HVAC Tariffs in Canada: BC, Alberta and Ontario Compared (2026)
Updated: Sep 29
HVAC tariffs in BC are changing how contractors buy, price and install equipment. Canada's new counter-tariffs took effect on September 8, 2026, at surtax rates of 15%, 25% or 50% depending on the tariff item. Canada has no large-scale domestic manufacturing of residential and commercial heating and cooling equipment, so BC service providers absorb much of the operational and financial burden.
Which HVAC Products Are Affected?
The surtax applies only to goods that originate in the United States. Goods merely shipped from the U.S. may not qualify.
Product | Tariff (U.S.-origin) |
|---|---|
Split-system air conditioners and heat pumps (tariff items 8415.10, 8415.81.10, 8415.82.10) | 15% |
Certain air/gas compressors (8414.80.90), hot-air heating units and parts (7322) | 25% |
Steel and aluminum | 50% |
Some gas furnaces may still qualify for a previously granted remission. Confirm classification and origin with your customs broker.
Example: 3-Ton Air Conditioner, Before and After Tariffs (BC)
A 3-ton split system (about 10.5 kW) falls under the 15% heat-transfer-capacity category. Figures are illustrative, in CAD, for U.S.-origin equipment.
Line item | Before tariff | After tariff |
|---|---|---|
Base equipment price | $3,200.00 | $3,200.00 |
Counter-tariff (15%) | $0.00 | $480.00 |
Subtotal | $3,200.00 | $3,680.00 |
GST (5%) | $160.00 | $184.00 |
PST (7%) | $224.00 | $257.60 |
Total | $3,584.00 | $4,121.60 |
Increase: +$537.60 (+15%).
Example: Compressor, Before and After Tariffs (BC)
Illustrative 3-ton scroll compressor, assuming U.S.-origin and classification under a 25% item.
Line item | Before tariff | After tariff |
|---|---|---|
Base compressor price | $800.00 | $800.00 |
Counter-tariff (25%) | $0.00 | $200.00 |
Subtotal | $800.00 | $1,000.00 |
GST (5%) | $40.00 | $50.00 |
PST (7%) | $56.00 | $70.00 |
Total | $896.00 | $1,120.00 |
Increase: +$224.00 (+25%).
Remarks
Tax on tax: GST and PST are charged on the tariff too, so a $480 tariff becomes $537.60 at checkout.
Origin matters: an Asian- or European-built unit with no U.S. origin carries no counter-tariff, so its price stays at the "before" figure.
Classification varies: many refrigeration compressors are classified outside the 25% item. Confirm with a customs broker.
Labour is extra: installation is not included, and PST treatment on installed contracts can differ. Check with your accountant.
Province Comparison: Alberta and Ontario
The tariff rates and base equipment prices are the same nationally. What changes province to province is the sales tax layered on top, which changes how much of the tariff's cost is amplified at checkout.
Alberta: 3-Ton Air Conditioner (15% tariff)
Alberta charges GST only, with no provincial sales tax.
Line item | Before tariff | After tariff |
|---|---|---|
Base equipment price | $3,200.00 | $3,200.00 |
Counter-tariff (15%) | $0.00 | $480.00 |
Subtotal | $3,200.00 | $3,680.00 |
GST (5%) | $160.00 | $184.00 |
Total | $3,360.00 | $3,864.00 |
Increase: +$504.00 (+15%).
Alberta: Compressor (25% tariff)
Line item | Before tariff | After tariff |
|---|---|---|
Base compressor price | $800.00 | $800.00 |
Counter-tariff (25%) | $0.00 | $200.00 |
Subtotal | $800.00 | $1,000.00 |
GST (5%) | $40.00 | $50.00 |
Total | $840.00 | $1,050.00 |
Increase: +$210.00 (+25%).
Ontario: 3-Ton Air Conditioner (15% tariff)
Ontario charges a single 13% HST.
Line item | Before tariff | After tariff |
|---|---|---|
Base equipment price | $3,200.00 | $3,200.00 |
Counter-tariff (15%) | $0.00 | $480.00 |
Subtotal | $3,200.00 | $3,680.00 |
HST (13%) | $416.00 | $478.40 |
Total | $3,616.00 | $4,158.40 |
Increase: +$542.40 (+15%).
Ontario: Compressor (25% tariff)
Line item | Before tariff | After tariff |
|---|---|---|
Base compressor price | $800.00 | $800.00 |
Counter-tariff (25%) | $0.00 | $200.00 |
Subtotal | $800.00 | $1,000.00 |
HST (13%) | $104.00 | $130.00 |
Total | $904.00 | $1,130.00 |
Increase: +$226.00 (+25%).
Remarks: BC vs Alberta vs Ontario
Same tariff, different totals: the base price and tariff percentage are identical across provinces. Only the sales tax mechanism changes the final number.
Alberta has the lowest total burden: GST-only means the tariff is taxed once, with no provincial layer on top.
Ontario's HST produces the largest tax-on-tariff effect: at 13%, the $480 AC tariff becomes a $542.40 increase, the highest of the three provinces.
BC sits in the middle: GST plus PST together equal 12%, close to Ontario's 13% HST but split across two separate taxes.
Five Ways Tariffs Are Hitting HVAC Businesses
1. Higher equipment costs. Heat pumps, air handlers, compressors and air conditioners cost more at wholesale. Steel and aluminum duties raise costs further.
2. Supply chain delays. Customs re-routing and distributor inventory adjustments cause shortages of control boards, motors and coils. Technicians end up extending temporary repairs or rescheduling installs.
3. Diluted heat pump rebates. Demand for cold-climate heat pumps is strong under CleanBC and comparable provincial programs. Higher unit prices erode the value of rebates and incentives, so the homeowner's net cost rises.
4. Margin compression. Fixed-bid commercial contracts often lock contractors into pre-tariff pricing. In residential work, full pass-through leads to rejected quotes, deferred replacements and a shift toward repairs.
5. Adapting operations. Contractors are responding in three main ways:
Alternative sourcing: non-U.S.-origin lines (for example Mitsubishi Electric and Fujitsu) shipped to Canadian ports. Verify country of origin model by model.
Escalation clauses: add price-adjustment clauses to quotes and bids.
Stock management: hold larger reserves of high-turnover parts.
FAQ
Do Canadian counter-tariffs apply to every air conditioner? No. They apply only to U.S.-origin goods under specific tariff items.
Does the tariff get taxed? Yes. Sales tax is charged on the price including the tariff, so the effective cost increase is higher than the tariff rate alone.
Which province sees the biggest tax-on-tariff impact? Ontario, because its 13% HST is the highest combined sales tax rate of the three provinces compared here.
Can homeowners still get heat pump rebates? Yes, but higher unit prices reduce the rebate's net benefit.
References
Department of Finance Canada, Complete list of U.S. products subject to counter tariffs
Need technically sound HVAC content for your Canadian audience? Contact SureOne Consultancy Inc., Brampton, Ontario.
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