Duty Free Importing
*How to avoid the 18% duty on NAFTA made clothing:
It is a common misconception that all clothing made in the USA can be imported into Canada duty free
The sad truth is that the NAFTA agreement only permits garments that wholly originate in a NAFTA country to pass their borders without duty
If the article of clothing is made from cotton that was grown, milled and woven in the US it qualifies to enter Canada without paying the 18% duty
There are no North American suppliers of polyester or rayon, however, and if there is more than 7% of imported fiber in a garment, it does not qualify
This is called, “The de Minimus Rule” which can be found on Page 15 of this official NAFTA link: http://cbsa-asfc.gc.ca/publications/pub/c-124-eng.pdf
CBSA (Canada Border Services Agency) enforces this rule to the letter and many unwary importers find themselves faced with terrible consequences
CBSA can commence on Audit on any importer at any time. They then demand to see the fabric content of every item imported for the past 5 years
They have and will call for all the back duties to be paid on all articles of clothing that do not qualify (and most do not)
They have and will impose fines and ignorance of the law is not a valid argument
American exporters issue Certificates of Origin willy-nilly for they too are ignorant of the NAFTA rules and there are no consequences for them
The onus is on the importer to be aware of all the rules concerning the items they are declaring at the border so be warned, it’s a minefield
Objects of Desire can guarantee that all duties have been paid on the articles of clothing we sell and we guarantee it in writing
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