Lower Tariffs on UK Imports to Canada

Summary#

This bill updates Canadian laws to implement the United Kingdom’s (UK) entry into the Comprehensive and Progressive Agreement for Trans‑Pacific Partnership (CPTPP). It creates a new UK‑specific preferential tariff (CPUKT), phases many customs duties on UK goods down to zero, and aligns several federal statutes with the CPTPP accession protocol. The Act takes effect on a date set by the Governor in Council.

• Creates the “Comprehensive and Progressive United Kingdom Tariff” (CPUKT) and applies it to the UK, the Isle of Man, and the Channel Islands (Clause 13; List of Countries update).
• Cuts many customs duties on UK goods to 0% immediately or in stages through 2028–2029 (Clause 14; Schedule 3).
• Keeps some sensitive items with no UK preference (“N/A”), including many dairy, poultry, eggs, and certain processed foods (Schedule 2).
• Lets the government extend, by order, UK tariff eligibility to goods incorporating inputs from other CPTPP countries (called “cumulation”), including retroactively to the CPTPP‑UK start date (Clause 15).
• Updates banking, insurance, arbitration, and trade implementation statutes to reference CPTPP accession protocols and a revised Schedule IV list (Bank Act s.14.11; Schedule 1; Clauses 1–12, 17–21).
• Bars any tariff cuts before the CPTPP is in force between Canada and the UK (Clause 14(5)).

What it means for you#

• Households

  • Many UK goods will face lower or zero import duties once CPTPP is in force between Canada and the UK. Examples include footwear (some lines drop from 18% to 0%), sugar and sweets, baked goods, and certain vehicles (6.1% to 0%) (Schedule 3).
  • Some items remain non‑preferential (“N/A”), notably many dairy, poultry, eggs, and certain processed meats and foods (Schedule 2).
  • Duty rates round down during each cut, and any non‑vehicle rate below 2% becomes “Free” immediately, which can speed up duty elimination (Clause 14(6)–(9)).

• Workers

  • No direct changes to labour laws. Changes are focused on tariffs and regulatory references (bill text throughout).
  • Industries that compete with covered UK imports (e.g., footwear, confectionery, shipbuilding, some vehicles) may see more import competition as tariffs fall (Schedule 3). Data on employment impacts: Data unavailable.

• Businesses

  • Importers from the UK can claim CPUKT rates. Some items are duty‑free at once; others phase down in steps labeled X78, X79, or X80 through 2028–2029 (Clause 14; Schedule 3).
  • Customs compliance will require using CPUKT and the correct staging code; rates round down, and sub‑2% non‑vehicle rates go to “Free” (Clause 14(6)–(9)).
  • The government may allow “cumulation” (counting inputs from other CPTPP partners as UK content) by order, which can broaden eligibility for CPUKT, possibly retroactively to the CPTPP‑UK start date (Clause 15).
  • No tariff reductions apply until CPTPP is in force between Canada and the UK (Clause 14(5)). The Act itself starts on a date set by order in council (Coming into Force).
  • Banks and insurers: definitions of “regulated foreign entity” and Schedule IV references change. The Governor in Council can amend Schedule IV by order for trade‑related purposes (Bank Act s.2, s.14.11 as amended; Insurance Companies Act s.2; Schedule 1).

• Local governments

  • No direct mandates. Purchases of covered UK goods could face lower import duties after the CPTPP‑UK start date (Clause 14; Schedule 3). Data on savings: Data unavailable.

• Service users

  • Arbitration references are updated to include CPTPP accession protocols. Practical effect on most users is minimal (Commercial Arbitration Act, Schedule 2 update).

Expenses#

• Estimated net cost: Data unavailable.

• Key points

  • Fiscal note: No publicly available information.
  • Appropriations: None stated in the bill (bill text throughout).
  • Revenue effects: Customs duty revenue will likely decrease as many UK tariff lines fall to 0% by 2028–2029 (Clause 14; Schedule 3). Magnitude: Data unavailable.
  • Administrative costs: Statutory and schedule updates across several Acts; no cost estimates provided. Data unavailable.

Proponents' View#

• It delivers Canada’s legal obligations to implement the UK’s CPTPP accession by updating definitions, schedules, and references across statutes (CPTPP Implementation Act s.2, s.9(2); Clauses 1–12, 17–21).
• It reduces import costs by cutting many UK tariff lines to 0%, some immediately and others in stages through 2028–2029 (Clause 14(2)–(4); Schedule 3).
• It protects sensitive sectors by keeping many supply‑managed and selected agri‑food items non‑preferential (“N/A”) (Schedule 2).
• It provides clear, dated staging (X78, X79, X80), rounding rules, and immediate elimination of sub‑2% non‑vehicle rates, which can simplify administration (Clause 14(3)–(4), (6)–(9)).
• It enables cumulation with other CPTPP partners by order, which can make supply chains more flexible while tying any retroactivity to the CPTPP‑UK effective date (Clause 15).
• It allows timely technical updates through order‑in‑council to Schedule IV for financial statutes, keeping Canada aligned with evolving trade obligations (Bank Act s.14.11 as amended; Schedule 1).

Opponents' View#

• Customs revenue will fall as duties drop to 0% on many UK goods; no official estimate is provided (Clause 14; Schedule 3). Budget impact: Data unavailable.
• Domestic producers in covered sectors (e.g., footwear at 18% to 0%; some sweets and baked goods; certain ships at 25% to 0%; some vehicles at 6.1% to 0%) may face higher import competition (Schedule 3). The bill provides no adjustment measures.
• The Governor in Council gains broad authority to amend Schedule IV (Bank Act s.14.11 as amended) and to extend CPUKT entitlement, including retroactively, which may reduce parliamentary oversight (Clause 15; Schedule 1).
• Complex staging (X78, X79, X80), rounding rules, and item‑level exceptions increase compliance risk for importers and brokers, raising the chance of errors and disputes (Clause 14; Schedules 2–3).
• Timing is uncertain because the Act and tariff changes depend on orders and on when CPTPP is in force between Canada and the UK, which can complicate business planning (Clause 14(5); Coming into Force).