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US, Mexico & Canada e-commerce sales tax & duty thresholds


US, Mexico & Canada e-commerce sales tax & duty thresholds

As part of the NAFTA renegotiation completed on 1 Oct 2018, the US has secured a rise in the duty-free threshold for e-commerce sales from US marketplaces to consumers in Mexico and Canada. The new NAFTA replacement deal is known as United States-Mexico-Canada Agreement (USMCA).

Currently, US online sellers, including eBay and Amazon, shipping to consumers in Mexico are sales tax and import duty free up to $50 per shipment.

The Mexican VAT threshold will now been retained at $50, but the customs duties limit raised to $117. The Canadian import duty and GST threshold is currently C$20 per parcel. It will be raised to  C$40 for GST/HST, and C$150 for duties. Mike Dabbs, eBay’s government relations director for the Americas, said separate tax and custom duty thresholds could create confusion. “That does not help the experience for small businesses and consumers,” he said.

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VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.