You may have seen headlines about the new Canadian counter-tariffs. And if you make cosmetics, you may have noticed that “cosmetics” shows up on the list.
The good news is that it’s not ALL cosmetic products, and it doesn’t much change how you would ship products to Canada. The bad news is that it does apply to SOME cosmetics that you MIGHT make, and it definitely will make a difference to your Canadian customer.
Tariff, Duty, Surtax: Quick Definitions
The news tends to be a little loose is which words they use for what, which tends to confuse matters. That never helps., Here’s what each one actually means.
- Duty (or customs duty) is the regular tax a country charges on imported goods. The rate depends on the product’s tariff classification code. Most U.S.-made goods enter Canada duty-free.
- Tariff has two meanings. In everyday use, it’s the duty or tax itself, especially a new one added for trade-policy reasons. Technically, it’s the official schedule of product codes and duty rates (Canada’s Customs Tariff).
- Surtax is an extra tax added on top of whatever else is owed. It’s the legal name Canada uses for its counter-tariffs because they are imposed under the United States Surtax Order (2026).
- Counter-tariff (or retaliatory tariff) is the news-headline name for the same surtax.
Bottom line? When you see “counter-tariff” in the news and “surtax” on paperwork, it’s the same thing: an extra tax imposed for some reason on US goods coming into Canada.
What’s Covered (and What’s Not)
The new surtax (the “counter-tariff” you’ve heard about) applies only to products that are made in the U.S. and that fall under a tariff item on Canada’s list. If you make your products here, the first part is a given. So the real question is the second part.
The tariff list is long, made up of a “Harmonized System” with headings and numbers. It breaks out all products into some category or another. The simple version is that the following items are on the list for the new surtax:
- Lip make-up preparations (e.g. lipstick, lip balm)
- Eye make-up preparations (e.g. eye shadow, mascara, eyeliner)
- Fragrances and perfume (e.g. body spray, perfume)
- Manicure or pedicure preparations (e.g. cuticle cream, nail polish, foot soak)
- Hair conditioners, hair oils and serums, pomades, gels, leave-ins and similar
Products in those categories are subject to a 50% surtax.
NOT on the list, and NOT subject to a surtax: everything else that could be considered a beauty or make-up preparation or a preparation for the care of the skin (e.g. face make-up, powders, lotions, creams, serums, shampoo and soap).
A Few Gray Areas
Classification isn’t always obvious, and it’s CBSA (the Canada Border Services Agency) that makes the final call.
- Lip balm. Lip balms, including tinted ones, are often classified as lip preparations (3304.10), even when they’re more about care than color. So a lip balm could be caught by the 50% tariff.
- Tinted moisturizer or BB cream. Usually “other” (3304.99), so not on the list, but it can depend on how the product is positioned.
- Eye cream. That’s skin care (3304.99), not eye make-up. Eyeliner and eyeshadow are eye make-up (3304.20).
Shipping Requirements
Thankfully, the paperwork on your end is pretty simple. For a typical order shipped by USPS, the only form you need is the customs declaration.
Which form? It depends on the mail class:
- First-Class Package International: PS Form 2976 (CN 22), for merchandise under US $400 and under 2 kg (4.4 lb)
- Priority Mail International: PS Form 2976-A (CN 23), at any value
USPS doesn’t want these forms filled out by hand; since September 2025, they require customs forms to be created electronically. Whatever shipping software you use (e.g. Click-N-Ship, Stamps.com) can typically generate the form and print it with the label. If you have a Shopify store and print your shipping labels through the Shopify interface, you can probably use the built-in system to print the required form.
Important notes for the form
| Field | What to enter |
|---|---|
| Content type | “Merchandise” (it’s a sale, not a gift) |
| Description | Be specific: “Lipstick” or “Mascara,” not “cosmetics” or “beauty products” |
| Quantity, value, weight | For each product type; value is the actual sale price in USD |
| Country of origin | United States |
| HS tariff code | 3304.10.0000 – Lip make-up preparations 3304.20.0000 – Eye make-up preparations 3303.00.0000 – Fragrances and perfume 3304.30.0000 – Manicure or pedicure preparations 3305.90.0000 – Hair preparations |
You shouldn’t need a US export filing (that kicks in at $2,500) or an official “Certificate of Origin.” A commercial invoice or packing slip isn’t required, but putting an invoice inside the package and a packing slip on the outside is generally a good idea.
What Happens on the Canadian End
Once your package crosses the border, it’s out of your hands. USPS hands it to Canada Post, Canada Border Services Agency assesses whatever is owed, and Canada Post collects it from your customer at delivery. And keep in mind, small orders aren’t exempt.
Here’s what your customer may pay:
- The surtax. 50% of the value for duty (converted to Canadian dollars) for lip, eye and nail products.
- Canada’s federal and provincial sales taxes. 5-15% (varies by province).
- Canada Post handling fee. CAN $9.95 (currently about $7 US) on any mail item that owes duty or tax. It’s a postal fee, not a government tax.
YIKES!!!
Final Thoughts
For most soap and cosmetic makers, the new Canadian tariffs are narrower than the headlines make them sound. Soap isn’t affected. Skin care isn’t affected. Lip, eye and nail products (along with fragrances and some hair products) are the ones to watch.
Unfortunately, the whole idea of the surtax is to deter Canadians from buying US goods. It’s intended to affect the big companies, but it has a marked effect on single consumers looking to make small personal purchases from US vendors. It can add real cost for your customer.
It’s worth being very up-front with your Canadian customers (not just a side note in a FAQ or a buried paragraph on your shipping page). That way they know about it before they order, not when they’re presented with a big bill when their package arrives.
Otherwise you’re likely to have unhappy customers, and that’s not good for any business.
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