Economy & Trade
Trump orders 50 percent tariffs on many Canadian goods
US President Donald Trump signed orders Monday to impose new 50 percent tariffs on many Canadian goods, citing what he called discriminatory treatment by Ottawa against American alcohol, automobile and dairy products.
The White House said the tariffs will take effect in 30 days and will cover several products, including wine, hockey sticks and cement. It said the duties will not apply to energy, potash or goods already covered by sector-specific tariffs. However, the tariffs will apply to products covered by the US-Mexico-Canada free trade agreement.
Trump used Section 338 of the Tariff Act of 1930 for the new duties. The report said many of Trump's tariffs were struck down by the Supreme Court this year, and described the legal provision used for the latest action as untested.
Canadian Prime Minister Mark Carney said Ottawa was ready to intensify talks with the United States and had made proposals to settle disputes and modernize the USMCA. He said the US action was part of a series of unilateral trade measures that he said violated the Canada-United States-Mexico Agreement. Carney said Canada had only matched those measures, which he said was its right.
The White House said Canada and China were the two countries that retaliated against Trump's broad tariff actions since 2025. It also pointed to decisions by most Canadian provinces to halt purchases of US alcohol after Trump's tariffs and repeated calls for Canada to become the 51st US state.
US Trade Representative Jamieson Greer accused Canada of removing US alcohol products from Canadian shelves, giving better dairy market access to the European Union, and putting a cap on US vehicle exports to Canada from companies moving production back to the United States. Greer said the tariff announcement was intended to hold Canada accountable for retaliation and discrimination.
The order could further strain relations with Canada, described in the report as the second largest US trade partner. It came days after Trump threatened Canada with higher tariffs over wildfire smoke that moved into the United States.
Scott Lincicome of the Cato Institute said it was the first time Section 338 had been used to impose tariffs. He said many experts believe the law has been replaced by other authorities and argued that Trump had shown a willingness to use any available statute. Ryan Majerus, a former US trade official now at King & Spalding, said the law carried significant litigation risk because it had not been tested. He said the move appeared designed to gain leverage over Canada during USMCA negotiations, which he said had advanced more quickly with Mexico than with Canada.
Majerus said removing exemptions for USMCA imports would have substantial effects if the tariffs take effect as announced. Chris Swonger, president of the Distilled Spirits Council of the United States, said the alcohol industry welcomed recognition of Canadian restrictions but had hoped the issue could be resolved without further escalation. He warned that high tariffs could risk more retaliation while many US hospitality businesses were still under financial pressure.
Lincicome said Washington's discrimination claims over dairy could also be viewed as questionable because they relate to Canada's trade agreement with the European Union. He said it was not certain that a court would strike down the tariffs, and that any ruling would take time, leaving significant uncertainty in the meantime.
Update
The White House said the 50 percent tariffs will take effect in 30 days and cover items including wine, hockey sticks and cement.
The duties will not apply to energy, potash or goods already affected by sector-specific tariffs, but will apply to products covered by the US-Mexico-Canada free trade agreement.
Trump used Section 338 of the Tariff Act of 1930, described by experts in the report as untested for this purpose.
The White House and US Trade Representative Jamieson Greer accused Canada of retaliation and discrimination involving alcohol, dairy market access and vehicle exports.
Trade experts and a spirits industry representative warned of litigation risk, uncertainty and possible escalation or retaliation.
Source note: AFP news report published on 21 July 2026 at 00:29:51 UTC.
Update
Carney described the tariffs as part of a series of unilateral US trade actions.
Carney said the US actions began with tariffs that he said directly violated the Canada-United States-Mexico Agreement.
Carney said Canada had made proposals to resolve disputes as Washington changed its trade ties.
Source note: AFP news report published on 21 July 2026 at 00:12:15 UTC.
Update
Carney said Canada was ready to intensify trade talks after Trump ordered new tariffs.
Source note: AFP news report published on 21 July 2026 at 00:01:12 UTC.
Update
The new duties are based on Section 338 of the Tariff Act of 1930, described in the source as an untested legal provision.
The tariffs will not apply to energy, potash or goods already covered by sector-specific tariffs, but will apply to products covered by the US-Mexico-Canada agreement.
The White House said Canada and China were the only countries to retaliate against Trump's sweeping tariffs last year.
The source reports business concerns about escalation and includes comments from trade experts and the Distilled Spirits Council of the United States.
The source says the announcement came days after Trump threatened Canada with increased tariffs over wildfire smoke entering the United States.
Source note: AFP news report published on 20 July 2026 at 23:06:01 UTC.
Update
The tariffs will cover items including wine, hockey sticks and cement.
The White House said the duties will not apply to energy, potash and goods already covered by sector-specific tariffs.
The duties will apply to products covered under the US-Mexico-Canada free trade agreement.
Trump used Section 338 of the Tariff Act of 1930 for the new duties.
Scott Lincicome said this would be the first use of Section 338 to impose tariffs.
Ryan Majerus said the legal basis carries litigation risk and may be intended to increase leverage over Canada.
Majerus said removing exemptions for USMCA imports would be highly negative for US supply chains and businesses if the tariffs take effect as announced.
Source note: AFP news report published on 20 July 2026 at 22:36:07 UTC.
Update
The tariffs cover a wide range of goods including wine, hockey sticks and cement, according to the White House fact sheet.
Trump used Section 338 of the Tariff Act of 1930 as the legal basis for the duties.
The duties will not apply to energy, potash or goods already affected by sector-specific tariffs, according to the White House.
The new tariffs will apply to products covered by the US-Mexico-Canada free trade agreement.
The action follows Trump's recent threat to raise tariffs on Canada over wildfire smoke drifting into the United States.
Source note: AFP news report published on 20 July 2026 at 21:38:55 UTC.
Update
Trump signed orders imposing the tariffs on Monday.
The White House cited "discriminatory treatment" in alcohol, automobiles and dairy products.
The tariffs are due to take effect in 30 days.
Energy, potash and goods already subject to sector-specific duties are excluded.
The new tariffs cover goods entering the United States under the US-Mexico-Canada trade pact.
Source note: AFP news report published on 20 July 2026 at 21:19:35 UTC.
Uncertainty notes
The legal durability of tariffs imposed under Section 338 is uncertain because the provision is described as untested for this use.
The final impact depends on whether the tariffs take effect as announced after the 30-day period.
Possible Canadian retaliation or further escalation is a risk raised by business and expert comments, not a confirmed outcome.
Source
AFP news report published on .