U.S. Tariffs Of 35% Are Imposed On Canadian Goods

U.S. President Donald Trump has signed an executive order increasing tariffs on Canadian goods to 35% from 25% effective August 1. The new duties apply to all Canadian imports into America that are not covered by the U.S.-Mexico-Canada trade agreement. Once again, President Trump cited Canada’s failure to stop fentanyl smuggling into America as the reason for the high tariffs. Despite Trump’s claims, there is no evidence from law enforcement in either country that Canada is a major source of fentanyl entering the U.S. By most accounts, Canada is responsible for only 1% of U.S. fentanyl imports. The illicit drug that crosses into the U.S. the most from Canada is cannabis, according to data from American and Canadian border agencies. Regardless, President Trump made good on his promise to impose steeper tariffs on Canada if a new trade deal was not reached by an August 1 deadline. Canadian Prime Minister Mark Carney said on social media he was disappointed by President Trump’s decision. “While we will continue to negotiate with the United States on our trading relationship, the Canadian government is laser focused on what we can control: building Canada strong,” wrote Carney online. The prime minister added that the new U.S. tariffs will impact lumber, steel, aluminum, and motor vehicles. He pledged to protect Canadian jobs, buy Canadian goods, invest in industrial competitiveness, and diversify Canada’s export markets. In a media interview, U.S. Commerce Secretary Howard Lutnick said President Trump could reconsider the tariffs on Canada if Prime Minister Carney “starts turning on the charm.” While import duties on Canada are going up, President Trump agreed to give Mexico a 90-day extension to work toward a trade deal, allowing it to avoid a 30% import duty. However, Mexico must still pay a 25% duty on U.S.-bound exports that are not covered under existing trade agreements. Canada currently sends about three-quarters (75%) of its exports to the United States.