President Donald Trump is escalating the US-Canada trade fight again, signing orders that would slap new 50% tariffs on a wide range of Canadian goods as he accuses Ottawa of “discriminatory treatment” toward American alcohol, automobile and dairy products.
The White House said the new duties will take effect in 30 days and apply to an array of products, including wine, hockey sticks and cement.
Mr Trump, who has watched many of his tariffs struck down by the Supreme Court this year, turned this time to a little-used legal tool to justify the move: Section 338 of the Tariff Act of 1930.
According to the White House, the latest duties will not apply to energy, potash and goods already impacted by sector-specific tariffs.
But the action breaks with a key recent pattern, reaching into products covered under the US-Mexico-Canada free trade agreement (USMCA).
Canadian Prime Minister Mark Carney responded by saying Canada is prepared to “intensify” talks with the United States, adding that his government has put forward proposals to resolve disputes and modernise the USMCA.
“This is the latest in a series of unilateral US trade actions that began with the US imposing a series of tariffs in direct violation of the Canada-United States-Mexico Agreement,” he added.
“Canada, as is its right, has merely matched those measures,” Mr Carney said.
The announcement also raised alarm among some businesses, who fear a tit-for-tat spiral.
Donald Trump had threatened Canada with increased tariffs over wildfire smoke descending into the US
Since returning to the presidency last year, Mr Trump has imposed duties on a range of US trading partners, though his orders often carved out exemptions for goods entering under the USMCA.
This time, the tariffs could add fresh strain to relations with America’s second largest trade partner. The move comes only days after Mr Trump threatened Canada with increased tariffs over wildfire smoke that descended into the United States.
In rolling out the new tariffs, the White House said Canada was one of just two countries — along with China — to retaliate against Mr Trump’s sweeping duties from 2025.
Officials also pointed to actions within Canada that have targeted US products, noting that most Canadian provinces have halted purchases of US alcohol amid Mr Trump’s tariffs and his repeated calls for annexation of Canada as America’s “51st state”.
“Canada has taken US alcohol products off Canadian shelves, given better market access to dairy products from the European Union, and has put a cap on US vehicle exports to Canada from companies reshoring to the United States,” charged US Trade Representative Jamieson Greer.
The tariff announcement is intended to “hold Canada accountable for its retaliation and discrimination,” he added.
Chris Swonger, president of the Distilled Spirits Council of the United States, said the alcohol industry welcomed recognition of Canada’s restrictions.
“We had hoped, however, that this issue could be resolved without further escalation,” Mr Swonger said.
He warned that steep tariffs could trigger further retaliation “at a time when many US hospitality businesses continue to face financial hardships,” he said.
