Duties and Taxes Imposed on Vehicles Imported From the US to Canada

If you own a vehicle eligible for import to Canada, you should know that there are several Clearit.ca car Canadian customs duties rates and taxes that may apply

Import Duty

Import Duty is a 6.1 tax only applicable to non-NAFTA vehicles.  A NAFTA vehicle is one which has been at least 55 percent manufactured or assembled in North America (Canada, the United States, Mexico).  These vehicles are exempt of any tariffs, taxes, or duties when sold/purchased within one of these three [North American] countries.

Goods & Services Tax

When a new or used vehicle is imported into Canada it is subject to a Goods and Services tax of 5 percent.  Anyone one bringing a car across the border must immediately pay this tax to a Canadian Customs Agent.  Essentially it is the same as paying the sales tax on a vehicle purchased from a registered auto dealer in Canada.

Provincial Sales Tax

After the successful import of a vehicle into Canada the owner must pay the provincial sales tax upon registering the vehicle in the country of Canada.  This particular tax is based upon the tax rate within the province of registration at the time of registration. It is generally calculated at the prevailing exchange rate at the immediate hour of vehicle registration.  However, as a practice, many provincial insurance agents tend to use the official Canada Customs receipt for the purpose of calculating provincial taxation.

Air Conditioning Taxx

This is a tax imposed on any vehicle which has air conditioning. The tax is only $100 and is immediately payable upon crossing the border.

Excess Weight Tax

For any vehicle weighing more than 2,007 kg (4,425 lbs), there may be an additional tax.

Gas Guzzler Tax

The Canadian Federal Government began imposing this tax on March 19, 2007 as an excise on vehicles which are not fuel-efficient.  It applies to all new vehicles that have been purchased in Canada—or are imported to Canada—from the United States.  A “fuel-inefficient” vehicle is one considered to have a weighted average fuel consumption rating of at least 13 liters per 100 kilometers, but the tax rate follows:

  • $1,000 for consumption ratings between 13 and 14 litres per 100 kilometers
  • $2,000 for ratings between 14 and 15 litres
  • $3,000 for ratings between 15 and 16 litres
  • $4,000 for ratings in excess of 16 litres.