Turmoil likely as Trump officials say Canada unfairly discriminated against US autos, alcohol and dairy products
Donald Trump is imposing 50% tariffs on most Canadian goods in response to the country retaliating against previous US tariffs, the White House announced Monday, declaring Canada has unfairly discriminated against American cars, alcohol and dairy products.
The tariffs will hit a wide range of products, the White House said, including wine, hockey sticks and cement. They also include goods previously protected from import taxes under the United States-Mexico-Canada (USMCA) agreement.
The new tariffs will exclude energy products, fish, critical minerals and potash. They also exclude products already subject to tariffs aimed at protecting national security, such as steel and aluminum.
The steep tariffs will probablyunleash a new wave of economic chaos, with risks of higher inflation and further fraying of relations between two nations that had been closely woven together before Trump’s return to the White House.
The White House said the tariffs will go into effect in 30 days, leaving time for possible negotiations between the two countries.
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Trump signed three proclamations to launch the tariffs under Section 338 of the 1930 Trade Act. Several Democratic lawmakers last year proposed repealing the section because they said Trump could use it to destabilize the economy.
A White House fact sheet claims Trump is “taking action to hold Canada accountable for its continued discrimination against and unreasonable and unequal treatment of U.S. commerce that has burdened and disadvantaged hardworking Americans”.
Trump claims in the proclamations that Canada discriminates against American automobiles, alcohol and cheese relative to other nations, but his argument rests in large part on retaliatory actions taken by Canada after the US president imposed tariffs on Canada under the pretext that it should do more to stop fentanyl smuggling into the US.
Trump noted in his autos proclamation that Canada maintained, starting in April 2025, a 25% tariff on the imports of US motor vehicles that did not qualify for preferential treatment under the USMCA.
The White House also cited all but two Canadian provinces and territories stopping the sale of US alcoholic beverages, while not imposing similar restrictions on other countries.
Trump also objected to Canada’s treatment of US cheese, saying in his proclamation that Canada discriminates against the US compared to Europe on dairy products.
Trump had threatened last week to impose tariffs due to smoke from devastating wildfires in Canada drifting across large portions of the US.
“We are holding Canada responsible for the fact that they are not properly maintaining their Forests, and Brush therein, and the United States is being unnecessarily invaded by filthy, polluted, and unhealthy air, the quality of which is dangerous, and totally unacceptable!” he wrote on Truth Social.
Trump watched Sunday’s World Cup final with Mark Carney, the Canadian prime minister who has previously pushed back on the US president and won the premiership last year on a platform of promising to stand up for Canada.
After the match, Trump told reporters he had raised the issue of wildfire smoke with Carney.
“I told him, I mean, ‘You got to stop these fires from coming in and, you know, poisoning our air. Our air has been poisoned,’” Trump said of their conversation.
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A White House official who previewed the new tariffs to reporters said Trump has requested aides explore additional tariffs due to Canadian wildfires harming US air quality, the Associated Press reported.
The Canadian federal government did not immediately comment on Trump’s action, but Doug Ford, the Ontario premier, said he’d “never stop fighting to protect Ontario”.
“If these tariffs proceed, Canada should respond tariff for tariff, dollar for dollar,” Ford posted on social media.
Candace Laing, the CEO of the Canadian chamber of commerce, said the Trump administration’s moves were “regrettable” but the two countries need to use the 30-day window before the tariffs start “to make meaningful progress in advancing formal talks”.
The new taxes on Canadian imports could carry serious political and economic risks for Trump ahead of the November midterm elections for control of Congress. His so-called “liberation day” tariffs last year in April provoked a financial market meltdown over concerns about inflation and a recession, prompting him to walk back the rates for a period of negotiation.
In a 6-3 decision in February, the supreme court ruled that Trump had illegally used emergency executive power to impose his global tariffs, causing the administration to find alternative ways to raise import taxes based on a series of legal authorities.
The US has been forced to pay back $81bn in tariffs so far this fiscal year.
The Associated Press contributed reporting
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