CBSA's latest update to Customs Notice 25-11 splits the steel and aluminum surtax into two rates and four codes, effective immediately. Here's what changed, and what to check first.
Highlights
- CBSA doubled its steel and aluminum surtax to 50%, effective September 8, splitting rates into four new codes.
- Four new surtax codes replace two, and misclassifying an HS number now cascades into steep, compounding duty errors.
- ONESOURCE Global Trade solutions track schedule changes, confirm classifications, calculate landed costs, and file CARM declarations directly.
Effective September 8, 2026, the Canada Border Services Agency doubled its surtax on select U.S. steel and aluminum goods, from 25% to 50%, on shipments that may already be en route. This is the fourth amendment to Customs Notice 25-11, the order that governs the Canada steel surtax since it was first imposed in March 2025, and it’s Canada’s direct response to the United States imposing new Section 338 tariffs on a range of Canadian goods. For trade teams, the immediate problem isn’t the policy debate. It’s that the same HS number that sat in one surtax bucket last week may sit in a different one this week, and getting it wrong now costs twice what it used to. It’s a live rate change, already in effect on today’s shipments.
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What changed with the Canada steel surtax?
Why is Canada increasing its steel surtax?
How does ONESOURCE help manage Canada steel surtax changes?
What changed with the Canada steel surtax?
The mechanics matter more than the headline number. CBSA split the existing schedules in two: aluminum and steel goods that remain in the original Schedules 1 and 2 continue at the 25% rate, while goods moved into new Schedules 1.1 and 2.1 now carry a 50% rate. The same tariff heading can land in either bucket depending on the specific good, so a classification that was correct last month isn’t guaranteed to still be correct today.
The changes come down to these three points:
- Four surtax codes instead of two. CARM declarations now need one of four codes: 26187A and 26187C for aluminum and steel at 25%, 26187B and 26187D for aluminum and steel at 50%. Picking the wrong one isn’t a paperwork slip, it changes what you owe.
- A narrow grandfather clause. Goods already in transit to Canada as of September 8 still qualify for the 25% rate, under legacy code 25095A, but only with proof in hand: a bill of lading, cargo control documents, or another record showing the goods were already moving before the rate changed.
- Compounding math, not simple math. CBSA’s own worked examples show the surtax stacking with MFN duty, antidumping duty, and GST. On a $150 shipment with no other duties owed, CBSA’s own numbers put the difference between the 25% and 50% surtax tiers at roughly $40 in total taxes owed, and that same gap carries through unchanged once antidumping duty is added to the calculation, since it applies equally at either rate. A misclassification doesn’t miss one number, it cascades through the entire landed cost calculation on every affected entry.
Why is Canada increasing its steel surtax?
Canada says the increase responds directly to the United States imposing new Section 338 tariffs on a range of Canadian goods, effective in August 2026. That single fact explains why this notice exists, but it doesn’t explain why trade teams should expect it to be the last one. Four amendments to the same notice in eighteen months isn’t a fluke, it’s a cadence. And the pattern predates this one order specifically.
Thomson Reuters Institute’s 2026 Global Trade Report found that 76% of trade professionals now believe U.S. tariff volatility specifically represents a permanent, multi-year shift rather than a short-term tool tied to one administration. Canada’s surtax is a retaliatory response to that same volatility, not a separate phenomenon, and the same logic applies: treating this update as a single event to absorb and move past misses the pattern. A fifth amendment is not a hypothetical.
What are the compliance risks of the Canada surtaxes? This isn’t a documentation gap the way some regulatory changes are. It’s a currency gap. The question isn’t whether you have the right paperwork on file, it’s whether your classification and coding logic reflects what’s true as of this morning, since the answer can change again with the next amendment. Thomson Reuters content teams tracked more than 155 million tariff updates globally in 2025, with 2026 on pace to exceed that, which gives some sense of how often the ground actually shifts under a static classification file.
A misapplied surtax code doesn’t stay contained to a single shipment. It repeats on every entry using that classification until someone catches it, and CBSA’s own post-release verification program exists specifically to catch it, typically with interest and penalties attached once it does.
How does ONESOURCE help manage Canada steel surtax changes?
This is a moment for currency, not just documentation. Trade teams need to know which schedule a given HS number sits in today, not last quarter, and they need the compounding math to run correctly the first time.
- ONESOURCE Global Trade Content tracks tariff schedule changes like this one directly, so classification data reflects CBSA’s current schedules rather than a static lookup someone updates manually after the fact.
- ONESOURCE Global Classification powered by CoCounsel helps confirm which schedule a given product actually falls into as CBSA splits and re-splits its tariff schedules, reducing the chance a classification decision made last month is quietly wrong today.
- ONESOURCE Import Management automatically calculates landed costs at the point of entry, including the stacked surtax, MFN duty, antidumping duty, and GST math that CBSA’s own examples show cascading from a single misclassification. It also keeps the documentation trail, including proof of transit timing for the grandfather clause, organized and ready if CBSA requests it during a post-release verification.
- ONESOURCE Government Connectivity files declarations directly with CBSA, cutting out the manual rekeying where a mistyped or outdated surtax code most often slips into a CARM declaration in the first place.
What to check this week
This notice is already in force, so the practical first move isn’t strategic, it’s an audit. Review CARM declarations filed around September 8 against the new four-code structure now, before CBSA’s verification program does it for you. Confirm which schedule your affected HS numbers actually sit in today, not which one they sat in a month ago. And if any shipments are claiming the in-transit exception, make sure the supporting documents are already on file, not just on the way. The teams that build for continuous tariff volatility, rather than reacting to this one update, are the ones who won’t be relearning this same lesson at the next amendment.
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