Selling Online to Japan from Canada: Duties, Consumption Tax and the 2028 Rule Change

Yes, and Japan's tax system has been built around exactly this kind of parcel. Japan's Ministry of Finance reports about 190 million import permits in 2024, and roughly 90% of them were low-value consignments with a total customs value of ¥10,000 or less. Most cross-border orders from a Canadian store to a Japanese shopper land in that bucket.

That is about to change. Japan passed a law on March 31, 2026 that moves consumption tax on these small parcels from the border to the checkout, starting April 1, 2028. A Canadian store planning a Japanese launch now should design pricing, checkout and tax registration for the 2028 rules rather than the current ones.

Japan Customs exempts goods with a total customs value of ¥10,000 or less from customs duty and consumption tax. Liquor tax and tobacco tax are not exempted. The value is counted per import declaration, or per package for postal items, and parcels split by the same sender to the same recipient at the same time are added together, so splitting an order does not avoid the threshold.

The customs value depends on who is buying. For goods a person imports for their own use, it is the overseas retail price multiplied by 0.6, which is why items selling for up to ¥16,666 have qualified. For other goods, it is the price plus freight and insurance, so shipping charges count toward the ¥10,000.

Some products never get the exemption: Japan Customs lists leather bags, handbags and gloves, knitted clothing such as T-shirts and sweaters, ski boots, and leather shoes. Above ¥10,000 and up to ¥200,000, a simplified duty table with seven bands applies to many goods, for example 10% for non-knitted clothing, 3% for plastic, glass and furniture, and 5% for other goods, with consumption tax charged on top.

The Ministry of Finance's explanation of the fiscal 2026 tax reform sets out a model similar to Australia's. An online sale shipped to Japan from abroad of an item priced at ¥10,000 or less per unit is treated as a domestic sale, and the seller owes Japanese consumption tax on it. The import exemption at the border stays in place, because taxing roughly 190 million parcels at customs is not practical. At the same time, the 60% valuation rule for personal-use goods ends on March 31, 2028.

On the Canadian side, the Canada Border Services Agency requires an export declaration for commercial goods valued at CAN$2,000 or more. Non-restricted goods valued below that, which covers most single consumer parcels, need no declaration, and the carrier documents are marked as no declaration required.

Wholesale shipments and pallets to a Japanese distributor usually cross that line. Before the first one, get a business number with an RM export program account, and file through the Canadian Export Reporting System, which the CBSA recommends. The carrier needs the proof of report number before the goods leave.

For parcels under the ¥10,000 threshold, tariffs are already zero, so the trade agreement does little. It matters for larger and wholesale shipments. Global Affairs Canada lists Japanese tariffs that the CPTPP removed on entry into force for Canadian goods, including frozen blueberries (up to 9.6%), aluminum products (up to 7.5%) and plastic tubes (4.8%), while beef tariffs of 38.5% are being cut to 9% within 15 years. To claim the preferential rate, the goods must meet the agreement's rules of origin and the importer needs the origin documentation.

Japan's Act on Specified Commercial Transactions lists what a mail-order seller's advertising must show, and Japanese shoppers look for it on a dedicated disclosure page. The list includes the price including shipping, payment timing and method, delivery timing, cancellation and return terms, the seller's name, address and phone number, the name of a representative or responsible person for a company, and any other costs the buyer must pay. Ask your counsel how the Act applies to a seller with no office in Japan; in practice, a store without this page looks unfinished to Japanese buyers.

Returns need particular care. If the store does not state its own return terms, a mail-order buyer can cancel and return the goods within 8 days of delivery at the buyer's expense. For internet sales, the Consumer Affairs Agency says return terms must also appear on the final confirmation screen before the order is placed.

The 2028 rules change the economics of each route. The right choice depends on your price points, order volume and whether you want to own the customer relationship.

These are the items we check when scoping a Japanese storefront. Our team has led engineering for a high-traffic commerce platform in Japan, and most of the work is in details a Canadian template does not cover.