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Some Canadian small businesses are now able to claim refunds for U.S. tariffs that were struck down as unconstitutional, despite other tariffs remaining in place for sectors such as steel and aluminum.
The Canadian Federation of Independent Business says about a third of Canadian exporters faced levies on goods that did not qualify for an exemption under the Canada-United States-Mexico trade agreement when President Donald Trump imposed tariffs under the International Emergency Economic Powers Act last year.
These non-CUSMA compliant goods were typically subject to tariffs at a rate of 35 per cent.
Of the firms that faced tariffs, the CFIB said about a quarter served as the “importer of record,” which could now qualify them for a rebate because they were legally responsible for the shipment entering the U.S.
The application system launched this week after a judge at the U.S. Court of International Trade determined in March that such companies were entitled to money back for Trump’s “Liberation Day” tariffs.
In a previous decision, the U.S. Supreme Court found that Trump usurped Congress’ tax-setting role when he set new import tax rates on products from almost every other country, citing the U.S. trade deficit as a national emergency.
Companies collectively paid billions of dollars in tariffs, which were struck down on Feb. 20. To apply for a refund, they must submit declarations listing the affected goods. The system will refund tariffs to the businesses that paid them, which are not obligated to share the proceeds with customers.
U.S. Customs and Border Protection said that if it approves a claim, it will take 60 to 90 days for a refund to be issued. The agency said in court filings that more than 330,000 importers of record paid a total of about US$166 billion on more than 53 million shipments.
Michelle Auger, the CFIB’s director of trade and marketplace competitiveness, said it’s too soon to know how many Canadian companies might apply.
The CFIB has offered guidance to Canadian small businesses on how to obtain a refund, with Auger noting it can be a “very complicated” system to navigate. The process requires firms to have a U.S. customs account and a U.S. bank account to obtain a refund.
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“For a small-business owner, it can be daunting, especially if several small shipments have crossed the border and you were the importer of record,” she said.
“It really is just about working with your customs broker, understanding whether or not your goods went through the border CUSMA-compliant or not, and from there assessing whether or not you paid what’s considered a sectoral tariff or the IEEPA tariff.”
Separate tariffs on steel and aluminum, cars, softwood lumber and furniture from Canada remain in place and are not included in the rebate process.
Richard Martin, the CEO of playground manufacturer Dynamo Industries Inc., said he has decided not to apply for a refund despite having paid tariffs as an importer of record.
He said both sectoral and IEEPA tariffs have weighed on his Plantagenet, Ont.-based business over the past year, having previously relied heavily on the U.S. market to sell “unique and outside-the-box” playground products.
But between the “intense” amount of documentation Martin said he’s had to produce when shipping materials across the border, and the administrative work he’d now need to undertake to prove Dynamo’s eligibility for a rebate, Martin believes it’s not worth it.
“I’m too exhausted. This paperwork nonsense and trying to retrace all of this is just too mind-boggling and too time, labour-intensive,” Martin said in an interview.
“It’s absolutely ridiculous, this load of stress that we’re putting on companies like us. You’re talking almost a salaried person just to keep up the paperwork now. That’s $60,000 a year for most companies. It’s absolutely ridiculous.”
Auger said Canadian businesses have endured significant “turbulence” trying to navigate the various levies since last year.
“The uncertainty of whether tariffs are on or off has just caused so much chaos and small businesses really have been taking the hit, have seen revenue losses, have seen lost customer contracts,” she said.
“With all of this, costs have continued to rise and then you add all the instability with the Middle East, which continues to increase costs right now, it’s just been one very roller-coaster of a ride this last year.”
—With files from The Associated Press
© 2026 The Canadian Press
