$500 idea · Pattern-breaking · Canada · Edition 004
Ottawa projects refunding 77.9% of the auto surtax and 28.8% of everyone else’s.
The Department of Finance briefing binder for the Standing Committee on Finance, 5 February 2026, carries the Budget 2025 projection table for the counter-tariffs. For 2025–26 it projects revenues of $8,722 million and “Remission and other duties relief” of $4,697 million. More than half the money collected is projected to go straight back out. That is not an exception to the programme. It is the larger half of it.
Starting capital this week is CAD $711.30 (USD $500 at 1.4226, Bank of Canada daily average, 6 October 2026) and the target is CAD $7,113.00 a month (USD $5,000), which is CAD $85,356.00 a year. Almost none of that capital is needed. A CBSA import–export account costs nothing, the remission claim has no filing fee, and the only priced item on the whole ladder is a $200 federal incorporation you can skip.
The reason the two numbers differ is published, and it is not subtlety. The automakers’ relief runs through a bespoke order, SI/2026-13, in which a named schedule allocates a duty-free quantity to each eligible manufacturer against commitments to keep producing in Canada — and the Gazette states that “the eligible manufacturers and the quantity of duty-free imports allocated to each manufacturer have been withheld from publication.” A closed list, administered, quota‑capped, 77.9% recovered.
Everyone else’s relief runs through section 3 of the United States Surtax Remission Order (2025), which remits surtax on any good “imported for use, in Canada, in the manufacture or processing of any good” — later widened to agricultural production and food and beverage packaging. No schedule. No business number. No quota. No cap. And, for goods caught by the new United States Surtax Order (2026), no “imported before” cut-off date in section 5 at all. The only clock is paragraph 5(c): a claim “within two years after the date of importation.” 28.8% recovered.
Who is on the other side of the trade: the Receiver General, holding a residue of $4,025 million for 2025–26 that the government’s own small business lens says costs nothing to claim, because “all eligible importers already possess the original customs forms required to justify remission.” The surtax is a 15, 25 or 50 per cent levy on US-origin goods under SOR/2026-186, retaliating against a 50% US measure on $27.6 billion of Canadian exports. For an importer who files, it is zero. For an importer who does not, it is the published rate, and it becomes permanent two years after the container lands.
The evidence
8 findingsThe government’s own projection: more goes back than stays
Table “Combined net revenues from the counter-tariffs are projected in Budget 2025”, in millions of dollars, 2025–2026 column: Revenues −8,722, Remission and other duties relief 4,697. By order: United States Surtax Order 2025 revenue 2,300 against remission 662; Steel and Aluminum 2025 revenue 3,200 against 1,524; Motor Vehicles 2025 revenue 3,222 against 2,511.
The accompanying text: “As of October 17, 2025, the government assessed more than $3.7 billion revenue, net of remissions and other relief programs, from Canada’s counter-tariffs on U.S. goods”, and “For the 2024-25 to 2026-27 fiscal years, combined net revenues from the counter-tariffs are projected in Budget 2025 to amount to approximately $4.4 billion”. Briefing binder, Bill C-15
The 77.9% version is a secret list with a quota on it
The Gazette publishes the order and withholds its operative schedule: “To protect confidential business information with competitiveness implications, the eligible manufacturers and the quantity of duty-free imports allocated to each manufacturer have been withheld from publication.” Remission runs to the quantity set against each importer’s business number, for vehicles “imported on or after April 9, 2026 and not later than April 8, 2027”.
It is also conditional on behaviour, not just on paperwork: an importer that “has reduced or paused its manufacturing of motor vehicles in Canada because of factory retooling” must restart “in accordance with the requirements established by the Minister and the Minister of Industry”. The claim deadline is the same as everyone else’s — “within two years after the date of importation”. Departmental contact: Mike Mosier, Senior Director, Trade and Tariff Policy, International Trade Policy Division, Department of Finance. SI/2026-13
The 28.8% version is one sentence and it is open to everybody
Section 3 grants remission of surtaxes on goods “imported for use, in Canada, in the manufacture or processing of any good”, a class since widened by amendment to cover “the production of any agricultural product” and “the packaging of a food product or beverage”. There is no schedule, no allocation, no business-number list, no quantity cap and no application to be approved for. The test is what the goods are used for.
A Canadian bakery importing US flour, a machine shop importing US bar stock, a cosmetics filler importing US emulsion, a grower importing US irrigation fittings — all inside section 3. Departmental contact on the original order: Scott Winter, Senior Director, Trade Rules, Department of Finance. SOR/2025-122
Read section 5 and the only clock on the 2026 surtax is two years
Section 5’s cut-off dates are written per order and per schedule: “(a.01) in the case of a good that is referred to in Schedule 1 or 1.1 to the United States Surtax Order (Steel and Aluminum 2025) and in respect of which remission is granted under section 3, it is imported into Canada before July 1, 2027”, and “(a.02)” the same for Schedule 2 or 2.1, before February 1, 2026. Section 1 and 2 goods: before July 1, 2027.
No paragraph of section 5 sets an “imported before” date for goods caught by the United States Surtax Order (2026) and remitted under section 3. What binds every claim is “(b) no other claim for relief of the surtax has been granted under the Customs Tariff in respect of the good” and “(c) the importer makes a claim for remission to the Minister of Public Safety and Emergency Preparedness within two years after the date of importation”. SOR/2025-122 consolidated · SOR/2026-154
What the levy actually is, and what it is answering
Made under subsection 53(2), paragraph 79(a) and section 115 of the Customs Tariff. Schedule 1 applies 15% to industrial equipment and components, Schedule 2 25% to dairy, wood, paper, textiles, furniture, kitchenware and appliances, Schedule 3 50% to milk products, molasses, confectionery, cosmetics, apparel, electronics and sporting goods. Goods in transit on 8 September 2026 are out, as are goods under Import for Re-Export Program permits.
The Regulatory Impact Analysis Statement puts it against a US measure of 50% on $27.6 billion of Canadian goods effective 22 August 2026, answered with $27.6 billion of Canadian imports. The RIAS also says plainly that extending the remission order “broadens the range of products for which Canadian importers can claim remission of surtaxes paid”. SOR/2026-186
Ottawa has written down that the claim costs nothing to make
“Analysis under the small business lens concluded that the Order Amending the United States Surtax Remission Order (2025) will impact small businesses. Some of the importers meet the definition of ‘small business’ in the Policy, and the process to claim remission of duties paid meets the definition of ‘administrative burden’ set out in the Policy. No additional flexibility is necessary for small businesses claiming remission, as all eligible importers already possess the original customs forms required to justify remission and will benefit from the remitted funds.”
That is the whole case for this edition, written by the department that wrote the surtax. The documents a claim needs are the ones the importer already has in a drawer. The projected recovery rate on that class of claim is 28.8%. RIAS, SOR/2026-186
The trap: the ordinary customs clock is four years, this one is two
Section 74 lets a person who paid duties apply for a refund where duties were “miscalculated or overpaid”, and paragraph 74(3)(b) gives “four years after the goods were accounted for” to do it. Importers, brokers and their advisers work to that four-year habit, and a surtax looks like a duty.
Remission is not a refund under section 74. It is a remission under Customs Tariff s. 115, and paragraph 5(c) of the order gives two years, not four. Every month that passes retires a month of claims permanently. The first US counter-tariff order took effect 4 March 2025, so the earliest claimable imports fall out of reach on 4 March 2027 — 148 days from today. Customs Act s. 74
$426,780 recovered, and three ways to get there
Capital: 500 × 1.4226 = CAD $711.30. Target: 5,000 × 1.4226 = CAD $7,113.00 a month, or × 12 = CAD $85,356.00 a year. At a 20% contingency rate the surtax you must get back for clients is 85,356 ÷ 0.20 = $426,780.00 a year. Divided by each schedule’s rate, that is the annual US-origin import volume you need under management: ÷ 0.15 = $2,845,200, ÷ 0.25 = $1,707,120, ÷ 0.50 = $853,560. These are the three plotted crossings. The 20% rate is an assumption, not a source.
Projected remission rates from the Budget 2025 table: 2,511 ÷ 3,222 = 77.9% (Motor Vehicles), 1,524 ÷ 3,200 = 47.6% (Steel and Aluminum), 662 ÷ 2,300 = 28.8% (general order), 4,697 ÷ 8,722 = 53.9% overall. Unremitted residue for 2025–26: 8,722 − 4,697 = $4,025 million. Had the general order been remitted at the motor-vehicle rate, 2,300 × 0.779 = $1,792.5M against the projected $662M — a gap of $1,130.5 million in one fiscal year. Capital after a $200 federal incorporation: 711.30 − 200.00 = $511.30. Bank of Canada FXUSDCAD · Corporations Canada, $200 online
The ladder
From $500 to $5,000 a month · C$713 → C$7,127SOR/2026-186 lists its goods by tariff item across Schedules 1, 2 and 3 at 15, 25 and 50 per cent. Your prospect list is not “Canadian manufacturers”. It is the Schedule 3 tariff items — cosmetics, apparel, electronics, confectionery — because a 50% line turns a mid-size importer into a client who clears your whole year on their own.
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Pull the three schedules and sort them by rate, not by product
SOR/2026-186 lists its goods by tariff item across Schedules 1, 2 and 3 at 15, 25 and 50 per cent. Your prospect list is not “Canadian manufacturers”. It is the Schedule 3 tariff items — cosmetics, apparel, electronics, confectionery — because a 50% line turns a mid-size importer into a client who clears your whole year on their own.
426,780 ÷ 0.50 = $853,560 of imports -
Register the import–export account and the CARM portal, both free
An RM import–export account on a business number costs nothing, and the CBSA portal account that lets you see a client’s accounting declarations costs nothing. Federal incorporation is $200 online at Corporations Canada and is the only priced step on this ladder. It leaves $511.30, which is more float than this work needs, because remission claims carry no filing fee.
711.30 − 200.00 = $511.30 -
Work the oldest imports first, because they are the ones expiring
Paragraph 5(c) gives two years from the date of importation, not from the assessment, not from the year end. Imports from the first counter-tariff order of 4 March 2025 go unclaimable on 4 March 2027. Sort every prospect’s entries oldest-first and claim backwards. The newest entries will still be there next quarter. The 2025 ones will not.
148 days to 4 March 2027 -
Prove use, not identity — that is the whole evidentiary job
Section 3 turns on the goods being “imported for use, in Canada, in the manufacture or processing of any good”. Nothing turns on the importer’s size, sector or status. So the file you build is a use file: bill of materials, production records, the finished good the input went into. The RIAS says the importer already holds the customs forms. What they do not hold, filed and tied together, is the proof of use.
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Check paragraph 5(b) before you promise anybody anything
“No other claim for relief of the surtax has been granted under the Customs Tariff in respect of the good.” A client already running duties relief, a drawback, or sitting inside a bespoke order has nothing for you on those entries, and a claim filed over the top of existing relief is the fastest way to lose a file. Clear the relief history first, then quote.
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Price on contingency, and expect the first engagement to be retroactive
You are recovering money already paid, so there is nothing to sell on faith. The first file on any client covers up to two years of entries at once, which is why one mid-size Schedule 3 importer can fund the whole year in a single claim. Twenty per cent is an assumption and nobody publishes a rate; whatever you set, the volume you need moves inversely with it.
85,356 ÷ 0.20 = $426,780 recovered -
Then say the quiet part to every prospect: the automakers got a schedule
SI/2026-13 allocates a duty-free quantity per manufacturer and withholds the list from publication. Your prospect’s relief is written in the open, is uncapped, and for 2026 surtax goods has no import cut-off date at all. The only thing standing between them and it is a filing that the Department of Finance has recorded, in the Canada Gazette, as requiring no documents they do not already have.
77.9% vs 28.8% recovered
Sources
9 primary documents- Department of Finance briefing binder, Standing Committee on Finance, Bill C-15 — 5 February 2026 (Budget 2025 counter-tariff revenue and remission table)
- United States Surtax Remission Order (Motor Vehicles 2026), SI/2026-13 — Canada Gazette Part II, 8 April 2026
- United States Surtax Remission Order (2025), SOR/2025-122 — Canada Gazette Part II, 7 May 2025
- SOR/2025-122, consolidated text (section 5 conditions) — Justice Laws Website
- Order Amending the United States Surtax Remission Order (2025), SOR/2026-154 — Canada Gazette Part II, 1 July 2026
- United States Surtax Order (2026), SOR/2026-186, and its Regulatory Impact Analysis Statement — Canada Gazette Part II, 23 September 2026
- Customs Act, RSC 1985 c. 1 (2nd Supp.), s. 74 — Justice Laws Website
- Corporations Canada, federal incorporation fee ($200 online)
- Bank of Canada Valet, FXUSDCAD daily average — 6 October 2026