# Why do we pay import/export duties/customs if we live in a free trade zone?



## hypo (Aug 11, 2010)

One thing that the increased value of the dollar has done over the years is allowed me to be a lot more willing to buy goods online from US stores. What drives me nuts however is having to pay duty fees sometimes before the items are fully mine. 

I'm just wondering why we have to pay these fees if we're supposed to be living under NAFTA? Isn't the definition of a free trade zone mean that there are no import/export duties to allow trade and commerce to flourish?


----------



## plen (Nov 18, 2010)

As far as I know the item has to be manufactured in the US or Mexico for it to be duty free. If the seller imported it then you're subject to duties. Then the duty can vary a ton depending on the item.

If the duties aren't more than $1.00 then they won't bother collecting either.


----------



## Square Root (Jan 30, 2010)

This has bothered me as well. Not sure why it is his way?


----------



## GeniusBoy27 (Jun 11, 2010)

It depends on the manufacturer's origin (not where you bought it).


----------



## Square Root (Jan 30, 2010)

GeniusBoy27 said:


> It depends on the manufacturer's origin (not where you bought it).


OK but if it's made in China and imported into the US where I buy it, shouldn't any duty already be paid in US? Why do I have to pay it again?


----------



## the-royal-mail (Dec 11, 2009)

I am not sure if the OP is considering the tax + $5 Canada Post bogus fee for collecting the taxes as "duty" in his post. OP, more details about what you are referring to?

Assuming you are referring to the sales tax they charge as mentioned, they may not call it "duty" anymore, but if walks like a duck and looks like a duck...


----------



## GeniusBoy27 (Jun 11, 2010)

Square Root said:


> OK but if it's made in China and imported into the US where I buy it, shouldn't any duty already be paid in US? Why do I have to pay it again?


Simple. US duty does not equal Canadian duty for manufactured products in China.


----------



## Square Root (Jan 30, 2010)

GeniusBoy27 said:


> Simple. US duty does not equal Canadian duty for manufactured products in China.


So you are thinking we just pay the difference? What if it is less into Canada? Do we get a refund?


----------



## MoneyGal (Apr 24, 2009)

The free trade agreement is about shoring up relationships between North Americans as trading partners by removing barriers *within North America* to trade in goods *manufactured in one of the three countries.*

Duties paid by one of the trading partners on goods imported from outside NA are not in any way integrated into NAFTA. There's no capacity to refund, discount, integrate, or in any way take duties paid in one country on goods exported into one of the NAFTA signatories from outside NAFTA and then re-imported into another NAFTA country - goods from non-participating countries are explicitly excluded from NAFTA. 

The fact that duties may be paid in the U.S. on goods imported from China into the U.S. and then re-imported by a Canadian into Canada -- this is exactly how NAFTA was designed to work. Duties and tariffs on non-NAFTA-produced goods are levied in order to make those goods less economically attractive to NAFTA citizens. This is NAFTA in action, not a failure of NAFTA.


----------



## Square Root (Jan 30, 2010)

That's useful Money Gal,thanks. So when I come back to Canada and declare over the exemption(yah right) the customs guys let everything made in the US in for free? Would have to pay HST though, I guess.


----------



## MoneyGal (Apr 24, 2009)

There are still duties and tariffs on certain categories of product. Women's clothing, for example, is subject to an 18% duty when imported from the U.S. into Canada. Kids' clothing, in contrast, is exempt. I have a link to the complete rates somewhere if you are really interested.


----------



## Square Root (Jan 30, 2010)

No that's great. Thanks.


----------



## twa2w (Mar 5, 2016)

MoneyGal said:


> There are still duties and tariffs on certain categories of product. Women's clothing, for example, is subject to an 18% duty when imported from the U.S. into Canada. Kids' clothing, in contrast, is exempt. I have a link to the complete rates somewhere if you are really interested.


I thought that duty depended on the material the clothing was made from.
A few years ago my spouse did some serious shopping in the US. When she declared the items, they wanted to know the material and they charged her duty on 3 items only.


----------



## MrMatt (Dec 21, 2011)

twa2w said:


> I thought that duty depended on the material the clothing was made from.
> A few years ago my spouse did some serious shopping in the US. When she declared the items, they wanted to know the material and they charged her duty on 3 items only.


It's dependent on the tariff code, which are a global standard (yah)
Now the actual rate is obviously the choice of the government, and the interpretation gets interesting.


https://www.cbsa-asfc.gc.ca/trade-commerce/tariff-tarif/2017/menu-eng.html


----------



## Pop Alexandra (May 8, 2018)

Thanks for sharing, MrMatt. I guess it's a necessary evil in the end. 
Let's just hope the taxes don't go even higher.


----------

