Canada has announced retaliatory tariffs of between 15 per cent and 50 per cent on a wide range of US goods, escalating the trade dispute between the two historically close allies.
Ottawa said the new tariffs will take effect on September 8, following the introduction of 50 per cent US tariffs on Canadian goods by President Donald Trump on Saturday.
Canadian officials said the retaliatory measures were designed to match US tariff levels and would affect industries including steel, dairy, electronics and consumer goods.
Products on the list include fresh and frozen fish, dishwashers, washing machines and industrial goods such as railway construction materials.
The Canadian government also announced a $5.4bn (CA$7.5bn) support package for businesses and workers affected by the tariffs.
“This is an unprecedented challenge imposed on Canada. But Canada will meet the moment,” Finance Minister Francois-Philippe Champagne said.
He added that Canada would respond in a “proportionate, targeted and strategic way” while maintaining unity among Canadians.
Industry Minister Melanie Joly also urged Canadians to support local businesses and said the government would strengthen relationships with new allies and trading partners.
Joly further warned that Canada would “fight back” if Trump followed through with plans to increase US tariffs on Canadian automobiles to 50 per cent.
The latest US tariffs affect about $20bn worth of Canadian goods, equivalent to roughly 5.5 per cent of Canada’s exports to the United States, following the collapse of trade negotiations between the two countries.
Under Canada’s planned response, US steel and aluminium products that were previously subject to a 25 per cent duty will face tariffs of 50 per cent.
Other products, including appliances, cheese and certain steel and aluminium derivative products, will face 25 per cent tariffs.
A smaller category of goods, including electrical equipment and tools, will attract a 15 per cent tariff.
Collectively, the targeted goods accounted for about 7.3 per cent of Canada’s imports from the United States based on 2024 trade levels.
Economists and analysts have warned that the measures could trigger further tit-for-tat escalation between the two countries.
Trump on Monday pledged to double tariffs on Canadian automobiles next year, potentially raising the rate to 50 per cent from the current 25 per cent on non-US content.
Ontario Premier Doug Ford criticised the threat, using strong language against Trump and warning that Ontario could impose a surcharge on electricity exports to the United States.
Trump responded by threatening “far worse” consequences and again referred to Canadian Prime Minister Mark Carney as a “governor”, reviving his controversial calls for Canada to become the 51st US state.
The US president also said Tuesday that he was considering renaming Lake Ontario as “Lake America”, following his administration’s earlier move to rename the Gulf of Mexico as the “Gulf of America”.
Trump’s latest tariffs also do not exempt products covered by the United States-Mexico-Canada Agreement (USMCA).
Oxford Economics estimates that the measures will increase the effective US tariff rate on Canadian exports to 6.9 per cent from 5.1 per cent, with plastics, electrical machinery, and wood and paper products contributing most to the increase.
“Manufacturers in Quebec, New Brunswick, and Ontario will be affected the most,” Oxford Economics said.
The dispute intensified after Carney said US negotiators had made last-minute demands that Canada restrict trade agreements with other countries.
He also alleged that US officials had made unacceptable threats involving the French language and Quebec culture.
Trump rejected the accusation, saying on Truth Social that he would “never interfere with Canadians speaking French” and accusing Carney of making false claims to gain political support.
The United States remains Canada’s largest trading partner, with Canadian exports to the US accounting for about 70 per cent of its total exports.
Canada is also the second-largest US trading partner in goods so far this year, behind Mexico.
Despite the escalating dispute, polling released by the Angus Reid Institute showed that Canadians broadly supported Carney’s decision to walk away from negotiations, although concerns remained about the potential economic consequences.
The White House had previously accused Canada of “discriminatory treatment” against US alcohol, automobile and dairy products as Ottawa introduced its own trade measures.
Trump subsequently delayed implementation of some tariffs, but several days of negotiations failed to produce a new agreement.
