(Ottawa) Given the many levels of customs duties and exemptions imposed by the United States, some economists claim that the effective rate on Canada is much lower than what key figures suggest.
The main economist of the Royal Bank (RBC), Claire Fan, said in an interview that the effective rate is the average import duties paid on goods intended in the United States, which take into account the exemptions related to the Canada-United States Agreement (ACEUM).
Although the American president, Donald Trump, increased general customs duties in Canada to 35 % at the beginning of the month, this measure maintained an exemption for goods in accordance with this trade agreement.
The Royal Bank estimates that the effective rate on Canadian goods is closer to 6 % today. The BMO calculations, carried out at the beginning of the month, locate this figure slightly higher, around 7 %.
The Bank of Canada said at the end of July, before Donald Trump’s last escalation, which she estimated the actual American rate rate at around 5 %, against almost nothing at the start of the year.
The calculation of the Royal Bank is based on data on the volume of exports of 2024. Other series of data offer measures slightly different from the customs pressure facing companies.
Mme FAN said that, according to data published by the United States census office, Canada’s effective rate was around 2.4 % in June, before the entry into force of the last wave of customs duties.
This figure reflects the real rights paid on the Canadian-American border, she said, and could be invalidated due to the delays in declaration and the general confusion concerning customs levels among companies.
“It is not surprising that there is a certain confusion to customs,” she pointed out.
The effective rate could also be lower in practice, as American companies turn on imports from Canadian products subject to the highest rights, added Mme Fan.
If the effective rate offers a simple explanation for the total level of American customs duties with which Canada faces, the RBC economist warned that he can underestimate the field impact.
“This is not the best indicator of the severity of customs duties, but it is unfortunately one of the only ones we have,” she said.
Compliance with ACEUM does not overall exercise Canadian sectoral rights products, such as those imposed under article 232 of US commercial legislation.
American customs duties of 50 % on steel and aluminum, for example, will have a considerable impact on these sectors in the future, warned Claire Fan.
At around 6 %, Canada’s effective rate is much lower than the cumulative rate that the other trade partners in the United States are currently faced, which RBC estimates from around 15 to 17 %.
“This is the essential point, and that is why we are always one of the countries least subject to American customs duties at present,” said Mr.me Fan.
Economists do not know exactly how much Canadian goods entering the United States is exempt from customs duties under ACEUM.
The Bank of Canada indicated in its report on the monetary policy in late July that it presumed that Canadian companies would comply collectively at ACEUM for 95 % of non -energy goods, in a scenario where the customs situation would be maintained over the next three years.
The Central Bank does not presume perfect compliance, because some companies may not want to pay administrative formalities linked to obtaining an exemption.
Mme Fan added that exemption from compliance with ACEUM is the essential element that gives Canadian exporters a “competitive advantage” compared to other economies strongly subject to customs duties.
Adam Slater, chief economist at Oxford Economics, said in a report published Monday that, despite the huge uncertainty linked to trade in trade with the United States, Canada and Mexico could take advantage of ACEUM as long as it remains in force.
The trade agreement must be renegotiated in 2026.
According to data from the United States Census Office of June, Oxford estimates that the actual customs duties rate for China is 35 %, for Japan at 15 %and for the United Kingdom at 8 %.
The Cabinet estimates that, at 2.5 %, the effective rate of Canada is slightly higher than the RBC estimate based on data from the US census office, while Mexico is estimated at 4 %.
“If relatively low customs duties apparently paid on imports from Mexico and Canada persist, these two economies could benefit from changes in supply chains, even if uncertainties on the end of customs duties and the future of the agreement (ACEUM) will constitute short -term brakes,” wrote Mr. Slater.
