Canada's retaliatory tariffs on US goods took effect just after midnight Tuesday, escalating an 18-month trade dispute after negotiations between the two countries collapsed last month.
What The Tariffs Cover
The countermeasures apply to $27.6 billion worth of American products, including steel and aluminum, dairy, household appliances, agricultural equipment, pulp and paper, plastics and electronics, with duties ranging from 15% to 50%. Existing tariffs on steel and aluminum were raised from 25% to 50% to match US rates, while separate counter-tariffs on American autos remain in place.
Talks Fell Apart Last Month
The retaliation follows the collapse of trade talks in late August, when President Trump's 50% tariffs on Canadian wine, furniture, dairy products, cement, clothing, fishing rods and hockey equipment took effect after the two sides failed to reach a deal. Canadian Prime Minister Mark Carney said Ottawa could not accept the terms the US offered at the last minute, while US Trade Representative Jamieson Greer disputed that account, saying Washington had tried to accommodate Canada by cutting tariffs on steel, aluminum and autos.
A Sticking Point Over Trucks
One of the key disagreements centered on how larger vehicles would be treated, with Canada pushing for favorable terms on medium- and heavy-duty trucks to extend to models like Ford's F-350 and General Motors' Silverado, a request the US resisted. Ontario Premier Doug Ford backed Carney's decision to walk away, calling the proposed deal bad for the province's auto, steel and manufacturing sectors.
Impact On Consumers
Trade experts warn that the escalating tariffs will likely trickle down to households on both sides of the border in the form of higher prices, with one legal analyst noting that nearly all industries could see downstream effects from the widening dispute. With both governments continuing to publicly blame each other for the breakdown, there is no clear timeline for when talks might resume.