Trade War Returns: Trump Hits Canada With 50% Tariffs

By Staff, Agencies

Trade tensions escalated on Monday as US President Donald Trump announced broad tariffs on Canada, raising pressure on one of the United States’ closest allies and largest economic partners.

The new measures mark some of the steepest tariffs imposed by the administration, targeting 50% duties on certain Canadian goods, including electrical equipment and machinery.

Although Trump has recently threatened tariffs against America's neighbor in retaliation for wildfire smoke that poured into the northern regions of the US, administration officials said the latest tariffs are unrelated.

According to the White House, the tariffs will take effect in 30 days and cover around $20 billion worth of Canadian goods.

In response, Canadian Prime Minister Mark Carney said the country "believes in the benefits of free and fair trade," in a statement on Monday.

"In all circumstances, Canada will work relentlessly and take any measures necessary to build our strength at home and to support Canadian workers, farmers, businesses, and families," Carney said.

Similarly, Ontario Premier Doug Ford went further, immediately encouraging Canada to retaliate. "If these tariffs proceed, Canada should respond tariff for tariff, dollar for dollar," Ford said in a post on X.

The administration said Trump’s decision relies on Section 338 of the Tariff Act of 1930, which allows tariffs of up to 50% against countries accused of discriminating against US goods, though the law has never been used this way.

However, several major Canadian imports, including energy products and critical minerals, were excluded from the new tariffs, while goods covered by the US-Mexico-Canada trade agreement received no exemptions.

Despite the broad announcement, Capital Economics estimated that only about 5% of Canadian imports would be affected, representing roughly 0.6% of total US imports.

Overall, the latest move expands Trump’s reliance on tariffs as a trade tool, even as previous tariff plans face legal challenges and tensions persist with major partners such as China and Brazil.