The recent decision by the United States to end its long-standing duty-free shipping rule has come as a major blow to Canadian small businesses that rely heavily on cross-border trade. For years, Canadian entrepreneurs benefited from the provision that allowed them to ship goods into the U.S. under a certain threshold without customers facing additional duties. The removal of this rule now means that even small-value shipments could face tariffs and administrative costs, significantly increasing prices for American consumers and making Canadian products less competitive in the U.S. market.
Small businesses are especially vulnerable because they lack the financial cushioning and logistics networks of large corporations. Many Canadian e-commerce sellers, artisans, and small manufacturers thrived by offering unique goods to U.S. buyers through online platforms. With higher costs and more red tape, these companies fear losing market share to domestic U.S. businesses or larger global competitors who can absorb the costs.
The move also strains broader Canada-U.S. trade relations, as Ottawa now faces pressure to negotiate exemptions or relief measures. Analysts suggest this could be part of a larger trend where Washington is reshaping trade policy to protect domestic industries, even at the expense of long-time allies. For Canadian small businesses, the concern is immediate: survival in an increasingly protectionist environment.
Beyond the economics, there is a human angle as well. Many of these enterprises are family-run or immigrant-led ventures that built their livelihoods on cross-border trade. The new rule threatens not only profits but also jobs, innovation, and growth opportunities. As Canada navigates this challenge, small businesses will be looking to both federal support at home and diplomatic pressure abroad to soften the impact of what feels like a sudden closing of the door to their largest market.
