explainer
The U.S. president imposed new across-the-board tariffs on Canada, straining already strained relations with its second-largest trading partner.
U.S. President Donald Trump has imposed new 50% tariffs on a wide range of Canadian products, threatening to further strain relations with Canada’s second-largest trading partner.
The tariffs were announced Monday and are expected to go into effect within 30 days, according to a White House fact sheet, and cover a wide range of items including wine, hockey sticks and cement.
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The White House claimed “discriminatory treatment” from Ottawa on U.S. alcohol, autos and dairy products behind the latest tariffs.
President Trump last week threatened to raise tariffs on Canada over the wave of wildfire smoke that descended on the United States.
Here’s a breakdown of the products affected and why:
What products are affected?
President Trump invoked Section 338 of the Tariff Act of 1930, the first recorded use of the law in its nearly century of existence. The law allows the president to impose punitive tariffs of up to 50% on trading partners deemed to have discriminated against American products.
Import duties apply to a wide range of products, from wine to cement to ice hockey equipment. The new tariffs will also apply to dairy products, swimming pools, furniture, fishing rods, seeds, clothing and wigs.
The Office of the U.S. Trade Representative said the tariffs will apply to nearly $20 billion of Canadian imports, or about 5.2% of the $382 billion worth of items the U.S. will import from Canada in 2025.
President Trump also cited the trade deficit with Canada as the reason behind the significant tariffs. According to Washington, the US trade deficit in goods with Canada will be $46.4 billion in 2025, with Canadian oil and gas being the main cause of the deficit.
The White House said the tariffs do not apply to oil, gas, critical minerals, potash or products already affected by sectoral tariffs.
What did the US say?
The Trump administration says the new tariffs apply regardless of whether the product is included in the existing United States-Mexico-Canada Agreement (USMCA) or the Canada-United States-Mexico Free Trade Agreement (known in Canada as CUSMA).
Washington has already imposed tariffs of 15% to 50% on Canadian copper, aluminum and steel, and on top of that, it has imposed 25% duties on non-U.S. auto parts.
In announcing the new tariffs, the White House said it was the only country other than China to retaliate against President Trump’s tariffs last year.
“Canada has improved market access for dairy products from the European Union, removed U.S. alcohol products from Canadian shelves, and capped U.S. vehicle exports to Canada from companies reshoring to the U.S.,” U.S. Trade Representative Jamison Greer said in a statement.
He added that the purpose of the tariff announcement was to “hold Canada accountable for its retaliation and discrimination.”
The White House further asserted in a fact sheet that “the United States, under President Trump’s leadership, has not agreed to renew the (USMCA) in its current form because the agreement is not sufficiently beneficial to the United States.”
How did Canada react?
Canadian Prime Minister Mark Carney said in a statement that President Trump’s tariffs are “the latest in a series of unilateral trade actions by the United States” and are in direct violation of the trilateral free trade agreement.
“Recognizing that the United States has transformed all of its trade relationships over the past 18 months, including those covered by CUSMA, Canada has made a detailed and comprehensive set of proposals to resolve this dispute and modernize CUSMA,” he said in a statement posted to his X account. “We stand ready to intensify these discussions in the coming weeks.”
“This trade dispute is increasing the burden on American families in particular. Canada stands ready to work intensively to address outstanding issues with the United States for the mutual benefit of our people,” he added.
Carney tried to negotiate with Trump last year, but talks ended abruptly in October after Ottawa aired anti-tariff ads in the United States.
