They overcharge to duties and taxes and for the exchange rate. Essentially charging more than twice the normal rate for both. I know what the taxes are for importation of consumer goods into Canada and they have overcharged me for taxes and duties on every order from Sephora (who no longer uses them, thank goodness) and for Nordstrom (who unfortunately will not ship without borderfree). They also are a hassle to deal with in general. I also find that their packages seem to take MUCH longer to clear customs than packages sent from other shipping companies. Not sure why this is.
I would pay extra to have another shipping option with duties and taxes paid on delivery as borderfree is not worth the headache or the extra fees.
I am really hoping with the move of some Nordstrom stores into Canada that they will stop using borderfree and offer a ship from store or Canadian warehouse option.