The impact of the U.S.-Canada trade war on boating.
It’s shaping up to be a very stormy nautical forecast. In short, we’re in a state of uncertainty.
The American president, Mr. Trump, has just given us a 30-day delay, and I do mean a delay. Where will we be in 30 days (i.e. around the beginning of March 2025). This uncertainty is not good.
The U.S. President has commissioned a study of trade relations with Canada, and the report is supposed to be available in April, so will April be when we know what the White House’s intentions are?
Some commentators mention that the White House’s ultimate goal is to review the Mexico/U.S./Canada Free Trade Agreement, so what’s going to happen with boating?
I’m thinking especially of Canadian boat dealers who sell U.S.-built boats. What with a Canadian surtax (customs tariff) of 25% when the boat passes through Canadian customs, what’s going to happen? (of course this is a hypothetical retaliatory measure).
Just think of these well-known brands:
– Sea Ray
– Regal
– Cruisers Yachts
– Boston Whaler
– Tiara
– Monterey
– Cobalt
– Chris Craft
– Wellcraft
– Fourwinns
– Crownline
– Bayliner
– Starcraft
– Ranger Tugs
– Cutwater
– Ranger Boats
– Mercury engines
– Lowe boats
– The vast majority of CENTER CONSOLE boats.
– Almost all PONTON brands
– Most fishing boats (except Princecraft)
In short, it’s huge. We used to have DORAL, which was Canadian, but now all the manufacturers are either in the U.S. or Europe.
Of course, boats built in Europe won’t be subject to this surtax or 25% tariff, since they don’t pass through America. We have a free trade agreement with Europe.
It’s called CETA.
But if you buy a European boat currently in American waters, when you import it into Canada, there’s currently a 9.5% tariff that’s been in force for years.
The question is, in 30 days after March 3, when the wave of tariffs is applied on the Canadian side (if Trump comes back with his 25% tariffs), will this tariff also increase from the current 9.5% to 25%?
We’re talking here about non-American-made boats:
For example:
AZIMUT YACHTS
PRINCESS YACHTS
FERRETTI
PERSHING
RIVA
PRESTIGE
SUNSEEKER
BENETEAU
JEANNEAU
ABSOLUTE
AQUILA
GALEON
AXOPAR
FAIRLINE
SESSA MARINE
etc…
We also have a free-trade agreement with Australia, so Riviera and Maritimo brands entering Canada directly will be excluded from the 25%.
Boats from China and Taiwan are already subject to 9.5% customs duty, so they too will not be subject to the 25% surtax.
But we do have the famous 10% luxury tax for new boats acquired after Sept. 1, 2022, regardless of origin.
So selling a used boat between Canadians is a great opportunity. If you’re thinking of selling your boat, this is an excellent opportunity during this price war.
Our web site http://www.propriobateau.ca with its different packages (with or without commission) and also a display on http://www.boatdealers.ca is worth considering. In brokerage mode, we also post on YACHTWORLD and BOATS.com.
Or, of course, buying a boat in the U.S. and leaving it on the U.S. side, or even outside Canada, allows you to avoid all taxes, whether Canadian or American. The brokers at Ita Yachts Canada are here to explain how…
Lake Champlain (in New York Territory or Vermont) allows you to exempt a boat from all Canadian taxes, and since it’s registered in Canada, it also exempts you from U.S. taxes. The Lake Champlain is about 45-50 minutes by car from Montreal.
In short, this trade war between Canada and the United States is changing things quite a bit.
It’s also causing the Canadian dollar to fall, making USD purchases much more expensive.
At the time of writing (Feb. 4, 2025), it costs $1.43 CAD to buy $1 USD, so a boat selling for $500,000 USD = $714,500 CAD.
If we add the 25% surcharge for passing through Canadian customs, it comes to $893,000 CAD. It just doesn’t make sense. And then you add GST and QST.
It’s almost like saying that buying a boat in the U.S. and bringing it back to Canada is going to be VERY expensive, if tariffs are applied.
Ideally, you should leave it in the U.S. (or outside Canada) during this tariff war, which can’t last very long.
But one thing is certain: this tariff war on the horizon is going to shake up the boat sales market in Canada considerably.
The 25% tariff for boats won’t be in effect as early as February 4 (according to preliminary information), but it may be in 30 days’ time, or as late as early April.
But here’s what Canada’s Minister of Finance had to say before the 30-day postponement (February 3, 2025):
There are still many uncertainties: will the tariff scenario apply to everything (including boats), or will there be exceptions?
In short, it’s an issue we’ll be keeping a close eye on. If you have any questions, please don’t hesitate to contact us.
DISCLAIMER
The article presented on this page is for information purposes only. This information is provided as editorial (i.e. opinion). The information presented in this article is presented in good faith and, while believed to be correct, is not guaranteed. Ita Yachts Canada does not warrant or assume any legal liability or responsibility for the accuracy, completeness or usefulness of the information and/or images displayed, as they do not suggest anything in relation to this article, indeed no association can be made with respect to the images and the article. All information in this article is subject to change without notice and is without warranty. It is the reader’s responsibility to verify the descriptions and statements contained in this article. The brokers at Ita Yachts Canada assume no responsibility for any conclusions the reader may draw. The purpose of this article is to promote boating in all its forms. It gives one point of view among many. Any reproduction of this article is prohibited.
