Factors To Consider In Cross-Border Trade

 Jun, 23 - 2021   EcommerceTipsTruckload

Every businessman that has experienced cross-border trade will tell you that it is much easier to ship goods domestically than across the border because there are many variables to consider. Some of the variables include taxes and duties, currency conversion, and trade restrictions and limitations.

One of the most significant differences in the various taxes imposed on intra-Canada shipments. Intra-Canada shipments mean the shipment of goods from one Canada address to another Canada address. Each Canadian province has a list of what taxes will be applied to a specific shipment. It is typical for a province to use one of or a combination of three tax codes like goods and services tax (GST), harmonized sales tax (HST), and provincial sales tax (PST).

Meanwhile, Quebec has its own unique tax code the Quebec state tax or QST that is applied to shipments with an origin and destination in Quebec. However, all provinces use the combination that has been mentioned above but with slight variations.

Shippers have to pay customs duties or import tax for goods that are moved across the border. USMCA has reduced or eliminated tariffs to lower retail prices for consumers and increase the profits of merchants.

Like other countries, Canada has its own currency which makes things more complicated for shippers. Currency conversion typically becomes a problem when the shipper prefers to pay for the goods in Canadian dollars. If the transportation management system of the logistics company does not support currency conversion, processing has to be done manually which can be quite tedious.

Another issue is when the currency needs to be converted during the shipment process. Foreign exchange rates tend to change daily. What the customer was quoted at the start of the shipping process may not include the applicable sales tax from various processes. This can result in discrepancies in the customer’s invoice and commercial invoice.

If you are looking for reliable cross-border transportation for your goods, your best option is Titan Transline, a 3PL logistics and trucking provider with years of experience in cross-border trade. Your goods will be provided with personalized and caring service with regular timely updates.

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