Sourcing Journal confuses US apparel exporters
A recent article in Sourcing Journal (and also on Yahoo.com) has contributed to misunderstandings concerning the current tariff situation between Canada and the United States regarding consumer products such as apparel.
The article in question, Canada Cools US Trade Tensions By Drawing Down Retaliatory Duties, cites recent adjustments to some of the surtaxes imposed on US products by the Canadian Government, but misinterprets the scope of such adjustments.
The article suggests that Canada has withdrawn a 25% tariff (the Canadian government refers to these as surtaxes) that applies to US products such as apparel. These surtaxes were put in place in response to US tariffs announced on March 4, 2025.
In simple terms, on March 4, 2025, the US government imposed a 25% tariff on apparel and many other products.
Effective March 7, 2025, this blanket tariff was modified to allow products that meet rules of origin under the CUSMA/USMCA to enter the US duty-free. This provided tariff relief for the vast majority of apparel made in Canada and exported to the United States.
However, Canada did not amend its surtaxes on US products.
The article states:
Under new leadership, Canada has effectively nixed all retaliatory duties on the U.S. in an effort to cool trade tensions that burned red hot just months ago. “Canada has effectively paused its counter tariffs” on the U.S., which stood at 25 percent in March, according to Oxford Economics director of Canada economics Tony Stillo. Had they remained in place, about $60 billion in American-made products like apparel, footwear, motorcycles, cosmetics and alcohol would be subject to the duty rate hike.
This is simply incorrect. These surtaxes remain in place.
The landing page with all tariff response measures is here: Canada’s response to U.S. tariffs - Canada.ca. Relevant Canada Gazette links are in the “related information” section for each measure.
The article seems to refer to two remission orders (linked in the page above), which remit the surtaxes in specific circumstances. These do not apply to US apparel exported to Canada.
Apparel made in the US (whether or not it meets the CUSMA rule of origin is currently subject to a 25% surtax if imported into Canada.
For more information on this, contact Bob Kirke, CAF Executive Director: bkirke@apparel.ca.