Canada consults on auto tariff remission changes

The Canadian government has launched consultations on potential changes to the country’s automotive remission framework, which it says could better align trade policy with industrial and workforce objectives. The consultations are part of a new strategy announced by Prime Minister Mark Carney on 5 February 2026 to support the domestic automotive industry.

Vehicle assemblers, parts producers, importers, workers’ associations and unions are invited to submit feedback on potential changes to tariff remission for surtaxes on passenger vehicles made in the United States by 13 April 2026. The government said the changes under consideration aim to further incentivise companies to produce and invest in Canada.

Canada’s automotive sector supports over 500,000 workers and contributes more than CA$16bn annually to GDP. Over 90% of Canadian-made vehicles and 60% of Canadian-made parts are exported to the United States. Since April 2025, Canadian-made vehicles have faced a 25% US tariff on non-US content.

In a statement, François-Philippe Champagne, Minister of Finance and National Revenue, said: “Canada’s auto sector is a pillar of our economy, and our government will do what is necessary to protect and maintain its competitiveness and the well-paying jobs it sustains.”

Under the current remission framework, companies that produce in Canada can import US-made vehicles tariff-free up to a quota, provided they maintain production levels and follow through on planned investments.

Source: Government of Canada