Changes to excise duty rates on tobacco products

The Canadian Government’s 2021 Budget includes Notice of Ways and Means Motion increasing the rates of excise duty on tobacco products effective April 20, 2021. The rates increase does not apply to the excise duty on raw leaf tobacco and to the special duty on stamped tobacco products manufactured in Canada and exported.

Effective April 20, 2021, the Government will collect the increased duty, paid on a voluntary basis, until such time as the amendments become law (that is, until they receive Royal Assent). Importers and licensees that do not pay the duty in accordance with the new rates as of the date cited above will be required to pay interest on unpaid amounts once Royal Assent is received.

The Canada Revenue Agency published an Excise Duty Notice which includes the new and previous rates.

The Canada Border Services Agency issued Customs Notice 21-09 providing instructions on the tax payment for imported tobacco products.

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