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Playing Customs Games with Our Northern Neighbors

Lately, i have been confronted with buyers from Canada who have insisted that i declare an artificially low value for an item that i am selling so that they can avoid the heft customs duties in Canada. In one case, this request was made AFTER the buyer had already paid me. In a subsequent case, i told the prospective buyer up front that i would not mis-state/under-insure the the item and this put an end to our discussions (presumably, the customs fees would have been so significant that we couldn't resolve this by simply "pricing it into the deal.")

I have no problem selling to buyers from Canada, but i do have a problem providing false statements on a Customs Declaration. Am I over-reacting?
jeffreybowman2k
lousyreeds1's avatar
lousyreeds1
286 posts
 
I was always under the impression that there is no duty on used merchandise. Is that not the case? In my experience, when I've written USED MERCHANDISE on the customs label, there no duty has to be paid.
tms0425
72 posts
 
Selling into Canada there is no duty either way. My understanding is there is sales tax on transactions used or new. It is a General Sales Tax (GST) and possibly Provincial Sales Tax (PST) levied after it clears customs, which adds up to as much as 14%.
tobias
1,534 posts
 
Fees on goods going to Canada:

N.A.-manufactured:
GST (Goods & Services Tax) + PST (Provincial Sales Tax) + brokerage + shipping

Made outside North America:
Duty + GST + PST + brokerage + shipping

Duty, if any, and taxes are charged on the declared value of the goods. It doesn't matter if the goods are used or new.

The sale price of the item will be verified if an insurance claim is made. Transaction records such as auction postings and bills of sale will be required to prove the amount paid. Besides being illegal to falsify a customs declaration, it is a foolish risk.
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oregonpapa's avatar
oregonpapa
4,867 posts
 
I say pay the taxes and don't cheat. With that said, money, like water, follows the path of least resistance. Therefore, we have tax avoidance in a multitude of ways, running the whole gambit from under-valuing a piece of audio equipment coming across the Canadian border to offshore bank accounts.

Frank
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