Canadian workers, the auto sector, the steel and aluminum industries, and related critical manufacturing supply chains are threatened by unfair competition from Chinese producers, who benefit from China's intentional, state-directed policy of overcapacity and oversupply, as well as its lack of rigorous labour and environmental standards. The federal government has recently implemented a suite of tariffs (also known as surtaxes) on certain Chinese imports to level the playing field and protect Canada's workers and businesses from China's unfair trade policies. These include:
- A 100 per cent surtax on all Chinese-made EVs, effective October 1, 2024;
- A 25 per cent surtax on imports of steel and aluminum products from China, effective October 22, 2024; and,
- Potential surtaxes on critical manufacturing sector products, particularly batteries and battery parts, semiconductors, solar panels, and critical minerals, which the government consulted on from September 10, 2024, to October 10, 2024.
Today, the federal government launched the process for Canadian businesses to request remission of surtaxes on electric vehicles (EVs) and steel and aluminum imported from China. Remission would also be available for potential surtaxes on critical manufacturing sector products. To ensure that Canadian industry has sufficient time to adjust supply chains, remission will provide relief from the payment of surtaxes, or the refund of surtaxes already paid, under specific and exceptional circumstances.
The federal government is offering this relief in recognition of the potential challenges that Canadian industry faces as the result of adjusting supply chains in a timely manner. Remission from applicable surtaxes would be provided in compelling circumstances in line with the rationale behind the application of the surtaxes-leveling the playing field for Canadian workers and businesses. The government is ensuring Canadian workers and businesses are not unduly burdened by surtaxes on imports from China.
Accordingly, the federal government will consider requests for remission of surtaxes to address the following circumstances:
- Situations where goods used as inputs, or substitutes for those goods, cannot be sourced either domestically or reasonably from non-Chinese sources;
- Where there are contractual requirements, existing prior to August 26, 2024, requiring Canadian businesses to purchase Chinese inputs into their products or projects for a specified period of time; and,
- Other exceptional circumstances, on a case-by-case basis, that could have significant adverse impacts on the Canadian economy.
Remission will not be granted for goods intended for resale in the same condition to the United States.
The federal government will consider the appropriate duration of remission, with intent to provide it on a transitional basis only in most cases, as supply chains adjust and may also be applied retroactively to the date of implementation of the surtaxes.
Should the government decide to impose additional surtaxes on other goods, such as critical manufacturing sector products, the remission process would become available for those goods.
