Specifically, suppose I buy an i-phone from China, paying whatever duty Canada collects and then go to the US with the declared intention of selling it. Would it be dutied as an import from China or one from Canada?
It’s really a bit like marrying somebody who’s in the US temporarily, like on a student Visa: you’ll likely undergo a fair bit of scrutiny to determine whether the marriage was ‘bona fide’ or whether it is a bad faith effort to circumvent rules and laws.
I suspect there’s a fair bit of scrutiny going on over at Customs and Border Protection (CBP) as goods enter the US right now.
It should be tariffed as Chinese manufactured. That being said, Trump quietly issued a revision last night that withholds the tariffs from computers and phones.
From China. I once tried to take some t-shirts into the US to sell at an event, and the custom guys wanted their full manufacturing history right back to where they were originally sewn. They take that stuff seriously.
Yeah, I just heard that on the 5 O’clock news. This is crazy.
This is not an uncommon situation and you should be able to claim “drawback” from Canada customs and receive their duty back, your still on the hook for the US tariff.
Most products, such as electronics and clothing, have a country of origin tag somewhere. Other stuff will just be vague. Google AI says
- Online Products:
Country-of-origin labels are generally not required for online products.
- Exceptions and Misleading Claims:
There are exceptions to the country of origin labeling requirement, and it’s crucial to avoid misleading consumers about the origin of a garment.
LINK
Generally, it’s country of origin. There’s an exception for personal goods bought abroad ($800 after being out of country 48 hrs, IIRC) It is the same for mail parcels, $800, but I read somewhere Trump was cancelling that exemption. (on-again-off-again, so who knows).
Then there’s the difference between personal goods and importing for commercial purposes. From what I gather, Customs is touchy about anything to do with work or commerce.
I saw something that new cars going back and forth between factories in the USA and Canada, would be assessed based on the proportion of value made in each country. A fully assembled car from a Canadian plant, with some American parts, would be assessed based on the proportions.
This sort of “what proportion” will become important as other countries assess reciprocal tariffs. many American goods include parts imported to the USA.
Transshipping has no effect. It’s country of origin. Presumably, some manufacturers will lie on labels. I would not be surprised if China manufacturers ship some plausible goods - like garments - to places like Vietnam, with much lower tariffs (so far) who label them “Made in Vietnam” and then ship them to the USA. This is of course fraud.
As for iPhones, I understand Trump has said tariffs on iPhones and other electronics are coming soon, bigly, on the stuff that is not being tariffed from China for now - and for other countries too.
AFAIK Canada does not apply any significant tariffs on iPhones. It’s not like we have a child labour sector to protect( 
). But anything imported pays the GST (VAT).
This is where Trump is confused (just one among many things). GST or VAT is charged on essentially everything at each stage. Then when it’s resold onward, the seller deducts the VAT already paid. Thus the final end sale price has the tax percentage on the retail price. There is no tax advantage in importing or in making locally. Goods exported, the seller can reclaim what would be the GST/VAT. The theory is, then the full VAT is collected by the destination country from the importer. If the USA does not have a VAT sales tax, that’s their problem.
Essentially, goods arriving in the country have full VAT applied on arrival, goods leaving the country, it’s as if there was no VAT. It’s neutral. Each country applies this their own way. Trump just thinks the sales tax applied on imports is a tariff, so an excuse to hit the countries with tariffs in reply.
Yeah, VAT = value-added tax. A great explanation.
When asked why they applied a 10% tariff on penguins, the White House excuse was “in case countries try to transship through there and pretend it was made there.” Despite having no ports and zero population. Presumably they were worried about the effect of Heard Island exports on the local guano industry.