The digital shopping carts of Canadian consumers may soon carry a heavier price tag as new tariff measures threaten to inflate the cost of online purchases. Economic analysts are sounding the alarm that the federal government’s recent policy shifts could significantly impact e-commerce prices across various retail categories.
“We’re looking at what could be a perfect storm for Canadian online shoppers,” explains Dr. Amrita Singh, retail economics professor at University of Toronto. “The combination of new tariff structures with already strained supply chains means consumers will likely bear the brunt of these added costs.”
The changes stem from Ottawa’s revised approach to international trade agreements, which introduces tariffs ranging from 5% to 18% on various imported goods commonly purchased through online platforms. These increases will particularly affect electronics, apparel, and household items – categories that dominate e-commerce sales in Canada.
Data from Statistics Canada reveals that over 68% of Canadians make regular online purchases, with the average household spending approximately $4,200 annually on digital transactions. This widespread adoption of e-commerce makes the tariff impact especially consequential for the average consumer.
Retail Council of Canada spokesperson Michael Thompson tells CO24 Business that businesses face difficult choices: “Retailers will either need to absorb these additional costs – which is nearly impossible in today’s thin-margin environment – or pass them along to consumers. Most will have no choice but to choose the latter.”
Small business owners like Toronto-based Emily Chen, who operates an online boutique selling imported housewares, feels caught in the middle. “My suppliers have already notified me of 12% price increases. As a small operation, I simply can’t absorb those costs and remain profitable,” Chen explains.
The tariffs arrive at a particularly challenging time, as Canada continues to grapple with persistent inflation in essential goods and services. Economic forecasts suggest these new costs could add between $250-$450 to the annual shopping expenses for the typical Canadian household.
Consumer advocacy groups are calling for targeted exemptions to protect essential goods from price increases. “We need to ensure that necessities remain affordable, particularly for lower-income Canadians who are already stretching every dollar,” says Consumer Rights Association director Janet Williams.
Meanwhile, some enterprising shoppers are exploring workarounds, including cross-border shopping services and timing purchases around duty-free thresholds. However, experts caution that such strategies come with their own complications and may not provide long-term solutions.
The situation has created unique challenges for multinational retailers with Canadian operations. Companies must navigate complex supply chain adjustments while maintaining competitive pricing in a market increasingly sensitive to cost increases.
As world trade tensions continue to fluctuate, the question remains: will these tariff measures achieve their intended economic goals, or will they simply transfer additional financial burden to Canadian consumers already struggling with the rising cost of living?
