How customs rebates protect Canada’s vehicle industry
The drawback schemes are expected to soften the blow of US steel tariffs
Toronto — Canadian government customs provisions are expected to soften the blow on the country’s automotive industry from retaliatory tariffs on US steel, according to trade lawyers and industry leaders bracing for higher costs. Decades-old programmes reduce or refund import duties on supplies like steel when companies in Canada can show the material is used in export products. They could protect the motor vehicle industry’s supply contracts covering raw materials and parts, which often cross borders several times before a vehicle is finished. While imposing tariffs against a long list of US products in July, Canada clarified that "duties relief" and "duty drawback" programmes would be available to Canadian exporters. "That provision in the notice is overwhelmingly directed at the auto industry," said Jesse Goldman, a trade lawyer at Borden Ladner Gervais. Without drawbacks, Goldman said, the Canadian retaliation would have "very significantly and very quickly" hurt the industry.