eBay Canada’s General Manager released a statement about Canada’s trade deal with the US and Mexico on October 1st, and on Friday, the company notified its sellers in a post on the announcement board.
The new version of the trilateral agreement known as NAFTA has been rebranded USMCA. It’s important for all those buying and selling between the three countries since it impacts how much consumers pay in duties and taxes. The new trade agreement raises “de minimis,” but not when goods are sent to Canada using the postal service
eBay Canada GM Andrea Stairs called the agreement a “failure” for Canadian taxpayers, consumers and small- and medium sized businesses last week, see Tuesday’s EcommerceBytes Blog post here.
eBay Canada October 5th announcement follows:
This week, Canada, Mexico, and the United States announced a new free trade agreement called the United States-Mexico-Canada Agreement (USMCA). Once ratified, this agreement will replace the current North American Free Trade Agreement (NAFTA). When it comes into effect, the agreement will change Canada’s de minimis for certain categories of imports (the de minimis threshold sets the item value above which duties and taxes levied are on goods imported to Canada).
Currently, Canadians can import goods with a value of up to $20 CAD without incurring duties or taxes.
Under the new USMCA, the de minimis threshold for goods coming from the US and Mexico and imported via express carriers will change: Canadians will be able import up to $40 CAD in value without incurring taxes and up to $150 CAD without incurring duties.
It’s important to note that these changes do not apply to postal services (i.e. goods shipped from the US using USPS and delivered in Canada via Canada Post). As a result, the current $20 de minimis threshold will remain in place for goods imported by postal carriers.
The USMCA will need to be ratified by Canada, the US and Mexico before it’s provisions come into effect. This is expected to take some time.
We recommend that you visit the Canada Border Services Agency website for more information about how the Canada Border Services Agency assesses and collects duties and taxes on imported items.
Finally, the terms of the USMCA suggest that the US will lower its de minimis threshold to $100 (from the current level of $800) for Express shipments. eBay is investigating this aspect of the agreement to confirm the countries’ intention.
SOURCE: eBay Canada Announcement Board