Order Amending the Schedule to the Customs Tariff, 2021–1: SOR/2021-88
Canada Gazette, Part II, Volume 155, Number 10
Registration
SOR/2021-88 April 23, 2021
CUSTOMS TARIFF
P.C. 2021-318 April 23, 2021
His Excellency the Administrator of the Government of Canada in Council, on the recommendation of the Minister of Finance, pursuant to section 82 of the Customs Tariff footnote a, makes the annexed Order Amending the Schedule to the Customs Tariff, 2021 – 1.
Order Amending the Schedule to the Customs Tariff, 2021 – 1
Amendments
1 Tariff item No. 7323.93.00 in the List of Tariff Provisions set out in the schedule to the Customs Tariff footnote a is repealed.
2 The List of Tariff Provisions set out in the schedule to the Act is amended as set out in Part 1 of the schedule to this Order.
3 The List of Tariff Provisions set out in the schedule to the Act is amended by adding, in numerical order, the tariff provisions set out in Part 2 of the schedule to this Order.
Coming into Force
4 This Order comes into force on the day on which it is registered.
SCHEDULE
Part 1
(Section 2)
Amendments to the List of Tariff Provisions
1 The Description of Goods of tariff item No. 8607.19.21 is amended by
- (a) adding a semicolon after the reference to “track brakes”; and
- (b) adding “Forged, for use in the manufacture or production of wheel sets” as a separate provision after the provision referred to in paragraph (a).
Part 2
(Section 3)
| Tariff Item | Description of Goods | Most-Favoured-Nation Tariff | Preferential Tariff | ||
|---|---|---|---|---|---|
| Initial Rate | Final Rate | Initial Rate | Final Rate | ||
| 7323.93 | --Of stainless steel | ||||
| 7323.93.10 | ---Parts for use in the manufacture of cookware | Free | Free (A) | UST: Free | UST: Free (A) |
| MXT: Free | MXT: Free (A) | ||||
| CT: Free | CT: Free (A) | ||||
| CIAT: Free | CIAT: Free (A) | ||||
| CRT: Free | CRT: Free (A) | ||||
| IT: Free | IT: Free (A) | ||||
| NT: Free | NT: Free (A) | ||||
| SLT: Free | SLT: Free (A) | ||||
| JT: Free | JT: Free (A) | ||||
| PT: Free | PT: Free (A) | ||||
| COLT: Free | COLT: Free (A) | ||||
| PAT: Free | PAT: Free (A) | ||||
| HNT: Free | HNT: Free (A) | ||||
| KRT: Free | KRT: Free (A) | ||||
| CEUT: Free | CEUT: Free (A) | ||||
| UAT: Free | UAT: Free (A) | ||||
| CPTPT: Free | CPTPT: Free (A) | ||||
| UKT: Free | UKT: Free (A) | ||||
| GPT: Free | GPT: Free (A) | ||||
| LDCT: Free | LDCT: Free (A) | ||||
| CCCT: Free | CCCT: Free (A) | ||||
| AUT: N/A | AUT: N/A | ||||
| NZT: N/A | NZT: N/A | ||||
| 7323.93.90 | ---Other | 6.5% | 6.5% (A) | UST: Free | UST: Free (A) |
| MXT: Free | MXT: Free (A) | ||||
| CT: Free | CT: Free (A) | ||||
| CIAT: Free | CIAT: Free (A) | ||||
| CRT: Free | CRT: Free (A) | ||||
| IT: Free | IT: Free (A) | ||||
| NT: Free | NT: Free (A) | ||||
| SLT: Free | SLT: Free (A) | ||||
| JT: Free | JT: Free (A) | ||||
| PT: Free | PT: Free (A) | ||||
| COLT: Free | COLT: Free (A) | ||||
| PAT: Free | PAT: Free (A) | ||||
| HNT: Free | HNT: Free (A) | ||||
| KRT: Free | KRT: Free (A) | ||||
| CEUT: Free | CEUT: Free (A) | ||||
| UAT: Free | UAT: Free (A) | ||||
| CPTPT: Free | CPTPT: Free (A) | ||||
| UKT: Free | UKT: Free (A) | ||||
| GPT: 5% | GPT: 5% (A) | ||||
| LDCT: Free | LDCT: Free (A) | ||||
| CCCT: Free | CCCT: Free (A) | ||||
| AUT: N/A | AUT: N/A | ||||
| NZT: N/A | NZT: N/A | ||||
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Order.)
Issues
The Order Amending the Schedule to the Customs Tariff, 2021 – 1 eliminates customs duties on selected goods used in the production of other goods (i.e. manufacturing inputs). Reducing tariffs on manufacturing inputs helps lower production costs for Canadian businesses and enhances their overall competitiveness.
Background
The Government of Canada has a long-standing framework for considering the removal of tariffs on goods used in the production of other goods in order to augment the competitiveness of Canadian manufacturers. Such relief is provided pursuant to section 82 of the Customs Tariff. This section provides authority to amend the Schedule to the Customs Tariff to give tariff relief for “goods used in the production of other goods.”
This Order responds to requests from companies seeking tariff relief to lower their costs and enhance their competitiveness, at home and abroad. The Department of Finance conducted a due diligence process and consulted with stakeholders to assess impacts on domestic production capacity, including domestic sources of alternative inputs to the imported goods; to ensure that the amendments abide by the intent of section 82 of the Customs Tariff; and to ensure that tariff relief would not unduly affect other companies.
The Order reduces to “Free” the most-favoured-nation (MFN) rate of customs duty for the products listed in the Order. The Order also consequentially eliminates any other tariff on these goods that is not at a rate of “Free.” This ensures that preferential tariffs are not higher than the MFN tariff, consistent with section 25 of the Customs Tariff.
Objective
The objective of this Order is to reduce tariffs on manufacturing inputs to help Canadian manufacturers.
Description
As a result of industry-specific requests for tariff relief, the Order eliminates customs duties on the following products used in manufacturing in Canada:
- Stainless steel parts for use in the manufacture of cookware: tariff item No. 7323.93.10
- Forged wheels for use in the manufacture or production of wheel sets: tariff item No. 8607.19.21
Regulatory development
Consultation
Consultations were undertaken with importers and producers of the products included in this Order. All stakeholder views have been considered in the development of this Order.
As a result of consultations on the proposed changes for forged wheels for use in the manufacture or production of wheel sets, it was determined that the products for which tariff relief is being provided will not directly compete with products manufactured in Canada.
No stakeholder submissions were received with respect to stainless steel parts used in the manufacture of cookware, for which there is no production available in Canada.
This Order is relieving in nature for companies that currently import these products. As targeted consultations were undertaken with all interested parties, there is no added value in prepublishing this Order, as it is not expected to have any impact on the general public. All Canadian importers of these products will benefit from the duty reduction.
Modern treaty obligations and Indigenous engagement and consultation
The Order is not expected to have any differential impacts on Indigenous people as it will only impact a small number of companies and is not expected to alter their operations in any significant way.
Instrument choice
The Order provides tariff relief through section 82 of the Customs Tariff, which provides authority to amend the Schedule to the Customs Tariff. An Order in Council represents the most efficient instrument for achieving this objective.
Regulatory analysis
Benefits and costs
The full welfare impacts of the removal of the duties have not been estimated. However, the estimated annual duties foregone by the Government would be approximately $1.2 million. These duties foregone represent corresponding savings for Canadian industry on manufacturing inputs used in the production processes, therefore lowering their costs and enhancing competitiveness in both domestic and international markets.
Small business lens
The small business lens does not apply to this Order, as there are no costs imposed on small businesses.
One-for-one rule
The one-for-one rule does not apply to this Order, as there is no change in administrative costs to businesses.
Regulatory cooperation and alignment
The Order is related to domestic law and, given its relieving nature, does not raise any issues of inconsistency with international trade or regulatory agreements.
Strategic environmental assessment
In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.
Gender-based analysis plus
No gender-based analysis plus (GBA+) impacts have been identified for this Order.
Rationale
The tariff elimination in this Order is consistent with the Government's long-standing policy of providing tariff relief to support manufacturing competitiveness. It also follows broad-based measures announced in the 2009 and 2010 federal budgets to eliminate tariffs on manufacturing inputs as well as machinery and equipment in order to assist Canada's manufacturers.
Implementation, compliance and enforcement, and service standards
The Canada Border Services Agency (CBSA) is responsible for the administration of, and compliance with, customs and tariff legislation and regulations. In the course of its administration of these tariff amendments, the CBSA will inform the importing community. The tariff amendments will come into force on the date of registration.
Contact
Yannick Mondy
International Trade Policy Division
Department of Finance Canada
Ottawa, Ontario
K1A 0G5
Email: fin.tariff-tarif.fin@canada.ca