US Import Tariffs from Canada

USMCA (United States-Mexico-Canada Agreement), which replaced NAFTA on July 1, 2020, provides 0% duty rates for most qualifying Canadian-origin goods imported into the US. To claim USMCA preferential treatment, importers must: (1) ensure the goods meet USMCA rules of origin (typically substantial transformation or tariff shift rules specific to each product category), (2) obtain or prepare a USMCA Certificate of Origin (CBP Form 434 or equivalent importer certification), and (3) declare USMCA preference on CBP entry (Special Program Indicator "S" on Form 7501). Record-keeping requirements: maintain USMCA documentation for 5 years. CBP conducts origin verifications — inadequate documentation results in preferential rate denial and MFN duty assessment.

Canadian softwood lumber (primarily British Columbia, Ontario, Quebec species) is subject to ongoing countervailing duty (CVD) and antidumping (AD) orders that stack on top of the 0% USMCA base rate. As of 2026, combined CVD and AD cash deposit rates for major Canadian producers range from approximately 8% to 24% depending on the specific company and province. These duties are adjusted through annual administrative reviews by Commerce and USITC. Check the current company-specific rates at the Commerce Department's AD/CVD database (enforcement.trade.gov) before importing softwood lumber from Canada.

USMCA automotive rules of origin are the most complex in the agreement. For passenger vehicles to qualify for 0% duty: (1) 75% regional value content (RVC) required — up from 62.5% under NAFTA, (2) 70% of steel and aluminum by weight must be sourced from North America, (3) 40% of labor value content must come from workers earning $16+/hour. Auto parts have product-specific rules ranging from 65%–75% RVC depending on the part category. Vehicles failing to meet USMCA ROO face the 2.5% MFN rate (or 25% for light trucks). Importers should obtain detailed ROO certifications from Canadian manufacturers before each model year.

Canada was exempted from Section 232 steel and aluminum tariffs under a joint US-Canada agreement (effective May 2019) that replaced the initial tariff imposition. Canadian steel and aluminum imports currently enter duty-free under Section 232 — not subject to the standard 25% steel or 10% aluminum surcharges that apply to most other countries. However, this exemption includes safeguard mechanisms: if Canadian steel/aluminum import volumes surge significantly above historical averages, the US can reinstate Section 232 tariffs. Importers should monitor USTR and Commerce Department announcements for any changes to Canada's Section 232 exemption status.

USMCA certification of origin can be on CBP Form 434 or any equivalent document containing the required data elements (importer/exporter/producer information, description of goods, HTS code, origin criteria, blanket period if applicable). Common mistakes: (1) Using old NAFTA certificate forms — these are not valid for USMCA, (2) Failing to update certifications when suppliers change sub-components, (3) Blanket certifications covering the wrong HTS codes, (4) Not retaining supporting records (bills of materials, production records) to substantiate the certification. CBP can require importers to produce supporting documentation within 30 days of a verification request. Failure to respond results in duty liability plus penalties up to 4x the unpaid duty.