Canada Post has temporarily stopped accepting online purchases of stamps and collectibles destined for the United States, adding another complication for American collectors seeking Canadian philatelic material as cross-border customs rules continue to change.
A notice posted prominently on Canada Post’s online store states: “Due to U.S. customs changes, we can’t accept purchases with a U.S. destination right now.” Canada Post adds that it is actively working on a solution.
The development comes just one day after Canadian Stamp News reported that the Canadian Stamp Dealers Association (CSDA) had warned its members about a new U.S. tariff measure scheduled to take effect Aug. 19 that could impose an additional 50 per cent duty on certain Canadian-origin philatelic material entering the United States.
Canada Post has not stated that the temporary purchasing restriction is specifically the result of the new 50 per cent tariff. Its notice refers more broadly to changes in U.S. customs requirements.
U.S. COLLECTORS AFFECTED
The restriction is significant because Canada Post’s online store provides collectors with direct access to new Canadian issues, including stamp booklets, souvenir sheets, Official First Day Covers, postage-paid postcards, quarterly collector packs and other philatelic products.
As of Aug. 18, the online store continued to display its regular selection of stamps and collectibles, including recently released issues. However, purchases with a U.S. destination are currently not being accepted.
The situation could be particularly frustrating for American collectors who routinely purchase new Canadian issues directly from Canada Post rather than through dealers or other secondary-market sources.
Canada Post has not indicated how long the restriction will remain in place, saying only that it is working on a solution.
CUSTOMS RULES ADD COMPLEXITY
Shipping merchandise from Canada to the United States has become increasingly complicated as new customs and tariff requirements are introduced.
Canada Post uses Zonos to assist with the calculation and collection of duties on applicable U.S.-bound shipments. Businesses shipping merchandise south of the border are being required to pay closer attention to tariff classifications, country of origin and the duties that may apply before parcels are accepted for shipment.
Canada Post has advised businesses to review U.S. shipping requirements carefully, ensure products are properly classified and keep customers informed about possible duties and additional costs.
Those requirements are particularly important for stamp dealers whose shipments may contain material from several different countries or a mixture of stamps, covers and other collectibles.
CSDA SOUNDED WARNING
The Canada Post development comes at the same time as an advisory issued by the CSDA warning Canadian stamp dealers about the proposed additional 50 per cent U.S. tariff.
Of particular concern to the philatelic trade is the inclusion of tariff classification HTSUS 9704.00.00 among the Canadian products targeted by the measure.
That classification covers postage and revenue stamps, stamp-postmarks, first-day covers, postal stationery and similar material, used or unused, other than material falling under heading 4907.
The CSDA advised members shipping Canadian philatelic material to U.S. customers to review the situation with their customs broker, carrier or shipping provider and confirm the appropriate tariff classification and country of origin for the material being shipped.
The association also cautioned members not to change tariff classifications simply to avoid the additional duty.
Since issuing its advisory, the CSDA has received reports that some shipping systems are already reflecting the new tariffs ahead of the formal Aug. 19 implementation date.
One Canadian stamp dealer advised the association that UPS was already applying the 50 per cent tariff to impacted stamp shipments. The dealer also reported that Canada Post’s Zonos system was calculating the 50 per cent tariff on affected stamps.
POTENTIAL COST SIGNIFICANT
If covered Canadian-origin philatelic material is assessed the additional duty, the impact on collectors and dealers could be substantial.
As a simple example, a shipment of Canadian stamps with a customs value of $200 US could potentially attract an additional $100 US in duty before other applicable charges.
That creates a significant concern for Canadian dealers who rely on American collectors as an important part of their customer base. It could also affect the willingness of U.S. collectors to purchase Canadian material directly from dealers and auction houses north of the border.
For Canada Post, the immediate response has been to temporarily stop accepting U.S.-destination purchases through its online collectibles store while it works through the changing customs requirements.
TALKS CONTINUE
There remains some hope the tariff situation could change.
The federal government continues discussions with the U.S. administration ahead of the Aug. 19 implementation date, with Canada seeking relief from the new tariffs.
As Canadian businesses have seen throughout the ongoing trade dispute, tariff measures and implementation dates can change as negotiations progress.
Until an official change is announced, however, Canadian stamp dealers are being advised to prepare on the basis that the new measures will take effect.
For collectors, the Canada Post restriction provides a tangible example of the uncertainty now surrounding cross-border philatelic commerce. Canadian dealers are facing questions about how duties will be assessed when stamps are shipped south, while U.S. collectors have temporarily lost the ability to order Canadian stamps and collectibles directly from Canada Post’s online store.
Canadian Stamp News will continue monitoring developments and provide updates as additional information becomes available.