

You’ve likely heard it everywhere: Canada has imposed a tariff on U.S. goods.

But here’s the truth: Canada doesn’t actually impose “tariffs” the way people commonly use the term. Under Canadian law, Canada imposes customs duties, not tariffs, per se.

Customs duties are amounts imposed on imported goods based on their value, classification, and origin. They are determined under the Customs Tariff Act, and structured around international agreements like CUSMA.

The duty is the price of admission that goods must pay to cross our border — a standard mechanism of regulating trade, protecting industries, and, yes, raising government revenue.

The Customs Tariff Act contains a “List of Tariff Provisions” — essentially a vast pricing sheet — but ironically, you’re paying a customs duty, not a tariff.

In short: tariffs describe the list, but customs duties describe the charge. But buyer beware: even the Act appears itself to sometimes use “tariff” and “customs duty” interchangeably — which doesn’t exactly help untangle the web.

Customs Duties vs. Surtaxes: Why It Matters

If you’ve managed to follow these mental gymnastics so far, you might conclude that when Canada retaliated against the U.S. in March 2025, it announced new customs duties.

Logical, right? Wrong again_ the March 5, 2025 announcement referred to “customs duties, applied as surtaxes.”

In reality, under the Customs Tariff Act, Canada can apply not just customs duties, but also surtaxes. A surtax is an additional, non-standard duty imposed typically in retaliation against unfair practices — like the Canada U.S. tariffs of 2025 responding to American measures against Canadian industries.

Canada’s surtaxes are not your garden-variety customs duties, but instead a targeted political hammer, fast-tracked through an Order in Council without having to bother Parliament.

Why Did the Government Choose Surtaxes Over Customs Duties?

Simple: Speed and flexibility.They can be deployed immediately via cabinet authority — a much faster, politically nimble tool in cross-border trade skirmishes.

So, when Ottawa needed to hit back hard and fast in cross-border trade policy with the United States, surtaxes were the weapon of choice.

Why Should Businesses Care?

If you are thrilled to pay the surtaxes without question, you can safely stop reading.

But if you — like most businesses — are interested in minimizing costs, a little legal literacy goes a long way.

First, under Canada’s tax law, you may be entitled to claim Canadian tax deductions for these surtaxes.

Second, there’s the possibility of seeking a remission order — essentially asking the government nicely (with paperwork, of course) to refund the surtax under certain hardship or unfairness grounds.

Conclusion

Canadian businesses navigating the shifting sands of international trade law, understand that nuances isn’t just academic — they’re essential.

Over the next few days, we’ll break this topic down even further:

• One article on whether and when tax deductions are possible for these surtaxes, and
• Another article on how and when to apply for a remission order.

Stay tuned — and as always, if you need help turning headaches into strategy, you should check in with our business, trade, and tax  lawyers at Coudert Legal.

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Coudert Media
April 28, 2025