Canadian Border Security (CBSA) Practice Exam

What does the CBSA collect on imported goods on behalf of the Government of Canada?

1. Sales tax and service charges

2. Duties and taxes

3. Import licenses and permits

4. Environmental fees

The correct answer is: Duties and taxes

The CBSA's role in collecting duties and taxes on imported goods is a fundamental aspect of border security and trade regulation in Canada. When goods enter Canada, they are subject to various tariffs and taxes that are set by the government. This includes customs duties, which are imposed on certain imports based on their value and classification, as well as GST/HST (Goods and Services Tax/Harmonized Sales Tax), which applies to most imported goods. The collection of these duties and taxes is crucial for several reasons. First, it generates revenue for the government, which can be used for public services and infrastructure. Second, it helps regulate trade by influencing the pricing of imported goods and protecting domestic industries from unfair competition. By ensuring compliance with these financial obligations, the CBSA plays a vital role in maintaining the integrity of Canada's trade policies and economic stability. In contrast to other options, sales tax and service charges typically refer to domestic transactions rather than specifically to imports. Import licenses and permits relate to the regulatory side of importing certain controlled or restricted items, while environmental fees are specific charges related to the environmental impact of certain products and are not universally applied to all imported goods. Thus, the primary focus of the CBSA regarding imported goods is on duties and taxes, which