US President Donald Trump has announced plans to raise tariffs on Canadian vehicles, automotive parts and steel to 50 percent from January 1, 2027, escalating an already tense trade dispute between the United States and Canada.
Trump made the announcement on Monday in a post on his Truth Social platform, saying the higher duties would cover cars and trucks of all sizes, automotive parts and steel imported from Canada.
The proposed increase would represent a significant rise for Canadian vehicles, which currently face a 25 percent US tariff on non-US content. Imported steel, meanwhile, generally already attracts a 50 percent US duty.
Trump’s latest threat follows the failure of Washington and Ottawa to reach an agreement last Friday over new US tariffs on selected Canadian goods. The additional 50 percent duties took effect on Saturday, affecting about 5.5 percent of Canadian goods entering the US, worth roughly $20 billion.
The affected products range from hockey sticks and cement to other Canadian exports.
Canada Announces Retaliatory Tariffs
Canadian Prime Minister Mark Carney has responded by announcing retaliatory measures against US products after rejecting what he described as a “bad deal.”
The Canadian tariffs will target American steel and dairy products, as well as agricultural equipment, pulp and paper and electronics.
Canada’s retaliatory measures are scheduled to take effect on September 8.
The White House has accused Canada of unfairly treating US alcohol, automobile and dairy products while imposing its own trade restrictions.
Trump had previously delayed the implementation of the new US tariffs by three days to give both countries more time to negotiate.
However, talks involving Canada’s top negotiator Dominic LeBlanc and US Trade Representative Jamieson Greer ended without an agreement after negotiations continued late into Friday.
Trade Tensions Escalate
Trump on Monday accused Canada of taking advantage of the United States for years, arguing that Washington did not need its northern neighbour.
Greer, however, said the Trump administration had offered several concessions during negotiations, including eliminating a 10 percent tariff on Canadian softwood lumber and reducing the existing 25 percent auto tariff.
Washington was also prepared to lower steel tariffs on most Canadian steel from 50 percent to 25 percent, according to Greer.
Carney subsequently announced that Canada was suspending trade negotiations, while Greer said on Monday that no further talks had yet been scheduled.
Beyond the immediate tariff dispute, Washington and Ottawa also face negotiations over changes to the US-Mexico-Canada Agreement (USMCA), the North American trade pact that Trump has indicated he does not want to renew in its current form.
Trump’s repeated comments about potentially making Canada the 51st US state have also added to tensions and anger among many Canadians.
Source: AFP.
