Until Friday, small companies in Canada can no longer send small packages for the United States free of taxes, and some online vendors are worried that their companies do not survive the coup.
The exemption of almost centenary minimis, which in recent years allowed the goods of less than $ 800 the United States to enter the US.
That means that these shipments will now be subject to tasks of up to $ 200 in the United States, depending on the country of origin, and small Canadian businesses with US clients will be beaten with additional costs that are dedicated to their profits.
“We have cut all our shipment to the United States because, at this time, with the amount of risk and lack of information about shipping to the United States, we cannot justify it,” said Jess Sternberg, owner of Free Tag clothes based in Vancouver.
For years, the United States government had expressed concern that minimis shipments were being used to smuggle mortal opioids in the country, because they are not so closely inspected by US customs. First he suspended the exemption of shipments from China earlier this year, a policy change that affected large electronic vendors such as Shein and Temu.
But the end of De Minimis for the rest of the world, including Canada, will affect the stores of mom and pop “disproportionately”, according to John Boscariol, an expert in trade and partner of McCarthy Tetrault in Toronto.
“Many of those who have been based on these low -value shipments to the United States as part of their bread and butter for survival are being affected by this, and may have to get out of the business.”
A history of two Canadian businesses
Canadians can still send emails and gifts of less than $ 100 to the US. To qualify, a product must comply with specific criteria, such as having at least a certain percentage of IT in North America.
However, even in those cases, small and medium enterprises are not totally out of the hook, Boscariol said, pointing out additional administrative costs for customs authorization, such as brokerage rates for companies that have to demonstrate that their shipments meet.
Sternberg is worried about those costs. His business, which specializes in slow inclusive fashion for women, makes their clothes in Canada from a mixture of national and imported materials.
However, their Canadian sales have decreased in the last year, which attributes to economic uncertainty. Meanwhile, its American customer base is growing, which represents almost 45 percent of all sales since the beginning of this year.
“Not only is the growth potential, that is where it is the potential for us, which is important at this time for small businesses, because it has been difficult years,” he said.
With recent changes, there is “definitely a possibility” that the business will not survive in this period, said Sternberg.
“We are going to advance just by focusing on our Canadian clients and our international clients, and we hope that things change and we can send the United States in the future.”
Meanwhile, another small Canadian company says that it will absorb the cost of additional tasks, because an increase in sales of the Buy Canadian movement has given him the margin of maneuver to do so.
“We have made the decision to eat the cost, which is: it is big, huge,” said Jenn Harper, the founder of Cheekbone Beauty Cosmetics, a clean -based cosmetics company with headquarters based in St. Catharines, Ont.
About 30 to 35 percent of its sales are from the United States, according to Harper. But the company saw an increase in Canadian orders at the top of the year in response to commercial climbing and Trump’s annexation threats.
Additional costs amount to an increase of 25 to 30 percent in shipping fees, says Harper, and the company may not be able to keep them absorbing in the long term.
“We are doing this temporarily to see how much our results will really affect,” he said. “But we have made that decision because we do not want to scare any of our US clients.”
‘Double edge sword’
The Minimis program is a “double -edged sword” for small businesses that will be hurt by their loss, according to Bob Kirke, executive director of the Canadian Federation of Apoceis.
“On the one hand, it allowed many smaller companies to increase sales, directly to the consumer, to the United States. Without paperwork, without tasks. It is fantastic,” he said.
“But it is gone. And we stay with many companies that should know better those rules of origin, but they have not had to do it for a few years. And that will be the adjustment.”
The plots worth less than $ 800 were not subject to the duties of the United States under a long -standing commercial policy, known as minimis exemption. But President Donald Trump signed an executive order that states that as of August 29, it would be eliminated, leaving many companies discovering how to navigate the change.
Some shipping companies told CBC News how they will adapt at the end of De Minimis. Fedex is still accepting shipments to the United States, while Canada Post says that it is working with a third to collect and send the tasks of the customs of the United States.
However, Shipping Firm Chit Chats no longer accepts packages to the United States. And Electronic Commerce Commerce and Ebay companies say they will not accept purchases of post -feeding label labels for packages that go to the US.
Kirke acknowledged that some small businesses could go out as the exemption ends. The other challenge, he added, is that Canadian businessmen will not be able to innovate so much without easy access to the US market.
“It will limit part of that innovation, part of that growth, and that is the soul [of the] industry. So that’s the challenge, “he said.
“It has eliminated a really valuable tool for emerging companies.”
