Canada Taxes Your US Inventory on September 8. If You Sell on Amazon.ca, You Have Eleven Days.

US and Canada trade talks collapsed on the night of August 21. The US imposed a 50 percent tariff on $27.6 billion of Canadian goods effective August 22. On August 25, Canada’s Department of Finance published its answer: a matching list covering $27.6 billion of US imports, at 15, 25 and 50 percent, effective 12:01 a.m. on September 8, 2026.

The recommendation: if any part of your Canadian revenue is fulfilled from US inventory, pull your Amazon.ca and Walmart.ca SKU list this week, classify it against the published tariff items, and decide by Friday September 4 which SKUs you reprice, which you pause, and which you shift to Canadian-side inventory. Note the timing. September 7 is the Labour Day holiday on both sides of the border, so your last working day before this lands is Friday the 4th. That is six business days from today. Six days is not enough time to change a supply chain. It is enough time to stop selling unprofitable units.

What the list actually says

Straight from the Finance Canada release, so you are working from the primary document and not a summary of a summary.

Rates are assigned per tariff item, not per sector, and they mirror the US rate on the same goods. Canada’s stated framing is that it “will match the U.S. Section 338 tariffs, dollar for dollar.” So a category is not uniformly 25 or 50. Cheese comes in at 25 while milk powder is at 50. Sawn softwood lumber is 25 while plywood is 50. Carpets are 25 except tufted carpet of other man-made fibres, which is 50. You cannot reason about this at the category level. You have to look up the tariff item.

The categories that matter most to marketplace sellers, and where they landed:

• Apparel, knit and woven (HS 61 and 62): 50 percent. Cotton T-shirts, sweaters and cardigans, synthetic dresses and trousers, coats and anoraks, wool suits, track suits, ski suits, swimwear, protective garments.
• Cosmetics and fragrance (HS 33): 50 percent. Perfume and toilet water, lip and eye make-up, manicure and pedicure preparations, hair preparations.
• Household plastics (HS 3924): 50 percent. Plastic tableware and kitchenware, and the “other household articles” catch-all.
• Paper and packaging (HS 48): mixed. Toilet paper, facial tissue and paper towels at 25. Corrugated cartons, paper sacks, notebooks, binders, paper plates and cups at 50.
• Carpets and rugs (HS 57): 25 percent, with a 50 percent carve-out noted above.
• Steel and steel products (HS 72 and 73): 50 percent across the board.
• Plywood, LVL and blockboard (HS 4412): 50 percent. Drywall panels and glass containers also at 50.

Finance Canada also names appliances, electronics and agricultural equipment as targeted sectors. If you sell anything in those categories, look up your specific tariff items against the published schedule rather than assuming.

Two more provisions worth knowing. Origin is determined by whether the good is eligible to be marked as a good of the US under the CUSMA marking regulations, so this is a US-origin test, not a ship-from test. And goods already in transit to Canada when the measures come into force are not covered.

Why this hits Amazon.ca sellers who never thought of themselves as importers

Plenty of US sellers treat Canada as a bolt-on. You enable Remote Fulfillment with FBA, or you list on Amazon.ca and Walmart.ca and ship from a US 3PL, and Canadian orders arrive as incremental revenue with no separate operation behind them. That structure works because the Canadian customer is the importer of record and the duty is collected at checkout as an import fees deposit rather than showing up in your cost of goods.

That is exactly why this is easy to miss. The tariff does not land in your P&L as a cost line. It lands in your Canadian buyer’s checkout total.

On a $40 US-origin cotton T-shirt at a 50 percent rate, the customer sees a number that no longer competes with the Canadian-stocked offer next to it. Your ACOS looks the same. Your unit economics look the same. Your conversion rate on Amazon.ca falls off a cliff and you spend three weeks looking for the cause in your listing quality score.

The sellers who get hurt worst here are the ones with the cleanest US operation, because nothing in their reporting will flag it.

The three open questions, and how to handle them

Does the surtax apply to low-value courier shipments? The release defers all administration detail to CBSA Customs Notices, which had not published at the time of writing. Do not assume the CUSMA de minimis thresholds shelter you. Check the CBSA notice before September 8 and, if it is silent, price as though the surtax applies.

How will Amazon’s import fees deposit reflect this? Amazon calculates the deposit from its own duty tables. Whether those update on September 8, on September 20, or after a support ticket is not something you control. Watch a few live Amazon.ca detail pages for your own US-origin SKUs during the first week of September and note the delivered price a Canadian buyer actually sees.

Is Amazon moving its own sourcing? Business Insider reported on internal Amazon planning documents indicating the company shifted part of its Canadian direct-import sourcing from the US to China to reduce tariff exposure, while still forecasting Canadian package volume growth of more than 40 percent through 2029. Treat that as reported rather than confirmed. The signal, if accurate, is not subtle: Amazon’s own retail arm is re-routing around US origin while betting on Canadian demand.

What to do before September 4

Isolate Canada in your P&L. Most sellers cannot answer “what did Canada contribute last quarter” without an export and a pivot table, which is the first problem. You need a clean Canadian revenue and margin number before you can make a decision about it.

Then build the SKU list. Every ASIN and item ID you sell into Canada, with country of origin and HS code. If your top Canadian sellers are apparel, beauty, home goods, or anything with a steel component, you are in the 50 percent tier and this is a repricing exercise, not a monitoring exercise.

Then make three calls per SKU. Reprice and hold share where the category is 25 percent and your margin can carry it. Pause where the delivered price after a 50 percent surtax puts you materially above the Canadian-stocked competition, because paying Amazon ads to drive traffic to an uncompetitive delivered price is the fastest way to burn Q4 budget. Shift where the volume justifies it, which means Canadian FBA inventory, a Canadian 3PL, or non-US-origin stock routed directly to Canada, none of which you will stand up before September 8 but all of which you should be scoping now if Canada is more than a rounding error.

One structural note. This is a US-origin test. If your goods are manufactured outside the US and merely warehoused in the US before shipping to Canada, they should not be caught by the surtax, but the entry has to show it. That is a documentation and classification exercise, and it is worth doing properly before a CBSA officer does it for you.

The Q4 context

This does not arrive alone. It stacks on Amazon’s peak fulfillment surcharge running October 15 through January 14, on softer US retail demand, and on Walmart using its tariff refund to fund lower prices going into the holidays. Canadian cross-border margin was already the thinnest part of most US sellers’ books. A 50 percent surtax on apparel and beauty, eleven days before the Q4 build, removes the question of whether it is worth defending on some of those SKUs.

The right posture is not to abandon Canada. Canadian ecommerce demand is growing and the sellers who hold shelf position through a trade disruption own it on the other side. The wrong posture is to leave the Canadian offers running unchanged, discover the conversion problem in mid-October, and spend peak season fixing a pricing decision you could have made in August.

If you want your Canadian SKU list classified against the September 8 schedule, your delivered-price exposure quantified per ASIN, and a reprice-or-pause decision on each one before the Q4 build, book a strategy assessment and we will work through it this week.