The Trump administration on Monday announced a fresh 50% tariff on certain goods imported from Canada. According to the White House, the move comes in response to what it called Canada’s “discriminatory treatment” of American cars, alcohol and dairy products.
US President Donald Trump signed three proclamations to bring the tariffs into effect by using Section 338 of the Tariff Act of 1930, a nearly century-old law that allows the US government to impose tariffs of up to 50% on imports from specific countries, Reuters reported.
The new tariffs are scheduled to come into effect on August 19.
Which Canadian products will be affected?
The new tariffs cover a long list of Canadian goods entering the United States.
According to a White House fact sheet, products affected include wine, hockey sticks, cement, dairy products, swimming pools, furniture, fishing rods, seeds, clothing and wigs, among other items.
However, not every Canadian export will be affected. The White House said energy products, potash, fish, critical minerals and goods already covered under Section 232 tariffs have been exempted from the new measure.
The tariffs will also apply even if the products qualify for duty-free treatment under the US-Mexico-Canada Agreement (USMCA.)
The administration said each of the three proclamations covers a different group of Canadian products.
“Each Section 338 proclamation imposes a 50% tariff on a different set of Canadian imports, covering products ranging from wine to hockey sticks to cement,” the senior administration official said.
Why is the US imposing these tariffs?
The White House said Canada continues to treat American products unfairly.
It pointed to Canada’s dairy system, describing it as “protectionist,” and also criticised Canada’s tariffs and quotas on US-made cars while allowing vehicles from some other countries to enter under different rules.
The US administration also referred to the decision by most Canadian provinces to stop selling American alcoholic beverages. Canada had taken that step earlier in response to previous US tariffs.
US Trade Representative Jamieson Greer defended the decision, saying:
“While the Administration continues to secure fair and reciprocal trade deals with our trading partners, Canada, unlike other partners and allies, continues to retaliate against the United States for its efforts to rebalance trade and protect US industry in national-security sensitive sectors.”
Trade tensions have been growing
The latest tariffs come only days after Trump accused Canada of being responsible for wildfire smoke drifting into the United States.
At the time, he also threatened to add the “incalculable cost” of dealing with the smoke to the tariffs already imposed on Canadian goods.
The White House also released figures claiming that over the past year, Canadian imports of US-made motor vehicles have fallen by 22%, while imports of American alcoholic beverages have dropped by 81%.
The administration said the United States and Canada are still in contact, but formal trade negotiations are not taking place right now.
Speaking to ABC News, a senior administration official said both sides have exchanged ideas about improving the trade relationship, but discussions have not reached the stage of official negotiations.
“We’ve certainly shared ideas with them regarding Canadian trade barriers or practices that the United States would like to see remedied. They’ve shared ideas with us on the future of the trade relationship and how to enhance economic security in North America. So we certainly have had discussions, including substantive discussions. That being said, we’re not in a formal negotiating stage at this point,” the official said.
